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Signature of the Protocol of Agreement Statement by Mrs. Zeinab B. EL Bakri, Vice President, ADB Statement by Dr. Temitope W. Oshikoya, Director General, WAMI
OFFICIAL VISIT OF THE DIRECTOR-GENERAL TO THE AFRICAN DEVELOPMENT BANK AUGUST 4 - 6, 2008
The Director-General, Dr. Temitope Oshikoya, paid an official visit to the African Development Bank (AfDB) from August 4 to 6, 2008. He was accompanied by the Chief, Payments System Division of Operations Department, West African Monetary Institute (WAMI), Mr. Twum Ohene-Obeng. The primary purpose of the visit was to sign the Protocol Agreement for the Payments System Development Project (the Project) in three of the WAMZ Member States namely, The Gambia, Guinea and Sierra Leone.
The African Development Fund (ADF) has approved a Grant of UA14 million (US$23 million) for the development of Payments System in the three WAMZ Member States. WAMI, by the approval of the Convergence Council, brokered the Grant Agreement with the AfDB. The highpoint of the collaboration between WAMI and AfDB in relation to the Payments West African Monetary Zone (WAMZ) Payments System Development Project was the formal signature of the Protocol of Agreement which took place at the AfDB Headquarters in Tunis, Tunisia, on August 4, 2008.
The Director-General while on the official visit, took advantage of his previous position as the Director of Research at AfDB to make requests to various departments of the AfDB for Technical Assistance to support the work programme of WAMI.
This Report sets out the outcome of the visit, including the decisions reached with each department of AfDB.
II Signature of the Protocol of Agreement
The Protocol of Agreement document was signed by Dr. Zeinab El-Bakri, Vice-President of AfDB responsible for Sector Operations (OSVP) for the AfDB and the Director-General for WAMI. Present at the ceremony were officials from the office of the Executive Director, Dr. Mansur Muthar, Legal Department and Mr. Damoni Kitabire, Lead Economist, Governance (OSGE). The Vice-President reiterated the primary objective of the Project as the improvement of the payment systems in the three WAMZ member countries so as to enhance the performance of their financial systems and improve their general economic efficiency. She said that the AfDB was hopeful that the Project would translate into economic well-being of the people of the West African region and improve their standards of living. The speech delivered by the Vice-President is annexed to the Report (Annex 1).
In response to the speech delivered by the Vice-President, the Director-General, on behalf of the West African Monetary Zone (WAMZ) Authorities, WAMI and on his own behalf expressed gratitude to the President, Board of Directors, Management and Staff of AfDB for the Grant of UA 14 million (US$23 million) to develop the Payments System of The Gambia, Guinea and Sierra Leone. The Director-General ceased the opportunity to outline the activities of WAMI and explore how the two Institutions could further strengthen collaboration. He assured the Board and Management of AfDB that the Project would be efficiently executed and implemented within budget and implementation timeframe. The speech of the Director-General is annexed to the Report (Annex 2).
Meetings were held with the following Departments (Annex 3) and the decisions reached are stated below:
i. Statistics Department (ESTA)
The Statistics Department agreed to:
♦ Send a member of staff to WAMI to appraise the state of statistical environment, in terms of ICT and database system software, staff capacity and recommend appropriate training.
♦ Install the World Bank designed statistics prototype software, Data-Platform for publishing, disseminating and managing database. (Other institutions, beside the AfDB, that use the World Bank Data-Platform include Afristat and Islamic Development Bank).
♦ Add WAMI to its mailing list for publications issued by the AfDB.
ii. Governance Department (OSGE)
Governance Department prepared the Appraisal Report for the WAMZ Payments System Development Project and has hitherto served as the Task Managers for the ADF Grant. In furtherance of their efforts, it was agreed that:
♦ The launch of the Payments System Development Project in The Gambia, Guinea and Sierra Leone should be postponed to the first week of September, 2008, to allow AfDB send a Procurement Officer and a Grant/Loan Disbursement Specialist to brief the Project Co-ordinators of the three countries and WAMI Project Implementation Team.
♦ AfDB would publish all Invitation for Bids in the UNDP bulletin as a measure to hasten the engagement of Solution Providers for the various components and promote the transparency required by WAMI.
♦ An AfDB Task Manager for the Project would be appointed in due course and communicated to WAMI.
iii. Audit Department (OAGL)
The Audit Department pledged their willingness to assist WAMI with its work programme. The Director-General’s request for Technical Assistance in the form of a visit to WAMI by an AfDB official to offer on-site assistance was agreed upon. The immediate assistance to be provided by the Department would be the provision of AfDB Audit Manuals to WAMI.
iv. NEPAD, Regional Integration and Trade Department (NEPAD/ONRI)
The NEPAD/ONRI Department which has been supportive of the WAMZ Programme expressed their readiness to assist WAMI in various forms:
♦ Fund the engagement of a Consultant to prepare Audit and Accounting manuals.
♦ Contribute to the funding of the infrastructural build up for the West African Central Bank (WACB).
♦ The Department has engaged a Consultant to determine which system of common Central Bank, federal versus unitary, should be adopted for the WACB.
♦ On the issue of Capital Markets integration, WAMI should repackage the request as a regional project and delineate the role of other institutions, such as USTDA and Commonwealth Secretariat.
♦ The implementation of Customs Export/Import Tracking System (as operated by the Ghana Community Network (GCNET) system was being considered for all the other 14 ECOWAS member countries together with Business-Climate and African Business Round-table Conference. WAMI should therefore liaise with ECOWAS Commission and package the request as a regional project, if what has been initiated by ECOWAS was different from the dimension being considered by WAMI. v. Cooperation Department (ORRU)
The Department urged WAMI to seek financing under the Nigerian Technical Cooperation Fund for capacity building or other engagements that would not exceed US$250,000 in a financial year. The Director-General said that WAMI would tailor its need to meet the conditions of the Cooperation Fund, especially for capacity building.
vi. Development Research Department (EDRE)
The Director-General requested for the Department to carry out a study on behalf of WAMI on the Exchange Rate Regime and consider whether fixed, flexible or other permutations should be adopted by the WACB. It was agreed that the Department would adopt the study and undertake the preparation of a background paper to identify the depth of the issues involved, the relevant analysis and sample the opinion of stakeholders through workshops.
vii. Human Resource Management Department (CHRM)
The Director of the Human Resource Department outlined four facets of human resource administration which were themselves undergoing reforms at the AfDB. The facets identified were:
· Performance Management, · Human Resource Strategy, · Compensation and Benefits Policy, and · Pension Plan.
The Department provided recent strategy papers on the above issues and agreed to engage to engage a Consultant to assist WAMI in the design of human resource policy framework for the WACB under Technical Assistance. The staff of the Department will coordinate the work of the Consultant.
viii. Financial Control Department (FFCO)
The Division Manager, Mr. Odukomaiya, met with the WAMI team and upon request by the Director-General for assistance in building a sound financial management system, he outlined the essential features of a good financial system that could embodied in a Manual. He offered the manual that guides disbursements under the Nigerian Trust Fund. As to whether the Department could provide Technical Assistance to assist WAMI in designing a good financial control system, he deferred the decision to the Director and promised to revert to WAMI when the Director resumes duty.
ix. Legal Department (GECL 1)
The Legal Department provided documentation on the organization of the Department. In respect of Technical Assistance by which staff of the Department would visit WAMI to assist in the framing of a Legal Department strategy, the Manager said that a request should be made to the General Consul.
IV Conclusion
The mission to the AfDB undertook by the Director-General was a one-stop encounter that involved various programmes. More assistance from the AfDB was sought and before the end of the year, staff of WAMI would have to brace themselves up for heightened activities, with the involvement of AfDB staff. Leveraging his previous position with the AfDB as the Director of the Research Department to establish strong cooperation between WAMI and AfDB, the Director-General could revamp the WAMZ Programme toward achieving its set objectives.
WAMZ PAYMENTS SYSTEM DEVELOPMENT PROJECT
STATEMENT BY THE VICE PRESIDENT, MRS ZEINAB B. EL BAKRI, AT THE SIGNING OF THE GRANT AGREEMENT FOR THE WAMZ PAYMENT SYSTEM DEVELOPMENTPROJECT TUNIS, 4 AUGUST 2008
The Director General, Distinguished Audience, Ladies and Gentlemen,
On behalf of the President of the Bank Group, the Staff and on my own behalf, I would like to take this opportunity to warmly welcome the WAMI delegation to the Temporary Re-allocation of the African Development Bank. It is indeed a great pleasure for the African Development Bank Group to host this occasion of the signing of the Grant Agreement for the support to the WAMZ Payment System Development Project, for an amount of UA 14.00 million from the African Development Fund (ADF) which is equivalent to about USD 23 million. Much as this project will directly benefit The Gambia, Guinea and Sierra Leone, we are convinced that it will contribute to further developing the West African region and the Continent as a whole.
The primary objective of this project is to improve the payment systems in the three countries so as to enhance the performance of their financial systems and improve their general economic efficiency. We at the Bank trust that this will translate into the economic well being of the people of the region and improve their standards of living.
The project will finance the initial stages of financial integration that will catalyze the process for West African Monetary Zone promoting regional integration. This will enable the beneficiaries of the project to achieve important regional and national objectives by improving: (i) the efficiency of financial intermediation, (ii) the management of systemic risks in the financial systems; and (iii) liquidity management, monetary policy implementation, and the general deepening of the financial sectors. Overall, the project will facilitate the move to a currency common to all and boost integration to the economic and monetary union in WAMZ, resulting in a larger regional market. The project will have positive economic benefits on the population in the WAMZ, especially those most active in regional trade or cross-border trade. We envisage that this project will promote good governance and transparency in transactions and also assist in the anti-money laundering initiatives.
In closing, allow me to reiterate our appreciation for the excellent relations between the Bank and WAMI Staff and the good cooperation in preparing this project. I would like to reiterate our support to the people of WAMZ, and to assure you of the continued support of the Bank Group to the programmes pursued by your governments aimed at enhancing good governance which is a necessary condition for development.
Thank you for your attention.
STATEMENT BY DR TEMITOPE W. OSHIKOYA, DIRECTOR GENERAL OF THE WEST AFRICAN MONETARY INSTITUTE ON THE OCCASION OF THE SIGNING OF THE PROTOCOL OF AGREEMENT
The Honourable Vice President, Ladies and Gentlemen,
It gives me great pleasure to be among my colleagues and friends at African Development Bank (AfDB) today to sign the Protocol of Agreement between the African Development Fund and the West African Monetary Institute (WAMI) in respect of the Grant for the development of the payment systems in the member countries of Gambia, Guinea and Sierra Leone. Your Honourable Vice President, on behalf of the Convergence Council of Ministers and Governors of the Central Bank, I would like to express the appreciation of the West African Monetary Zone (WAMZ) and its Institute, WAMI, to the President, Board of Directors, Management and Staff of the AfDB for the Grant of UA 14 million (USD23 million).
The primary objective of creating the WAMZ is to promote trade, growth and eradicate poverty in the sub-region. The project is designed to lead to the creation of a common central bank, the West African Central Bank (WACB) and the introduction of a single currency for the member countries of WAMZ. This Grant therefore represents a watershed in the WAMZ Project. It marks another major leap in our march towards a Monetary Union and a significant step in the establishment of a robust, safe and efficient payments system that can act as a model for the African Continent in general and West Africa, in particular. For the three countries it means a direct benefit for participation in the WAMZ Project and another strong reason to demonstrate their continued commitment to the WAMZ Monetary Union Project.
This project, when fully implemented, will go a long way in addressing the challenges of payment systems in the Gambia, Sierra Leone, and Guinea. The upgraded payment system should facilitate control of credit and systemic risks, leading to increased confidence in the security and reliability of payment; minimisation of transaction costs; availability of modern infrastructure to support domestic and cross-border funds transfer; improved monetary/liquidity management and promotion of economic activities. It will also promote efficient allocation of resources, financial intermediation, and the efficacy of monetary policy.
Your Honourable Vice President,
Please permit me to use this opportunity to outline the activities of WAMI and how we can further strengthen collaboration between our two institutions. WAMI was set up in 2001 as a precursor to the establishment of the WACB, and charged with the mandate of actualizing the WAMZ project. The major responsibilities include, monitoring the state of macroeconomic convergence of the member countries vis-à-vis the prescribed benchmarks; harmonising regulations on financial markets in the member countries; Promoting the development of the payments system in the member countries in order to facilitate the smooth execution of monetary policy operations and efficient transfers within the zone; designing an exchange rate mechanism; and, undertaking a sensitisation programme to educate all the stakeholders in the zone on the monetary integration process.
I have the honour to inform you that significant progress is being made towards the monetary union. WAMI has been discussing with various complexes of the Bank on possible areas of further collaboration. The areas identified include: Statistical Harmonisation and Database Development; Financial Sector Integration in the WAMZ; Preparation towards the introduction of the single currency- Eco; and programmes for promoting regional development and integration, as they will ensure an effective integration of the West African countries into one single economic space. Madam Vice President, your assistance in actualizing and strengthening further collaboration will be highly appreciated by the Board and Management of WAMI.
Permit me to conclude by assuring you that with the signing of the Protocol of Agreement, the current project will be efficiently executed and implemented within budget and implementation timeframe.
With these remarks, Honourable Vice President, it gives me great pleasure to sign with you this Protocol of Agreement.
Dr. Oshikoya’s Visit to ADB Appointments details
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