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International Development

The New Economic Partnership for
African Development (NEPAD)

Mainstreaming The Activities of
The Central Bank of Nigeria (CBN) into NEPAD

The New Economic Partnership for African Development (NEPAD) is a continental idea conceived by Nigeria and the Republic of South Africa and adopted by African leaders at the African Union summit in Lusaka, Zambia, in July 2000. The goal of NEPAD is to eradicate poverty in Africa and to place African countries both individually and collectively on a path to sustainable growth and development to halt the marginalization of Africa in the globalization process.

The Central Bank of Nigeria (CBN) is charged with the responsibility for formulating monetary policy and programs for the economic development of Nigeria. Some of the Bank’s policies touch directly on poverty eradication and so bear on NEPAD’s goal of acceleration of the eradication of poverty and inequality on the continent. Thus, such policies like the Micro Finance Policy, Regulatory and Supervisory Framework for Nigeria in addition to other financial sector policy reforms address the concerns of NEPAD.

African Peer Review Mechanism

One of the instruments of NEPAD is the African Peer Review Mechanism (APRM). It is a mutually agreed instrument voluntarily acceded to by the Member States of the African Union (AU) as an African self-monitoring mechanism. The APRM is a bold, unique and innovative approach designed and implemented by Africans for Africa . The APRM aims to put in motion a strategic re-orientation towards the validation of universal as well as African values and accelerate the process of intra-African cooperation and integration. The APRM therefore will be a key driver of African renaissance and rebirth, and is a centre piece of the NEPAD process for the socio-economic development of Africa . There are currently 27 countries participating in the African Peer Review Mechanism including Nigeria .

The APRM and NEPAD in Nigeria were previously separate, but they were merged in September, 2007.

Nationwide Validation of the Country Self-Assessment Report (CSAR)
A nationwide validation of the Country Self-assessment Report (CSAR) on Nigeria under the African Peer Review Mechanism (APRM) was conducted between 18 th November and 1 st December, 2007 by the National Working Group of APRM, Nigeria . Nigeria is currently undergoing the final stages of the peer review process which will culminate ultimately in her being peer reviewed in July, 2008. The draft Country Self Assessment Report was prepared by the New Partnership for Africa's Development (NEPAD), Nigeria , as a basis for the peer review. The report contained the perceptions of Nigerians on the quality of governance in the country, and proffered a roadmap for addressing identified challenges and weaknesses with a view to evolving better governance practices.

Realizing that the perspectives of critical stakeholders may not have been adequately captured, the report was subjected to nationwide validation workshops to facilitate inputs to the document by important segments of the Nigerian population with the aim of strengthening it and to promote its ownership and sustainability. Earlier, the Federal Government had set-up a National Working Group (NWG) made up of eminent persons, important Non-Governmental Organizations (NGOs), Civil Society Organizations (CSOs), governmental institutions, the media, labor and trade associations, and other critical stakeholders, as a key structure of the APRM with the responsibility to facilitate and manage the validation exercises. The Governor of the Central Bank of Nigeria , Prof. Chukwuma C. Soludo is a member of the NWG.

The NWG was divided into 4 teams, with each team assigned to cover a group of 3-4 states making up the 14 validation centers into which the country was divided. Each team of the NWG visited the validation centers using the CSAR as the primary instrument of validation. The validation centers were Borno, Adamawa, Benue, and Plateau States for Team 1; Akwa-Ibom, Bayelsa, Imo, and Anambra States for Team 2; Sokoto, Katsina, and Kwara States for Team 3; and Ekiti, Ogun, and Edo States for Team 4. At each validation center, a power-point presentation of the CSAR was made to the state and non-state stakeholders during a two day workshop by the APRM thematic consultants and members of the NWG. The presentations covered the four thematic areas of governance identified by the APRM process notably: Democracy and Political Governance; Economic Governance and Management; Corporate Governance; and Socio-Economic Development. The presentations were followed by 4 concurrent thematic break-out sessions during which the inputs of the participants into the document were harvested. The inputs from the respective thematic groups were presented when the workshop reconvened in a plenary, to enable other members agree on the concerns raised. Thereafter, all the inputs were synthesized into zonal validation reports to be used in revising the draft CSAR and National Program of Action (NPoA).

The sub-national validation workshops lasted from 18 th November, 2007, to 1 st December, 2007. These were followed by further validation exercises at the national level culminating in a final national stakeholders' workshop on 11 th December, 2007 to be chaired by Mr. President, Alhaji Umaru Musa Yar'Adua. The Central Bank of Nigeria is a member of the NWG, The validation workshops were held concurrently at all the validation centers, and information for this report covers all the teams.

The Central Bank of Nigeria is participating in the validation exercise for Nigeria 's review .

Central Bank of Nigeria & NEPAD

African Finance Corporation
The Governor of the CBN Professor Charles Soludo conceived the idea of building a unified Regional Economic Space towards joint implementation and monitoring of African Partnerships in the financial and private sector. To this effect, the infrastructure for the formation of an African Finance Corporation (AFC) is already being established. The AFC is a private-public sector partnership with the private sector having majority shareholding. It is expected that it will enable the region’s private sector to participate in regional investments, especially in infrastructure and privatization of companies. All Nigerians, Africans and international investors will have the opportunity to invest in the AFC. An international investment bank will soon be appointed as issuing house for private placement. The AFC is expected to take-off in the last quarter of 2006.

The ECOWAS Monetary Integration Programme
NEPAD’s vision of translating its priorities into a West African strategy includes Economic Integration and Intra-African Trade. The Central Bank of Nigeria has been in the fore front of ensuring the success of the ECOWAS Monetary Integration Programme. It is envisaged that the successful take off of the programme will lead to the commencement of the Single Monetary Union in the African Union (AU) in line with NEPAD objectives. Below are the institutions which were established by the Heads of Governments of the respective African States to facilitate the creation of a common central bank in the Sub-Region. From 1979-2001, Nigeria’s 29.66% contribution to the ECOWAS budget has been the largest single contribution.

  1. WAMI: The West African Monetary Institute was set up in Accra, Ghana in January 2001 to facilitate the creation of a common central bank and the introduction of a common currency. The Institute which would undertake technical preparations for the establishment of a common West African Central Bank started operations in March 2001. Its functions includes:
    1. monitoring of macroeconomic convergence of the member countries vis-�-vis the prescribed benchmarks;
    2. harmonization regulations and design of policy framework;
    3. Promotion of the Regional Payment System;
    4. conduct studies on exchange rate mechanism and conversion rate;
    5. organisation of sensitisation programme for the citizens of the member countries; and
    6. the design and technical preparation of the new currency, etc.

  2. WAMZ: The failure of the ECOWAS integration process to make significant progress since its inception in 1975 was one of the motivating factors for a new approach to integration- that is the ‘ Fast Track approach’ to monetary integration in the sub-region. The political commitment to renewed economic cooperation was spearheaded by Nigeria in 1999. As a result of the foregoing, the 2nd West African Monetary Zone, which is a group of 5 countries in ECOWAS, agreed to work towards introduction of a common currency, the Eco (currency) by the year 2009. The 5 member states are Gambia, Ghana, Guinea, Sierria Leone and Nigeria.

  3. WAIFEM: West African Institute for Financial and Economic Management is a sub-regional training institute whose principal objective is to build capacity for debt, macroeconomic and financial sector management in its constituent countries. WAIFEM was established by the Central Banks of The Gambia, Ghana, Liberia, Nigeria and Sierra Leone to strengthen capacity of public sector officials engaged in macroeconomic and financial policy formulation and implementation. As at the end of December 2004, WAIFEM had executed 142 capacity building programmes involving 4,021 participants of which 1,905 of them were from Nigeria.
  4. WAMA: The West African Monetary Agency is an autonomous specialized agency of the Economic Community of West African States (ECOWAS). In 1996, the West African Clearing House (WACH) which was established in 1975 as a multilateral payment agency to improve sub-regional trade in West Africa, was transformed into a broad based autonomous agency called the West African Monetary Agency (WAMA). WAMA's Headquarters was officially inaugurated on the 28th November 1996. The Agency is concerned with monetary co-operations and payment issues within the context of economic and monetary integration process of the region in line with NEPAD's continental objectives

    Presently, Nigeria’s 22% contribution is the single largest contributor to the WAMA budget.
  5. Association of African Central Banks (AACB)
    The Association of African Central Banks was established in February 1965. The objective of the Association is to promote co-operation in the monetary, banking and financial sphere in the African region and to assist in the formulation of guidelines along which future agreements between African countries can proceed in the areas already identified. The objectives of the AACB is in line with NEPAD's objectives of promoting integration in the African continent.

    The Association has an Assembly of Governors (the governing body of which are members all African Central Banks Governors), a Bureau (composed of the Chairperson and the Vice-Chairperson of the Association and Chairpersons of sub-regional Committees), sub-regional Committees (composed of Governors of Central Banks of the five (5) sub-regions as defined by the African Union). Membership of the Association and its Sub-regional Committees is open to all Central Banks of member countries of the African Union.

    Nigeria signed the instrument of accession to the revised statutes on November 6, 2003.

Visit The NEPAD website - http://www.nepad.org/

Facts : 1/1/1966
Central Bank of Nigeria, Enugu Branch:In the year 1966, The Central Bank of Nigeria Branch in Enugu was opened.It was the fourth Central Bank Branch that was established, bringing to 4, the number of Central Bank offices in Nigeria at that time.
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