The implementation of single currency drive of the Ecowas sub region has continued to be an Herculean task with the failure of most member states in meeting major criteria for the unification.
This prompted the need to revise the road map, and constitute a presidential task force to accommodate new challenges and fast track the monetary integration quest, through the single currency program.
An initiative agreed upon by founding fathers of ECOWAS in decades ago,the single currency market , with 2020 as its launch date is a single major factor in the economic growth and trade promotion target as espoused by the founders.
However, there are a lot of areas to be considered and laws to be ratified if the single currency framework will see the light of the day.
Speaking at a workshop on challenges and prospects of the ECOWAS single currency program organized, by the national institute for legislative and democratic studies, NILDS in partnership with the ECOWAS parliament, the Director General of NILDS, Prof. Ladi Hamalai, noted that the single currency has its immense benefits in areas of economic growth and employment opportunities, but shouldn’t be a hasty decision.
She is calling for caution in the process of implementing the monetary program across member states in the bloc.
“I think we should not go too fast, at the moment it is too slowly, because we have so many challenges and obstacles, the basic macroeconomic fundamentals of most countries are still not stable enough for such venture” she said.
In Nigeria she noted that, “there has some been basic infrastructure and processes that have begun to take place to make inter mobility of currencies and transfer very easy, that is a good step”
The director of monetary policy Central Bank of Nigeria, Momodu Saho , highlighted some issues to be resolved if the 2020 deadline is to be met.
He said that” in addition to meeting the macroeconomic convergence criteria, harmonization of economic policies and practices laws and regulations are essential to the creation of a monetary union.”
Saho also observed that “The budget deficit criteria is the most difficult to meet as the convergence profile is very small”.
The elements of the macroeconomic convergence criteria are; budget deficit\GDP of not greater than or equal to 3%, Average annual inflation not more than 10%, central bank financing of budget deficit not more than 10% of previous year’s tax revenue and Gross external reserves not more than 3 months of imports.
In an assessment of the progress so far, statistics show that no member state have been able to satisfy the primary convergence criteria completely,only three countries have made significant efforts in policy.
Most member states have high inflation rate, deep in both domestic and external debts, Cape Verde for instance has inflation record above the convergence criteria, and other countries in the west African Anglophone bloc( WAMZ).
Nigeria’s inflation figure of 12.5 is still being disputed, differences in banking laws across countries and many more challenges needs to be addressed before the deadline and that is where the fear lies, whether or not the single currency 2020 deadline can be met.
Reacting to the challenges highlighted above, Dr. Jodi Apraku member of parliament from Ghana is positive the plan will pull through, and called for more commitment from member states.
“The single currency will never happen by chance, what we lack is political will, and it is not beyond west Africa, that is why we have a roadmap, and this is the first time we have constituted a presidential task force,if we don’t achieve a single currency, it is because we don’t want it”.
With Britain leaving the European Union EU, and its attendant challenges, most people question the relevance of this decades old resolution in recent times.