The West African Institute for Financial and Economic Management (WAIFEM) has extended its outreach beyond the traditional mandated zone of central banks and ministries of finance and planning.

It now covers other ministries, departments and agencies, legislatures, the mass media, private sector, financial enterprises, and selected civil society organisations in countries of member central banks.

Besides West African states, countries in North and Southern Africa, Europe and Latin-America are also benefiting from the Institute’s programmes, says WAIFEM’s Director of Admin & Finance Department Ousman Sowe, while delivering his opening remarks at a regional workshop on Economic and Financial Analysis for journalists.

Held last week in the Nigerian main commercial city of Lagos, the week-long workshop, which brought together journalists from The Gambia, Ghana, Nigeria, Liberia and Sierra Leone, was organized by WAIFEM to increase the “economic quotient” of participants to enable them use their job functions to cultivate a more enlightened electorate that will engender greater popular participation in the national economic and financial agenda.



Dilating on the institute’s diversified techniques and tools of intervention to include workshops, senior policy seminars, legislative fora, demand assessment, follow-up and institutional building missions, training for trainers and inter-regional seminars, Mr Sowe noted that WAIFEM was established in July 1996 by the Central Banks of The Gambia, Ghana, Liberia, Nigeria and Sierra Leone, and its principal mandate is to build capacity for debt, financial sector, and macroeconomic management in the countries of the member central banks. It commenced operations in April 1997.

He said: “During its formative years, it [WAIFEM] concentrated on short-term customised courses that benefited officials from institutions in financial and macroeconomic management.”

According to the Admin and Finance Director, in its efforts to source cutting-edge knowledge and skills to enrich its programmes and consolidate its billing as a centre of excellence in capacity building, WAIFEM partners with leading capacity building organizations, which include the International Monetary Fund (IMF), the World Bank, African Development Bank, the United Nations Institute for Training and Research (UNITAR), Debt Relief International (DRI), African Capacity Building Foundation (ACBF), Development Finance International (DFI) Commonwealth Secretariat, Bank of England, US and UK Treasury Departments, and Dresdner Bank.

While speaking about the single monetary zone, Mr Sowe said that in recent years, most West African countries have undertaken economic reforms aimed at improving macroeconomic management through financial sector and trade liberalization in order to widen economic space for private sector activities.

“One of the recent initiatives towards regional integration was the establishment of the West African Monetary Zone (WAMZ) in December 2000,”he explained. “The WAMZ is expected to work towards the integration of the economies of the five participating countries within the context of the ECOWAS arrangement.

“The commencement date for the WAMZ common currency has been postponed thrice (January 2003, July 2005, and December 2009), due to the inability of member countries to meet the required quantitative and qualitative criteria.”

In addition to the four primary and six secondary convergence criteria, Mr Sowe indicated that other elements of the Banjul Declaration include harmonization of the currency and payment systems architecture, development of a region-wide automated processing standard, activation of WAMZ secretariat, West African Financial Supervisory Authority (WAFSA), establishment of the headquarter building of the West African Central Bank (WACB), ratification of protocols and conventions and members’ payment of their financial contributions arrears.

“Thus, while the WAMZ project is on course to materialize in 2015, intra-WAMZ trade can be promoted through the use of local currencies in intra-regional transactions,” he said, pointing out that the informal sector in the region is already practising the free convertibility of regional currencies in their cross-border activities with appreciable success.

However, the bulk of intra-regional trade is still transacted on cash basis and this form of trade has little prospect of meeting the objective of a single economic space in the sub-region.

“At its 20th meeting held on May 10, 2007, Abuja, Nigeria, the convergence council of WAMZ approved the adoption of WAMZ national currencies for intra-regional trade finance,” the WAIFEM Director said, adding: “The scheme was to be purely private sector driven. The council called on member states to abolish all the vestiges of exchange control from their statutory books to relax the market space for increased flow of intra-regional trade. Central banks were enjoined to provide the macroeconomic environment conducive to a regime of stable exchange rates crucial to the promotion of economic competitiveness.”

According to him, the recent report on the implementation of the scheme is not too favourable as the operators, especially banks, are unwilling to participate in the scheme unless the central banks would act as guarantor to take up the net position of their currencies.

The use of national currencies for intra-regional trade finance in West Africa has generated debate on the issue for some time, he said, adding that the rising trend of strong globalization underscores the urgent need for WAMZ member states to enter into monetary cooperation under a framework of currency convertibility and macroeconomic policy harmonization.

This, he said, if actualised, the arrangement will pave way for the realization of the ultimate goal of a single currency and a centralised monetary authority.

The informal sector economic operators are already enjoying the fruits of free convertibility of regional currencies in their cross-border activities, Mr Sowe concluded.

BY: MARIAM SAINE