Prof. Uche Uwaleke, President of Capital Market Academics of Nigeria, asserts that Nigeria stands to gain much from the ECOWAS single currency project.
In an interview with the News Agency of Nigeria on Sunday in Abuja, Mr. Uwaleke, who is also the Director of the Institute of Capital Market at Nasarawa State University, Keffi.
Uwaleke said that, as Nigeria has the largest economy in the subregion, he claimed that if the ECOWAS single currency were to be implemented, it would considerably promote free commerce throughout the subregion.
He says it goes without saying that the ECOWAS’s single currency will promote capital market integration, free movement of goods, and overall economic integration.
“Given her huge population, Nigeria is positioned to benefit most from the free movement of goods and persons resulting from the implementation of a single currency.
“It will enhance capital formation and lead to increased volume of trade among member-states, expanding job opportunities and enabling growth and development in the region,” he said.
But Mr. Uwaleke issued a warning: if the Eurozone’s past was any indication, there were significant obstacles that needed to be overcome in order for the target date of 2027 to be achievable.
“Unfortunately, it does seem that the target looks unrealistic.
“ECOWAS appears fragmented with the exit of three of her members. Virtually all member-states are far from meeting the primary convergence criteria set by the West African Monetary Institute.
“In the case of Nigeria, the leading economy in the region in terms of Gross Domestic Product (GDP) size, inflation rate has been double digit for many years.
“Actual budget deficit as a percentage of GDP has been more than four per cent, and the CBN direct financing of fiscal deficits has been in excess of 10 per cent,” he said.
He claims that several other member states share the same situation and are unable to have gross external reserves large enough to cover three months’ worth of imports.
“There is equally the fact that France is not supporting the French speaking member States UEMOA, to have independent central banks.
“Against this backdrop, the first task for ECOWAS in the direction of a single currency is to unite politically, lure back the three countries that exited into their fold and then support each other to strengthen their domestic economies.
“Any attempt to inaugurate a single currency without ECOWAS first putting its house in order will witness a still-birth project,” he said.
The 15 ECOWAS states’ finance ministers and governors of their central banks recently announced their intention to launch the effort known as the ECO, which aims to create a common currency.
Nigeria has endorsed the project, which aims to advance economic growth and development throughout the continent of West Africa.
The National Identity Management Commission is planning to introduce three-in-one identity cards in August, and one of its characteristics is the one currency.
The Ministry of Finance released a statement highlighting Nigeria’s resolute dedication to ensuring its effective execution.
According to the announcement, Wale Edun, the Coordinating Minister of the Economy and Minister of Finance, highlighted the crucial role that ECO will play in promoting economic growth and development in the sub-region. NAN
