The Vice-President, Dr Mahamudu Bawumia, has cautioned member countries of the West Africa Monetary Zone (WAMZ) to be wary of the impact of external shocks as they diversify their economies and markets.
He said developments in the Eurozone, which highlighted the need for countries to achieve and maintain the required level of macroeconomic stability prior to and after the formation of a monetary union, should serve as a guide to the countries in designing and implementing a robust framework for the WAMZ.
“As you discuss the progress towards attaining our collective goals, situate the debate within the global context, vis a vis the challenges confronting the zone,” he advised.
Convergence Council meeting
Dr Bawumia, who gave the advice when he addressed the opening of the 41st meeting of the convergence council of ministers and governors of central banks of the WAMZ in Accra yesterday, therefore, stressed the need for member states to encourage trading among themselves, as well as intensify efforts to eliminate non-tariff barriers.
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Participants in the meeting will take stock and deliberate on the way forward for deeper monetary and economic integration in the WAMZ and the wider ECOWAS programme. They are the ministers of finance and governors of the central banks of member countries of the WAMZ.
The Vice-President noted that despite the many milestones reached by the WAMZ, its implementation process had encountered many challenges and for that reason, “we have had to postpone the launch of the single currency on several occasions.”
He said a strong progressive outcome of the meeting would, therefore, signal the commitment of the member countries and shape the direction of their collective journey towards the establishment of a monetary union.
He said Ghana, for its part, had met three out of the four macroeconomics convergence criteria and also all of the secondary criteria.
Dr Bawumia said WAMZ continued to embrace a gradual and sustained spread of digital transactions, characterised by the traditional paper methods.
He, however, cautioned that “in embracing digitisation in the financial ecosystem, we should be mindful of the corporate governance challenges that may threaten the stability of the entire system.”
“Strong corporate governance in the zone under the auspices of the college of supervisors of the WAMZ should be paramount in strengthening the financial sector of member countries,” he said.
Dr Bawumia lauded the WAMZ payment system development project which, he said, had created the needed platform for effective and efficient payment systems in the Gambia, Guinea, Liberia, Sierra Leone and which were compatible with the payment systems in Ghana and Nigeria.
He described that development as important in the integration process, adding that the next step was a pan- African payment system initiative, led by Afri Exim Bank, which would interlink the payment systems in WAMZ and subsequently extend it to cover the subregion and the rest of sub-Saharan Africa.
An ECOWAS Commissioner in charge of Macroeconomic policy, Dr Kofi Konadu Apraku, said Ghana had expressed its commitment to the recently established special fund for the road map to the single currency programme by paying $1 million as its subscription.
He said the biggest challenge was budget deficit as a ratio of GDP, since only five countries had met that criteria.