President of the Commission of the Economic Community of West African States (ECOWAS), Jean Claude Kassi Brou, says many member-states of the sub-region have not met the macroeconomic convergence criteria required for the much touted single currency for the region.
Brou said this while presenting the Community Work Programme at the ongoing Second Ordinary Session of the ECOWAS Parliament in Abuja on Wednesday. He noted that the Authority of ECOWAS Heads of States and Governments had also reaffirmed the decision that was taken earlier that countries that were ready would start the process in 2020, and those not ready would be given time to join.
According to Brou, the Presidential Task Force set up by ECOWAS Authority of Heads of State and Governments to achieve a monetary union for the sub region would meet in December on the modalities to achieve the 2020 target for West Africa, which would promote economic integration.
“There is a technical meeting that will be held early next month, specifically the Task Force meeting.
“It will discuss progress on the roadmap for the single currency but specifically focus on the issue of the monetary policy framework harmonisation.
“They will also discuss the issues of the next regional central bank, the main logo for the single currency; these are very important issues that they will discuss early next month, ” Brou said.
The ECOWAS authority had approved the reduction of the macroeconomic convergence criteria from 11 (four primary and seven secondary) to six (three primary and three secondary).
The three primary criteria that are being used are a budget deficit of not more than 3 percent; average annual inflation of less than 10 percent with a long-term goal of not more than 5 percent by 2019, and gross reserves that can finance at least three months of imports.
The three secondary convergence criteria that have been adopted by ECOWAS are public debt/Gross Domestic Product of not more than 70 percent; central bank financing of budget deficit should not be more than 10 percent of previous year’s tax revenue, and nominal exchange rate variation of plus or minus 10 percent.
Brou also said a 3.4 percent growth rate was projected for the ECOWAS region in 2019 against 3 percent experienced in 2018, which was a significant progress, adding that six member-states recorded growth rates of more than 6 percent in 2018. These are Benin Republic, Burkina Faso, Cape Verde, NigerRepublic, Ghana, and Senegal.
Furthermore, on the Common External Tariff (CET), he said the tariff was being implemented in all member states except Cape Verde, which he noted a study to assess the impact was being carried out by its government.