By Chris Agabi
A single currency for West African countries is increasingly becoming unlikely as member countries convergence performance scores have declined.
All countries in the subregion convergence criteria performances declined in 2023.
“The assessment of Member States’ performance reveals that, as at the end of June 2023, all WAMZ Member States failed to meet all the four primary convergence criteria. The Zone’s performance score declined to 29.2 percent, compared to 41.7 percent during the same period in 2022” Dr. Olorunsola Olowofeso, the Director- General, the West African Monetary Institute (WAMI) said.
The five West African Member States (The Gambia, Ghana, Guinea, Nigeria and Sierra Leone) had formed the West African Monetary Zone (WAMZ) in December 2000 with the desire to float a single Currency for West Africa.
Among other criteria, the participating countries are to achieve the following; a single-digit inflation rate at the end of each year; a fiscal deficit of no more than 4% of the GDP; a central bank deficit-financing of no more than 10% of the previous year’s tax revenues and gross external reserves that can give import cover for a minimum of three months.
Dr. Olowofeso who spoke in Abuja said even by 2026, none of the countries would meet the critical criteria.
“The medium-term projections on macroeconomic convergence, as indicated by the multi-year national macroeconomic convergence and stability programmes of the Member States, suggest that none of the WAMZ Member States will meet all the four primary convergence criteria on a sustainable basis for the remaining three consecutive years (2024-2026) of the convergence phase of the ECOWAS Single Currency Roadmap (2021-2027)” he said.
Commenting on the matter, the Minister of Finance and Coordinating Minister for the Economy, Mr. Wale Edun said that Nigeria remained committed to achieve the objectives of WAMZ.
