Monetary Union in West Africa

Monetary Union in West Africa PDF

Author: Xavier Debrun

Publisher:

Published: 2002

Total Pages: 42

ISBN-13:

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We develop a multicountry model in which governments aim at excessive spending in order to serve the narrow interests of the group in power. This puts pressure on the monetary authorities to extract seigniorage, and thus affects the incentives countries would have to participate in a monetary union. This feature, ignored by the monetary union literature for Europe, is potentially important in Africa. We calibrate the model to data for West Africa and use it to assess proposed ECOWAS monetary unions. We conclude that monetary union with Nigeria would not be in the interests of other ECOWAS countries, unless it were accompanied by effective discipline over Nigeria's fiscal policies.

Regional Integration in West Africa

Regional Integration in West Africa PDF

Author: Eswar Prasad

Publisher: Brookings Institution Press

Published: 2021-07-13

Total Pages: 203

ISBN-13: 0815738544

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" Assessing the potential benefits and risks of a currency union Leaders of the fifteen-member Economic Community of West African States (ECOWAS) have set a goal of achieving a monetary and currency union by late 2020. Although some progress has been made toward achieving this ambitious goal, major challenges remain if the region is to realize the necessary macroeconomic convergence and establish the required institutional framework in a relatively short period of time. The proposed union offers many potential benefits, especially for countries with historically high inflation rates and weak central banks. But, as implementation of the euro over the past two decades has shown, folding multiple currencies, representing disparate economies, into a common union comes with significant costs, along with operational challenges and transitional risks. All these potential negatives must be considered carefully by ECOWAS leaders seeking tomeet a self-imposed deadline. This book, by two leading experts on economics and Africa, makes a significant analytical contribution to the debates now under way about how ECOWAS could achieve and manage its currency union, andthe ramifications for the African continent. "

West African Economic and Monetary Union (WAEMU)

West African Economic and Monetary Union (WAEMU) PDF

Author: International Monetary Fund

Publisher: International Monetary Fund

Published: 2012-03-22

Total Pages: 71

ISBN-13: 1475502427

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The staff report on discussions with regional institutions of the West African Economic and Monetary Union is presented. The region faced a number of challenges in 2011, with the intensification of the political crisis in Côte d’Ivoire and a large increase in global food and fuel prices. A materialization of downside risks could require a monetary policy relaxation for the union and differentiated fiscal responses across member countries. The drought in the Sahel may also require a more active fiscal policy in the affected countries.

Monetary Union in West Africa (ECOWAS)

Monetary Union in West Africa (ECOWAS) PDF

Author: Paul R. Masson

Publisher:

Published: 2001

Total Pages: 46

ISBN-13: 9781589060142

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In April 2000 six West African countries declared their intention to proceed to monetary union among the non-CFA franc countries of the region by January 2003, as a first step toward a wider monetary union including all the ECOWAS countries in 2004. The purpose of this paper is to evaluate whether a monetary union makes economic sense, to discuss the institutional requirements for successful monetary union and to consider how best the political momentum for a union can be channeled toward a fundamental improvement in underlying policies.

West African Economic and Monetary Union

West African Economic and Monetary Union PDF

Author: International Monetary Fund. African Dept.

Publisher: International Monetary Fund

Published: 2015-04-13

Total Pages: 48

ISBN-13: 1484325265

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KEY ISSUES Context. The region continued to experience strong growth in 2014, led by the continued economic expansion in Cote d’Ivoire. The outlook is for further strong growth, subject to a range of downward risks, in particular political instability ahead of upcoming elections in several countries, and security issues in Mali and Niger. With an elevated fiscal deficit exerting pressure on the balance of payments and the regional financial market, delays in fiscal consolidation or structural reforms pose the main medium-term risks. Policy recommendations: • Fiscal consolidation. Safeguarding external stability in the region will require governments to adhere to their budget deficit reduction plans while maintaining public investment efforts, which will require increasing tax revenue and controlling current expenditure. • Monetary policy. Macroeconomic conditions do not warrant a tightening of monetary policy at this juncture. However, if fiscal deficits do not decline as envisaged, the BCEAO should consider increasing its policy rates. In the mean time, the BCEAO should very closely follow the evolution of the macro-prudential risks flowing from its sharp increase in commercial bank refinancing. • Financial stability. The WAEMU authorities should enforce existing prudential rules and raise standards to international best practice. Ongoing reforms go in the right direction but need to be accelerated. • Structural transformation and regional integration. Policies to promote structural transformation should focus on addressing weaknesses, such as the lack of education and training, finance, and supportive regulatory environments. Countries should refrain from using the possibility to deviate from the common external tariff of the Economic Community of West African States (ECOWAS) in force since January 1, 2015, in order to protect the gains from regional integration in WAEMU.

Monetary Union in West Africa: Who Might Gain, Who Might Lose, and Why?

Monetary Union in West Africa: Who Might Gain, Who Might Lose, and Why? PDF

Author: Xavier Debrun

Publisher: INTERNATIONAL MONETARY FUND

Published: 2002-12-01

Total Pages: 35

ISBN-13: 9781451875393

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We develop a multicountry model in which governments aim at excessive spending in order to serve the narrow interests of the group in power. This puts pressure on the monetary authorities to extract seigniorage, and thus affects the incentives countries would have to participate in a monetary union. This feature, ignored by the monetary union literature for Europe, is potentially important in Africa. We calibrate the model to data for West Africa and use it to assess proposed ECOWAS monetary unions. We conclude that monetary union with Nigeria would not be in the interests of other ECOWAS countries, unless it were accompanied by effective discipline over Nigeria's fiscal policies.

West African Economic and Monetary Union

West African Economic and Monetary Union PDF

Author: International Monetary Fund. African Dept.

Publisher: International Monetary Fund

Published: 2024-04-17

Total Pages: 72

ISBN-13:

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The WAEMU has seen strong growth and rising living standards over the past decade. Economic growth averaged 5.4 percent in 2013-2019 and 5.8 percent in 2021-2023. Policy efforts from regional and national authorities have cushioned the impact of several external and internal shocks, prompting a solid economic recovery since the COVID-19 pandemic, despite increasing security issues. Meanwhile, the Human Development Index has increased from 0.44 in 2013 to 0.48 in 2021.

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