We are on course to meet the single currency criteria – Bawumia

Vice President, Dr. Mahamudu Bawumia on Friday said Ghana is the most compliant country in the last assessment of the member states of the West African Monetary Zone status of compliance aimed at establishing a single currency by 2020.

He added that the nation emerged the second-best performer in terms of trade integration and ECOWAS trade related protocols and looking forward to sustaining the good performance and even performing better.

He noted that Ghana had met three out of the four macroeconomic convergence criteria and had attained all the secondary criteria outlined towards the establishment of a monetary union in the sub-region.

Vice President Bawumia, therefore, urged member countries of WAMZ to build resilient economies that could withstand external economic shocks in the quest to attaining a monetary union.

He made the observations at the opening ceremony of the 41st Meeting of the Convergence Council of Ministers and Governors of Central Banks of the West African Monetary Zone (WAMZ), in Accra.

The participants comprised; Ministers of Finance and Trade of member countries of WAMZ as well as Governors of the Central Banks of member states and would take stock of the progress made so far in attaining a monetary union and macroeconomic developments and convergence reports on member states towards compliance with the primary and secondary criteria and economic integration in the sub-region.

The meeting is organised under the auspices of the Ministry of Finance and the Bank of Ghana, in collaboration with the West African Monetary Institute (WAMI).

Vice President Bawumia noted that being mindful of the challenges preceding the formation of a monetary union and its sustenance, the Akufo-Addo-led government, upon assumption of office in 2017, had been implementing a number of initiatives to address the challenges and promote financial inclusion.

He mentioned some flagship programmes such as; the national biometric identity cards to provide unique identity for the citizenry, paperless port clearing system, digital property addressing system and mandatory tax identification numbers for the members of the labour force, as well as trade facilitation and easy way of doing business geared towards building a modern and formalised economy.

Those initiatives, Dr Bawumia said begun bearing fruits with the nation recording one of the fastest growing economies in the world with a real gross domestic product (GDP) growth of 8.1 per cent in 2017, with the current GDP estimate of six per cent for 2018.

He added that the country’s policy, inflationary and exchange rates had been trending downwards, with the cedi depreciating only by 8.4 per cent against the dollar during the second half of 2018 despite the shocks from external sources.

Consequently, government also passed the Fiscal Responsibility Act that would limit the fiscal deficit and Fiscal Council to offer professional advice to the government.

“Ghana has adopted the Statistical Methodological Framework and satisfactorily harmonised its statistical compilation and reporting format with ECOWAS regional standards and had begun implementing the Common External Tariffs,”Dr Bawumia emphasised.

The Vice President noted that the medium-term outlook looked positive for the country and urged the member countries to situate the debate within the global context vis-à-vis the challenges confronting the Zone to guide them in designing and implementing a robust framework.

He cited the challenges that confronted the Euro Zone in time past and encouraged member states to build stronger macroeconomic stability before and after the establishment of a monetary union.

In view of the limited time required for the implementation, Vice President Bawumia underscored the need for member nations to harmonise their policies towards the attainment of the benchmark set for the implementation of the WAMZ programme.

He entreated them to attach much urgency to the issues that would be discussed at the meeting because it could end up in less progressive outcomes or strong progressive outcomes that would signal their commitment in shaping their collective journey towards the establishment of a monetary union.

Vice President Bawumia asked pertinent questions regarding how the format the Monetary Union of WAMZ would operate, and thus, asked member countries to come to a firm agreement, saying; “We need to speak with one voice and we need not to establish another bureaucracy to have a WAMZ Commission, the existing institutions can be transformed into a Commission”.

The West African Monetary Zone (WAMZ) is a group of six-member states comprising; Ghana, The Gambia, Guinea, Liberia, Nigeria and Sierra Leone, established by the Agreement of the West African Monetary Zone (2000)

The WAMZ statutory meetings were held from Monday, February 4 to 8, 2019. The meetings are bi-annual events convened by WAMI and hosted by member states on a rotational basis.

Meetings scheduled to take place at the WAMZ include; the 44th Meeting of the Technical Committee of WAMZ, 38th Meeting of the Committee of Governors of the Central Banks of the member states and 41st Meeting of the Convergence Council of Ministers and Central Bank Governors.

Policy papers and progress reports, which would form the basis for discussions include; Convergence Reports, Policy Issues Focusing on Optimum Currency Area Index for ECOWAS, Financial Integration Issues Highlighting Capital Market and Insurance Integration in West Africa, as well as Trade, Administrative and Legal issues.