West African Monetary Zone gets a heavy lift from ADF

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The African Development Bank Group is to support the West African Monetary Zone (WAMZ) payment system development project with a grant of US$23 million from the African Development Fund (ADF).

Mohamed H’Midouche, Regional Resident Representative of the African Development Bank, inaugurating WAMZ in Banjul on Tuesday, said this project would directly benefit the Gambia, Guinea and Sierra Leone.

He added that the ADF was delighted to be associated with it as it had great potential to contribute to depending on regional economic integration and financial governance in the continent.

According to H’Nidouche, by developing the required financial infrastructure, and harmonizing the payment systems of the WAMZ member states, the project would catalyse the process for economic integration of the West Africa Monetary Zone.

He said this would enable beneficiaries to achieve important regional and national objectives by improving the efficiency of financial intermediation, management of systemic risks in the financial systems, liquidity management, monetary policy implementation and the general deepening of the financial sectors.

Dr. Temitope W. Oshikoya Director-General of West African Monetary Institute, said there was no doubt that the WAMZ payments system, which is generally rudimentary and mainly cash based, required surgical reform aimed at migrating to electronic modes of payments mechanisms that would be responsive to the users.

He added the system would minimize risks in payments; establish secure, convenient and integrated systems to meet the needs of the economy; facilitate a fast exchange and settlement of funds and securities; and improve macroeconomic management capabilities of the WAMZ.

“In the bid to launch a strong and stable monetary union, the West African Monetary Institute (WAMI) in collaboration with the WAMZ member countries, has successfully negotiated and secured a grant of US$23 million from the African Development Funds (ADF) for the modernization of the payment system in The Gambia, Guinea and Sierra Leone,” he said.

Dr Oshikoya added that this was to bring them to the same level as those in Ghana and Nigeria in order to facilitate the harmonization of the payments systems in all five member countries of the WAMZ – Nigeria, Ghana, Sierra Leone, Guinea and the Gambia.

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