Tunis: Lack of Single Currency in W’Africa Impeding Exports

Tunis: Lack of Single Currency in W’Africa Impeding Exports

Michael Olugbode in Abuja

The Speaker, Economic Communities of West African States (ECOWAS) Parliament, Dr Sidie Mohamed Tunis, has lamented that the lack of single currency in the West African sub-region has been impeding viable exports in the area.

Speaking at the the opening of the fifth legislature themed, “ECOWAS Common Currency and the Inter Bank Payment System as Promoters of Regional Trade,” yesterday in Bissau, Guinea Bissau, Tunis said the level of exports which currently stood at 10% margin was very low for a region of 400 million people.

“As you are aware, intra-regional trade is relatively low in the ECOWAS region. According to statistics, it represents about 10% of both exports and imports of Member States. Several reasons have been put forward to explain these low levels of intra-community trade.

“Among these, the lack of a single currency among ECOWAS Member countries, has been identified as a major obstacle and a factor that aggravates transaction costs. In addition, efficient payment systems are a stimulus for intra-regional trade.

“Having identified these challenges, and to increase the volume of trade in the region, the ECOWAS Authority of Heads of State and Government decided to accelerate the process of creating a single currency, through the adoption of the convergence pact and a new roadmap for the launch of the single currency by 2027. It is gratifying to state that this decision by the Heads of State, has led to significant progress in recent years.

“As a consequent, thereof, the ECOWAS Parliament, through this parliamentary seminar, saw it befitting for members to be informed on these policies and programmes of the community, namely the state of progress of the single currency programme, as well as the project for the development of the inter-bank payment system.

“The Parliament also wishes to contribute fully to the process of creating the single currency, by ensuring effective monitoring of the community bodies and institutions in charge of this programme and by promoting the support of the populations of which we are, in essence, the closest representatives.”

He urged that parliamentary seminar should, therefore, enlighten lawmakers on the conditions for strengthening convergence and macroeconomic stability in the region.

His words: “It would also provide a greater insight into the coordination of economic policies, and the development of a payments system for the Member States to facilitate their economic integration. Furthermore, this seminar would address all the other challenges we are determined to meet, to achieve the single currency by 2027, as announced.

“This would provide Honorable Members with the opportunity to debate the new roadmap submitted by the ECOWAS Commission to the Authority of Heads of State and Government and, at the same time, make proposals and recommendations guaranteeing the start of the monetary union in 2027.”

In his keynote address, President of the Republic of Guinea Bissau, Umaro Sissoco Embalo, expressed personal support in actualising the adoption of the Single Currency within the ECOWAS region.

Embolo said: “We are creating a new economy which is also financial and commercial within  ECOWAS., the money system that we want to establish will encourage or stimulate our development and maintain the friendship, solidarity and cooperation among our countries and populations.

He however, said the process should be conducted very conclusively because there were various challenges ahead, hence the reason to introduce the common currency, as well as the involvement of political class and all those interested parties by creating a foundation of strong political and economical integration.

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