By Yankuba Jallow
The Director General of WAMA Mr. Momodou Bamba Saho, said the Heads of States of the Economic Community of West African States (ECOWAS), in December 2017 endorsed a single currency that will be ready in 2020.
Saho made this and other remarks at the opening of a three day meeting of the Economic and Monetary Affairs and the Operation and Administration Committees of the West African Monetary Agency (WAMA). The joint meeting began yesterday at a local hotel in Kololi and will end on the 3rd of February 2018.
WAMA DG Saho said ECOWAS Economic activity was more resilient in the first half of 2017, with a growth rate estimated at 1.5%, compared to a contraction of 0.2% in the corresponding period of the preceding year. He said growth prospects for end 2017 are projected to be more favourable as the region was expected to record a growth rate of 2.2% after the near stagnation recorded in 2016. He affirmed that this favourable development was due to the effects of Ghana’s strong recovery and sustained economic dynamism in UEMOA coupled with the gradual rebound of economic activity in Nigeria, following a recession in the preceding year.
He said from the assessment of the progress made in the implementation of the ECOWAS Monetary Cooperation Program (EMCP), joint WAMA/WAMI/ECOWAS Commission on multilateral surveillance missions were carried out in April and September 2017, to review performance as at end December 2016 and end June 2017; that from the assessment, it showed that level of performance deteriorated, particularly with respect to the criterion on inflation.
He said despite these challenges, the outlook remains positive and hinges on the maintenance of macroeconomic stability as well as structural reforms, aimed at fostering private sector growth. He urged member states to strengthen their resolve towards maintaining microeconomic stability and put emphasis on economic diversification and improving the business climate in order to unleash the tremendous potential of the sub region, and achieve the objectives of the Monetary Cooperation Program.
Speaking at the opening ceremony, the keynote speaker and Governor of the Central Bank of the Gambia, Bakary Jammeh, said the sub-region faced challenges of varying degrees in recent past, including a decline in commodity prices, weather related causes and security. He said these factors did not only put pressure on the exchange rates and prices but hampered public finance and economic growth; that this resulted to the performance of member countries in terms of achieving convergence.
He said in spite of challenges, “our countries are making significant progress”; that they have made huge investments in the integration process; that they have made gains along the way including payment systems development, common external tariff, ECOWAS Trade liberalisation, amongst others.
In addition, the Governor said economies in ECOWAS have exhibited modest upswing movements; that the growth rate for the ECOWAS region was estimated at 2.2% in 2017, compared to a marginal growth of 0.2% in 2016; that this performance remained significantly below potential and not broadly inclusive; that deep reforms are needed to remove bottlenecks.
On the economy, Governor Jammeh said the Gambian economy has started to recover following the sharp growth slowdown in 2016. He said economic growth declined sharply from 4.3% in 2015 to 2.2% in 2016, but recovery is under way with a projected growth of 3% and 3.8% in 2017 and 2018 respectively. He said the rising trend in inflation has reversed from a high of 8.8% in January 2017 to 6.9% in December 2017, reflecting the stabilisation of the exchange rate and a gradual decrease in food prices; that the Gross International Reserves increased to about 4 months of imports cover and services in January 2018.
“Our fiscal position is much improved, thanks to the tight expenditure limits, fiscal consolidation and ongoing reforms”, he said.
“Despite these remarkable achievements, challenges remain, including the high level of public debt at 120% of GDP. Cognisant of the risk, we have developed a medium-term debt strategy (MTDS) with the aim of stabilising the debt. The strategy focuses on lengthening the maturity structure of the domestic debt to reduce the rollover risk and debt service. On external financing, greater reliance is on highly concessional loans and grants. Debt relief and restructuring the external debt would also free resources for poverty reduction” he said.
Governor Jammeh said the Presidential Task Force on the Single Currency Program met in October 2017 in Niger directed the Ministerial Committee to meet within three months to propose a new roadmap with a view to accelerating the creation of a single currency in 2020.
Other speaker included Mr. Moses K. Tule, who doubles as the Director of Monetary Policy at the Department of the Central Bank of Nigeria and the outgoing Chairman of the Technical Committee of WAMA.