Launch of ECOWAS second monetary zone postponed

Lagos- Nigeria (PANA) -- Leaders of five-member States of the ECOWAS second monetary zone have postponed the launch of their common currency to 1 July 2005, the ECOWAS Secretariat said in a statement in Abuja Tuesday.
The event had been scheduled for 1 January 2003.
The statement said the postponement was decided at the just-concluded fourth Summit of the zone in Conakry, following the countries' inability to meet the convergence criteria for the introduction of the common currency.
Under an Accra agreement for the creation of the second monetary zone, the five countries - The Gambia, Ghana, Guinea Conakry, Nigeria and Sierra Leone - committed themselves to reforming their economies to meet specific targets.
These included restriction on budget deficit to no more than four percent by 2002, taming of inflation to five percent by 2003 and maintaining a ceiling on Central Bank financing of budget deficit to just 10 percent of previous year's revenue.
The countries are also to achieve a level of foreign exchange reserve to support at least six months of imports by 2003.
The Conakry Summit adopted an action plan to enable States to meet the convergence criteria, while the emergence of the West African Central Bank, slated for this year, has been shifted to between 2003 and 2005.
Other decisions included the extension of the mandate of the Accra-based West African Monetary Institute (WAMI), which has responsibility to midwife the second monetary zone, and extension of the tenure of its Director General, Michael Ojo.
The five-nation second monetary zone and the eight West African Economic and Monetary Union (UEMOA) countries currently using the CFA franc, would together operate a planned ECOWAS common currency scheme by 2005.
Liberia, the 15th nation in the sub-regional economic grouping, has an observer status in the second monetary zone.

19 november 2002 13:16:00

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