Practicability of A West African Monetary Zone: A Conceptual Exploit

Unizik Journal of Economic Studies, 13(1), 64-76

14 Pages Posted: 17 Jan 2019

See all articles by Damian J. Nwankwo

Damian J. Nwankwo

Coventry University

Ebele Nwokoye

Nnamdi Azikiwe University - Department of Economics

Chris U. Kalu

Nnamdi Azikiwe University

Date Written: March 8, 2016

Abstract

What are the necessary and sufficient conditions for meeting the convergence criteria and thereafter, for the formation of the West African Monetary Zone (WAMZ), a counterpart of the European Monetary Union (EMU)? Against this background, the paper examines the practicability of achieving or otherwise the West African Monetary Zone which aims at the rapid integration of the six West African economies of The Gambia, Ghana, Guinea, Liberia, Nigeria and Sierra Leone. The paper employs the content analysis approach for this examination and discovered that drawing its experience from EMU, WAMZ has not been able to realize the objective of fostering rapid integration of the six economies of West African countries into a monetary union because of weak macroeconomic policy coordination within the ECOWAS sub-region, trade barriers, unstable exchange rate, and money and capital flow contracts limited formal intra-regional trade. In this regard, the paper argues that unless the fundamentals and the convergence of core macroeconomic instruments of fiscal, monetary and exchange rate policies are attained, improved upon and ensured by the integrating sub-countries, the achievement of a common monetary and economic union for the West African States may be elusive. This paper recommends the strengthening the fiscal, monetary and exchange rate policies performances by all the integrating WAMZ countries, and enforcement of the various regional agreements such as the ECOWAS trade liberalization scheme.

Keywords: European Monetary Union, Feasibility, Monetary Union, Regional Integration, WAMZ, West African Sub-Region

Suggested Citation

Nwankwo, Damian J. and Nwokoye (nee Nwabude), Ebele and Kalu, Chris U., Practicability of A West African Monetary Zone: A Conceptual Exploit (March 8, 2016). Unizik Journal of Economic Studies, 13(1), 64-76. Available at SSRN: https://ssrn.com/abstract=3312067

Damian J. Nwankwo

Coventry University

Priory Street
Coventry, CV1 5FB
United Kingdom

Ebele Nwokoye (nee Nwabude) (Contact Author)

Nnamdi Azikiwe University - Department of Economics ( email )

Enugu-Onitsha Expressway
Nnamdi Azikiwe University
Awka, Anambra
Nigeria

HOME PAGE: http://www.unizik.edu.ng/profile/nwokoyees

Chris U. Kalu

Nnamdi Azikiwe University

Enugu-Onitsha Expressway
PMB 5025
Awka, DE Anambra State 234
Nigeria

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