The AfDB Group has launched a project to contribute support for the development of the domestic debt markets and financial systems in four West African Monetary Zone (WAMZ) countries.
Countries that are beneficiaries to this initiative include: Sierra Leone, Guinea, Liberia and the Gambia. The Bank has committed UA1.5million, equivalent to $2 million in total as grants for the project.
Funds earmarked for the project will drive several facets of the development of the domestic debt market. Spanning from the provision of technical assistance to capacity building in the four countries.
Other Partners to the Project
More specifically, the project aims at providing support for the deepening of primary debt markets, improvement of debt market infrastructure, enhancement of institutional capacity in relevant agencies and authorities and a broadening of the investor base.
Dr. Olorunsola Olowofeso, the Director-General of the WAMI said that: “We are delighted with the partnership with the African Development Bank to support financial systems development in the WAMZ, particularly in the area of technical assistance and institutional capacity building.
He further added that, “it is our desire to see further deepening in financial integration and cross border operations in the Zone.”
The West African Monetary Institute (WAMI) is the implementing agency on behalf of the four WAMZ countries. The WAMI undertakes technical preparations for the establishment of a common West African Central Bank including the launching of a single currency for the WAMZ.
Originally, the number of countries that form the WAMZ is six West African countries including Ghana and Nigeria.
“Debt market development will facilitate increased intermediation of capital, both for public and private entities. It is aligned with our vision for the emergence of well-functioning and resilient financial and capital markets in African countries.”Stefan Nalletamby, Director for Financial Sector Development Department,
Furthermore, the West African Monetary Institute (WAMI) will work closely with the participating countries to implement the project.
Likewise, this serves to build on the upgrade of central bank payment systems in the four countries.
Furthermore, AfDB Group funding will complement existing initiatives to enhance the development of financial systems in WAMZ. countries.
Previous Support to the WAMZ
This is not the first time the Bank has offered such support to the WAMZ. In 2008, the Bank Group committed a total of 14 million Units of Account (UA), equivalent to $23 million to the WAMZ.
During which period, the Bank financed part of the WAMZ payment system development project. This was a land mark project which involved the development of a regional financial infrastructure for actualizing the WAMZ.
Furthermore, it was aimed at upgrading the payment systems in three WAMZ countries. The main purpose was to facilitate the harmonization of the payment systems in five of the member countries of WAMZ.