Department of Political Science,
Nnamdi Azikiwe University,
This article attempts to establish a linkage between globalization and integration. In the process attempts are made to examine the integration efforts at the West African sub-region prior to the new Universalism. Subsequently, the article ex-rays the extent globalization has affected activities in the West African sub-region. It suggests among other things that West African countries should embrace the benefits brought about by globalization and use them to do away -with high incidence of bad governance occasioned by corruption prevalent in the sub-region.
The phenomenon of globalization appears to be a product of renewed belief and contestations in a global process, which has drawn the international community at the threshold of a global village. These range from politics, economy, communication, and education to even agriculture and food. It has also led to criminal infections at a global level and such global health problems as AIDS. National economies, national culture and national boundaries are all dissolving and distinct management of national economies are all becoming irrelevant and giving way to globalized strategies characterized by powerful market forces. All forms of integration have also been a logical consequence of globalization. These include economic and monetary integration. These formations have affected not only domestic policies of States but also led to compromise of sovereignty and autonomy in domestic policymaking and implementation. Various levels of restructuring and governance as well as partnerships have been included within the context of its logical outcomes. The market scenario is dominated by powerful transnational that owe no allegiance to any state. It has also had some level of consequences for the civil society who are embroiled in migration, transnational economic activities and new citizenship.
This global phenomenon has not just begun. It has a history and chronology. Scholars such as Valaskakis (1999) traced its origin to the voyages of discovery of the 15thcentury. That was in Europe. Nabudere (2000) spanned it across five phases of development, which are dialectically linked dating it to the days of yore. Robertson (1992, 1994) notes that though there have been one form of relatively recent globalization, other forms had existed in the past. He cited the Soviet-led Communist Movement of the early 1920s, the Roman Catholic Church’s push to globalize its faith; the efforts of certain fractions Islamic societies to a global Islam; the Japanese governments attempt to create its own imperialism in Asia during the 1930s and early 1940s (Robertson (1992 in Nabudere, 2000). Hirst and Thompson (2002) note that globalization is not unprecedented. It is oneof the number of distinct conjunctures or states of the international economy that have existed since an economy based on modern industrial technology began to be generalized from the 1860s. They observed that even in some cases the present economy is less open and integrated than the regime that prevailed from 1870 to 1914. West African sub-region is not an island in the global process. As part of global community, events and activities in the sub-region have had their own logical outcomes, which could be attributed to the global-evolution. Part of this is found in the renewed vigour and efforts at coming together in addressing regional problems ranging from harmonization of security efforts, health, legislative activities and processes of adjudication. Over and above all is economic and monetary integration, which is believed to be a basis for rejuvenation and extractive capabilities of member states. Though there have been sporadic efforts in the past to come together, the present and renewed efforts officially received the blessings of the sub regional leaders in 1975. On the 29thof May 1975, Heads of State and Governments of West Africa signed a treaty setting up the Economic Community of West African States (ECOWAS). Today this effort at integration has taken a stronger dimension as a result of developments in Europe and North America leading to new roles, economic reforms and administrative innovations. The West African States appear very unlikely to be left behind in emerging global process, since activities by states in the sub-regions demonstrate reinvigorated desires to become active players in the ‘View deal’ in the interest of their citizens.
This article therefore attempts to establish a linkage between globalization and integration. In the process attempts are made to examine the integration efforts at the West African Sub-region prior to the new universalism. Consequently, the paper ex-rays the extent globalization has affected activities in the West African-Sub-region.
It suggests among other things that West African countries should embrace the benefits brought about by globalization and use them to do away with high incidence of bad governance occasioned by corruption prevalent in the Sub-region. This appears to be a major road map to economic and political development and successful integration. Consequently, conscious efforts should be made to democratize their economies in line with lessons derived from globalization. By so doing they could have created access to citizen participation net only in governance but also in economic management. Such efforts would improve service delivery, efficient administration, transparency, integrity and political stability. Poverty would have been reduced, crime reduced, and security improved. Integration would also facilitate the process of acquisition of Information and Communication Technology (ICT) in the governance process thereby reaping the benefits of electronic governance and building virtual West Africa.
Meaning and Nature of Globalization
The European Commission defined globalization as the process by which markets and production in different countries are becoming increasingly interdependent due to dynamics of trade in goods and services and flows of capital and technology. It is not a new phenomenon but the continuation of developments that have been in train for some considerable time (EC, 1997 in Thompson 1999). This kind of definition confines the understanding of the concept within the framework of international economy. It detracts from its interdisciplinary nature, which enables its usage for the analysis of the entire society as it concerns the social aspect of life, technology and political development. According to Ake (1995), it is a march of capital all over the world in search of profits, a process reflected in the reach and of multinational corporations. He contends further that it is about growing structural differentiation and functional integration in the world economy: it is about growing interdependence across the globe; it is about the nation-state coming under the pressure from the surge of transnational phenomena, about the emergence of a global mass culture driven by mass advertising and technical advances in mass communication. Ake also highlighted the unifying and diversifying characters of globalization:
It uniformalizes and diversifies, concentrates and decentres; it universalizes but also engenders particularities; it complexities and simplifies; always it is mediated and differentiated in form and content by historical specificities.
According to Grahame (1999), it embraces technological relations theory, modernization and development strategies…
Nature of globalization
|Space-time compression||Distant events and developments impact unevenly upon ‘local life’, including economic life, depending upon context and issue.||‘Distant events and developments impact powerfully and rapidly upon many aspect of ‘local life’, especially economic life.|
|Finance||Shares are readily traded between ‘national’ markets: Flows of finance and capital are growing substantially. The maintenance of currency values by national governments grows more difficult in the face of the pressures of international financial flows. Fiscal policies remain under the control of state governments but are subject to some growing external pressures and constraints.||Investment, borrowing and lending take place with no regard to national borders. There is a seamless global market for capital and finance, with 24hour trading and no barriers between the markets of different countries. Currency values cannot be controlled without the surrender of control of ‘national’ monetary policy. Fiscal policy is wholly dictated by ‘external’ factors and forces, as mobilecapital, management and skilled labour are able to relocate to areas with more favorable tax regimes.|
|Trade and business activities Society and Culture||Exports increase as proportion of GDP. Increasing levels of transitionally integrated production FDI increases but remain less significant, proportionally, than ‘domestic’ and/or regional levels More manufacturing is undertaken within home country or region’ proportionally. Increasing levels of R&D are undertaken ‘overseas’, but remain lower proportionally than ‘domestic’ and/or ‘regional’ levels. Non-domestic sales increase but remain lower proportionally than ‘domestic’/ or regional sales. Firms’ earnings from foreign activities are growing, but remain lower proportionally than ‘domestic’ and/or ‘regional’ earnings. Senior management of the TNCs is increasingly multinational, but foreign recruits remain lower proportionally than ‘domestic’ and/or ‘regional recruitment. International travel increases, but remain far lower than levels of ‘domestic’ level. There is increasing cross border contacts and trans-societal transmission of cultural products and cultural values, but the products and cultures of some cultures are more prominent than others are.||All goods and services are exported, save for those that have to be supplied and consumed locally. All goods and services are exported, save for those that have to be supplied and consumed locally. FDI exceed ‘domestic’ levels of investment and show; no territorial biases proportionally. Manufacturing activity is evenly is evenly distributed worldwide, with no territorial proportionality. R&D is evenly distributed around the world and shows no territorial biases proportionally. Firms’ sales are now worldwide and show no territorial biases proportionally. Firms’ senior management is recruited world-wide and shows no territorial biases. There are no territorial or societal, biases in patterns of interpersonal interaction and association. Culture is homogenous and worldwide, with all areas of the world contributing equally (or proportionally) to the new global culture.|
|Major Effects Theoretic implications||Increasing: Internationalization provides opportunities for economies and societies, but complicates the tasks, and prospects, of public governance. States are challenged, especially in areas of macro-economic policy, but retain substantial capabilities. Effective international public governance is likely to lie in reinforced intergovernmentalism and regime construction and/or regionalization of the world political economy. The international system is to be viewed as complex and uneven, with varying patterns of unilateral, bilateral and multilateral developments in different domains. The approach is essentially non-deterministic (merely posibilistic, or no more than probabilistic) about future developments.||Benign: There is new era of global opportunity and prosperity. A new global society emerges and new forms of genuinely global public governance are created. Malign: There is intensified global exploitation, economic and social disruption and resulting disorder. Effective public governance is compromised at all levels. The state, in particular has lost effective control of economic developments. The path forward from general disorder is uncertain and hazardous, with a considerable danger of revivalist nationalisms and other divisive-isms. Holistic tendencies are evident in the world system. A small of basic factors (or even one) are pushing the world, irresistibly and irreversibly, in one overall direction towards a transformed human condition.|
FD1- Foreign Direct Investment R&D- Research and Development, GDP-Gross Domestic Product, TNCs- Transnational Corporations. (Source : Jones, 2000)
The above table is quite revealing as it captures fully the nature of globalization and compares it with internationalism. One basic conclusion is evident from the analysis above. Internationalism is part of globalization process as the latter spans across internationalism. Secondly, the dominant feature of the both internationalism and globalization phenomena are increased economic activities, involving trade, investment, blurring of boundaries, and borderless activities with all their social and political consequences including detraction of national sovereignty. All these are propelled by advancement of in Information and Communication Technology (ICT). The development of the latter, opened more the international system, created greater awareness and increased access in the governance process thereby bridging the divided between producers both in government and private sector and end consumers in all their ramifications. In the process it created participatory management process and improved transaction both physically and electronically, hence the talk of e-commerce and governance. The analysis also shows that both internationalism and globalization have all created their own type of divides in terms of benefits accruing from various processes. The developed nations and developing ones have not been equal partners in both transaction and benefits. To some school of thought, this has only served to widen the gap between the rich and poor and engendered greater poverty and exclusion. However, one big question that remains unanswered is who is to blame for this ugly predicament. The third derivation from the table above is that the major actors in the whole imbroglio are the TNCs, States, the NGOs and perhaps the Civil Society Organizations (CSOs). To the extent that they are dominant actors, their activities are under limited control by States. Instead there is increasing tendency for the reverse, thereby making it possible for them to control state activities through the influence they exert on domestic and foreign policies. It is also possible to decipher that increased contacts have enhanced migration^ increased socialization, networking and tendency towards a homogenous world global culture and redefinition of legal frameworks and interpretation.
This redefinition also affects trans-border cooperation, immigration, custom, the civil society and citizenship. It intensifies the extent of internalization of economic relationships. It’s implication for governance is to the extent that it suggests the withdrawal of public authorities from the traditional role of managing and regulating the international system. Finally, it also possible derive from the table a move from domestic governance system to international governance system and multilateral cooperation which could help both developed and developing countries achieve some kind of balance of payment deficits and b$ extension improve the welfare and political stability of affected states. From the whole argument one can imagine a kind of Marxist and bourgeois divide on the globalization debate.
Haas (1958) and Lindberg (1963) conceptualized integration as an incubator-style process whereby existing political systems continuously ‘forgo the desire and ability to conduct key foreign and domestic policies independently of each other, seeking instead to make joint, decision or to delegate the decision making process to new central organs. It involves policy harmonization among member states. Edozien and Osaghie (1984) argue that whatever form integration takes, there exists certain common feature such as the surrender of some amount of national sovereignty to new supranational institutions. There is also an element of discrimination against non-members.
Economic integration in many parts of the world has always led to political unification. In the process of this unification, integration affects the sovereignty of the integrating units. To this extent, member states often find themselves constrained to conduct some key domestic and foreign policies independent of each other without putting into serious consideration the implications such would have on the overall interest of member nations. Integration involves a deliberate choice of supra-nationality over intergovernmental procedures of decision-making. This has often led to new structural formations that glue common interest and take decision on behalf of all. This according to Nwabuzor is line with the process definition, which emphasizes the development of joint or delegated decision-making and may or may not arrive at the maximalist goal of political unification.
Certain processes are essential for integration to be successful. One is the role of the decision elite and the institutional framework of decision-making. The role of the elite comes into focus in any effort to find out if the elite motive is internally or externally directed (Onu, 2003). Are the decision efforts meant to serve extra-regional interests or the regional interests? While the former may not serve the interest of integration, the latter may help integration process.
Another major factor worthy of consideration in the integration process is the bond of common historical past. Nwabuzor writes that the common fact of having been colonized may create some identitive bonds among ex-colonies. Such bonds are likely to be stronger if the states were colonized by the same power, suffered the same degree of deprivation and emerged from the experiences in basically similar conditions. The third
factor is the bond of interest. The more central the interests to ones existence, the stronger
the identitive bond is likely to be with another who share the same interest that has been
defined in zero-sum manner. Two types of interest sub-sets from here. These are interests
in accomplishing a common task of mutual benefits to the partners. The other is interest in
opposing a common enemy. There is a way in which this bond also makes some units to
accede to certain policies, which they cannot smoothly swallow in the interest of the
greater union. However compensation may come in form of promises of long-term
Edozien and Osaghie (1984) also identified elasticity of demand and supply as major
economic factor, which could determine the direction of integration. However, they
observed that some of these variables might not serve the African purpose because of their
European derivative. As a result has (1958) cautioned that:
It is dangerous to claim validity for the ‘European theory’ in societies which do not reproduce the physical conditions, ideologies, class structure, group relations and political traditions and institutions of contemporary Western Europe
Singer (1967: 19-20) outlined some factors, which could be useful in explaining the African situation with regard to political and economic integration. His position suggests the following:
- Integration is likely to be more successful when such a union is made up of
countries of equal economic importance. The existence of relatively advanced
member may give rise to fears of domination among some members.
- Integration would tend to be more beneficial when countries are at exceedingly small industrial base consisting almost entirely of processing of natural resource products and small-scale industries… In such a union there would be no vested interest, and the overriding problems would be one of ^he distribution of new industries created, rather than the compensation of countries with contracting inefficient industries. This stance is however questionable especially when one brings into focus and analysis the integrative efforts in Europe and North America-countries which are no longer battling with small industrial base, but complexity of industrial establishment.
- The integration idea stands a better chance of success if the size of each of the
members is not so large as to permit any one of them independently to
contemplate an essentially national policy of industrialization as an alternative
to regional co-ordination.
- Integration would have a better chance of success if it is backed by regional or
foreign sources of aid, channeled through special institutions whose objective
is to support the integration, idea. Member countries faced by declining
industries as a result of integration would easily obtain aid from such
institutions rather than opt out.
Whatever conditions posed as necessary for successful integration it is still important to appreciate the inevitable consequences of the political factors in the integration process. This is because efficacy of decision-making process at the domestic level is a necessary attribute of successful integration at the continental level (Onu, 2003). Large-scale political instability among the integrating units is a signpost for failure of any integration
arrangement. Deutsch, et al (1957) also identified certain factors, which inform successful
integration. The first is Mutual compatibility of main values. The values are those of
norms, which strongly influence the motivation for political behaviour in the member
states. The second is the belief within the community that the participants do possess a
distinctive way of life, with a set of socially accepted values and of institutional means for
their pursuit and attainment. This often includes the important aspects of the social and
political institutions of a recent past, either of all the members or of the important member
of the union. In some cases, however, the way of life requires a certain amount of
innovation, and a considerable amount of adaptation may take place after union if a
number of past social and political habits are in a state of change (Nwabuzor 1982).
The third factor is the existence of widespread expectation of mutual economic gains resulting from the union.
The fourth factor is the presence of a superior growth in some of the principal units before and during unification, which is said to have the capacity of paving way to integration. The fifth has to do with increase in the political and administrative capacity of one or some of the leading participants. The sixth factor is the presence of ‘unbroken links of social communication between political units involved.
The seventh factor is the continuous broadening of the political, social and economic elites. The eighth factor is a high inter-territorial mobility of persons, particularly those who belong to the politically relevant elites.
The emergence of well integrated nations of Continental and sub continental sizes in Europe and North America as a result of great disparity between their respective economic and political powers, and that of the rest of the world combined, has definitely influenced other parts of the world into taking practical steps towards regional economic integration (Nwabuzor, 1982 in Onu, 2003). In a similar vein, globalization has informed and conditioned the structure and nature of-post cold war integrative activities among nation states of international community as well as international relations. Globalization has also suggested greater, emphasis on emergence of many supra national organisations and arrangement to improve the economies of the nation states. The impression in the 21st century is that no region would survive the heat of the current wave outside the framework of supranationality.
The linkage between integration and international relations may border more on the opportunity provided by togetherness in the exercise of power among members of the unit, especially the dominant and economically stronger members. Secondly, the virtue of membership provides some air of not only domestic strength but also a feeling of security, which gives them bargaining strength with extra-regional powers. If the regional organization makes provision for military pact or defence treaties, possibility of external inversion from more powerful neighbours are likely to be limited. In such committee of nations as’ the United Nations, regional bodies with bond of unity have been taking advantage of bloc votes to press home issues of common concern to their members or even defended their members and regional interests. In the cold war era, developing states utilized the advantage of such phenomenon as non-alignment to survive the excruciating heat of the cold war.
In Africa integration is an expression of both the needs for satisfying the yearning and desires of the citizenry and that of nationalism. In an age of new universalism, African is left with little or no option than to come together, politically and economically whatever the costs are in order to survive and have a stronger voice in the committee of nations. This understanding is partly what informs the formation of the African Union with its accompanying ‘New Partnership for African Development’ (NEPAD). However, since our primary interest is on West Africa, we may have to review the situation in the sub-region before and what it is at the threshold of 21st century within the framework of the Economic Community of West African States.
Economic Community of West African States (ECOWAS) before globalization While the phenomenon of globalization took a center stage in public discourse in the closing part of 20th century and created greater, awareness in the early part of 21st century, plans for Economic Community of West African States (ECOWAS) were first formally set out at the Monrovia Group meeting of April 1968 (www.ecowas.org).
Since globalization started in the days of yore, the Economic Community of West African States (ECOWAS) only came into being on the 28th of May 1975 after a treaty signed in Lagos Nigeria by leaders of 15 countries that make up the West African Sub-region. To really talk of ECOWAS before globalization in any meaningful form is like attributing to a child the statutes of his father. It is therefore important to note that Organization entered into force in July, 1975. The first meeting of the Council of Ministers and the Authority of Heads of State and Government took place in Lome Togo, on November 4-5, 1976. During this meeting additional protocols to the treaty were signed. Sixteen West African Heads signed a revised treaty on July 24, 1993. The birth of this community was to an extent a response to a call by the Organization of African Unity (OAU) since its birth in 1963 for economic integration among African countries as well as that of United Nations Commission for Africa. The formation of ECOWAS was also informed more by the desire among the member states for political stability and industrialization than a quick response to the emerging global system. It was the dominant believe that an economically strong sub-region will create the much-desired basis for political stability and become less economically dependent on the extra-regional powers that most scholars and political leaders have blamed for being responsible for economic marginalization of Africa in the scheme of international economic order.
The Community is made up of English and French speaking countries. These include; Nigeria, Ghana, the Gambia, Sierra Leone, Benin, Guinea, Togo, Burkina Faso, Mali, Mauritania, Niger, Senegal, and Portuguese colony of Guinea-Bissau. Cape Verde joined later to make membership sixteen. The population of ECOWAS is about 210 million spread over a surface area of 6.4 million square kilometers. The GDP of the ECOWAS member states totals US$105 billion. Out of this Nigeria accounts for 51% of the regional GDP, while the rest of West Africa accounts for 49%. The Average investment rate stands at 18% of GDP. The resulting negative balances are covered mainly by external borrowing, which for the entire ECOWAS region, presently stands at US$72 billion. Real external debt service accounts for approximately 30% of the GDP, or three times the budget allocation for education and health, which records abysmally low development indices. The average school enrolment is 36%, while average life expectancy is 46 years for the entire sub-region. In 1997, exports from ECOWAS countries amounted to US5.5billion and imports $2.5 billion. The bulk of ECOWAS trade is with European Union, representing about 40% of the total trade, while intra-ECOWAS trade accounts for11%. (www.ecowas.org).
The purpose of establishing ECOWAS was contained in the Article 2 of the Treaty of Lagos.
It shall be the aim of the community to promote
cooperation and development in all fields of economic activity,
particularly in the fields of industry, transport, telecommunication,
energy agriculture, natural resources Commerce, monetary and
financial questions and in social and cultural matters for the purpose of
raising the standard of living of” its peoples, of increasing And
maintaining economic stability, of fostering closer relations among its
Members and contributing to the progress and development of the
In order to actualize these dreams, member states agreed in a treaty to:
- eliminate custom duties between member states. These include charges ofequivalent effect on imports and experts
- elimination from among themselves quantitative and administrative restrictions ontrade.
- the establishment of a common tariff structure and commercial policy towardsnonmember countries.
- the elimination of obstacles restricting are free movement of persons, services and capital between member states.
- the harmonization of agricultural policies and promotion of common projects in
the member states notably in the fields of marketing, research and agro-industrial
- The evolution of common policy in, and joint development of, transport,
communication, energy and other infrastructural facilities
- The harmonization of economic, industrial and monetary policies of members, and
the elimination of disparities in the level of development of members.
- The establishment of a fund for cooperation, compensation and development.
The ECOWAS was established to operate on the foundation of the following structures/institutions:
- The Authority: This is made up of Heads of State and Government.
- The Council of Ministers, made up of two representatives from each member state.
- The Executive Secretary.
- The Tribunal of the Community to ensure the observance of law and justice in the interpretation treaty of Lagos.
ECOWAS has also four technical and specialized commissions. These include;
- The Trade, Customs, Immigration. Monetary and Payments Commission.
- The Industry, Agriculture and Natural Resources Commission.
- The Social and Cultural Affairs Commission.
The Authority is the ‘principal governing institutions of the Community. It is responsible for, and has the general direction and control of the performance of the executive functions of the Community. It meets once a year and its decision are binding on all Community’s institutions (Osaghae, I978:11).
The Council of Ministers has responsibility for the review of the functioning and development of the Community. In addition, it makes recommendations to the authority on how best to achieve efficiency in Community management and administration and consequently gives direction to all subordinate institutions of the community. The Council of Ministers meets twice a year. However, this number of times could be exceeded in special circumstances.
The Executive Secretary heads the Secretariat. In addition, he is the Principal Executive Officer of the community in charge of day-to-day administration of the Community.
As we stated at the beginning, globalization the process of globalization did not just start. But prior to the establishment of the regional community, the states of West Africa States were on their own languishing from the aftermath of colonialism and neocolonialism. Even during the 20th and 21st centuries, the community is yet to adequately integrate. Though the vision for an integrated sub-region had been in the agenda of most African States, in West Africa, greater attention were devoted to cooperation between the states and their former colonial masters. Colonial heritage has left many of the states dependent on the metropolitan countries and this has tended to work against regional cooperation. Links with these former colonies continued to be more important than those with brother West African countries. Though ECOWAS came alive in 1975, the West African speaking countries in been in cooperative economic activities since independence. As Page and Bilal (2001) observed, there is no history of completely independent national trade policies, and no point at which a decision to integrate occurred. These states had targets of free trade and common external tariff and in longer-term free movement of services, capital and people and harmonization and mutual recognition of technical standards. Cote d’voire and Senegal were the strongest members economically. One political motive behind this formation was to counter the economic weight of Nigeria and perhaps Ghana for such countries as Cote d’voire and Senegal to extend their influence in the sub-region. The divide of monetary zones was one of the problems, which has been there before and after globalization. Before globalization no visible efforts were made to harmonize external policies of member states and trade patterns have to a large extent been informal. Though no statistics of informal trade appear to exists for now, Page and Bilal (2001) estimated about 20 to 50 percent of exports within the sub-region to have passed through informal trade (especially between such countries as Niger and Nigeria) and 75 to 80 percent between Nigeria and Benin to have flown through informal process. Such policies as structural adjustment have been implemented differently and significant efforts have been made at the regional levels to determine their impacts. What is witnessed in the sub-region is conflicting trade policies. The overall result of this range from discriminatory pricing policies as well as fiscal and monetary disparities.
Economic and Monetary Integration
Monetary and financial cooperation is an essential ingredient for successful economic integration. The benefits spans across solving the problems of indebtedness and balance of payment deficits; unfavorable terms of trade as a result of falling commodity export prices. It also becomes important because of the problems of the weaknesses of national currencies, high rate of unemployment and rapid population growth with the consequent falling standards of living. These problems have consequences not just for the economy but constitute threats to national survival.
It is a process of moving from the situation where each country or sub set of, countries within a region has its own currency or exchange arrangement, with different degrees of convertibility, into one where all countries within a region share a common currency and consequently a unified exchange arrangement under the supervision of a supranational monetary institution (McLenaghan, et al 1982, in Obadan and Egbon, 1994) A full monetary union, the type ECOWAS is adopting has the feature of full convertibility and unrestricted exchange of currency among the member nations which shall facilitate currency transactions. In such a case the rate of increase of money supply should be jointly determined.
Other implications of monetary integration include the acceptance of a common inflation rate, which does not imply the balanced growth of member countries (Obadan and Egbon, 1982). According to the latter, an adjustment cost will necessarily be imposed on members as a result of the adoption of a mutually agreed amount of credit expansion. Any budget deficit by a member is expected to be financed from the union’s capital market at the ruling rate of interest, and the balance of payment of the entire union in relation to the rest of the world must be regulated at the Union level. Tariffs and quotas are also to be eliminated. Monetary Union according to Tobin, James (1998), will enable local non-financial business to borrow, lend and sell shares in major international markets. Apart from this, it will facilitate the multiplication of volumes of currency transactions involving the economies of the sub-region as well as net flows of private capital into these economies.
Often times, countries get involved in monetary union primarily because of the conviction that such arrangement has the capability or prospects of improving their macro-economic stability and thereby increase economic growth which by extension could lead to political stability.
In West Africa, there is the believed that the establishment of a West African Monetary Union will reduce the problems of exchange controls and limit the use of foreign currency in the sub regional transactions. Secondly, nationals of West African Countries will be spared the trouble of applying for foreign exchange to pay for their imports from within the sub region. The problem of remittance charges for traders as well as postal and cable charges will be reduced. Since the IMF cannot meet up with the financial needs of every country, a West African monetary union might substitute for IMF. The establishment of Monetary Union has the effect of creating an international standard setting among the member nations. Some of these standards affect the conduct of trade and loan business. Domestic policies as they affect accounting and legal standards are matters of consequence. Nigeria for instance has a standard Organization, which is saddled with the responsibility of ensuring that goods that enter the country meet up with the minimum internationally accepted standards. The standard setting practices is capable of facilitating international trade and investment.
Leaders of West African firmly believe that Monetary Union has the efficacy to bring about the a perfection of financial market thereby bringing money market and interest rates in different financial systems close together.
Monetary and economic integration is also believed to have the capability of enabling the sub region identify her strengths and weaknesses, opportunities and threats and be able to design appropriate strategy for economic emancipation. This will help eliminate problems of poverty, mass illiteracy and dependency and periphery syndrome. The following are also identified as having constituted problems to the development of the sub region;
- the problems exporters experience in moving their goods by road across the various borders within the ECOWAS sub region. Transportation of goods by sea is hampered by non-existence of West African shipping lines designated to serve the needs of exporters and importers within the sub region. According to Jose, the experience of some intra ECOWAS exporters and importers is that their consignment would first be routed to Europe through Europe-bound vessels before arriving at their destinations within the ECOWAS region.
- Secondly, the- absence of adequate correspondent bank within the ECOWAS sub region has greatly hampered the promotion of intra ECOWAS trade. Letters of Credit (LC) between two trading partners within the sub region are usually routed through a correspondent bank in Europe. This process takes a long time. The experience of most exporters confirms that it takes up to 180 days to get an LC confirmed by correspondent bank. Apart from delays and its attendant disruption in business activities, the process also results in liquidity problems for the exporter who is compelled to wait for about 180 days before his export proceeds are credited to his accounts.
Economic integration and a monetary Union are bound to help in solving the problems highlighted above. Consequent upon this, article 37 of the Treaty of ECOWAS was designed to deal with the settlement of payments between member states and provides that: the trade, customs, immigration, monetary and payment commissions shall make recommendations to the council of Ministers On the establishment of bilateral systems of settlements of accounts between member states in short term and in long term a multi-lateral systems for settlements of such accounts (Akinyemi and Aluko, 1983: 220). Consequently, article 38 provides further for the setting up of West African Central Bank as follows:
- for the purpose of overseeing the system of payments within the community, there hereby established a Committee of West African Central Banks, which shall consist of Governors of Central Banks of member states or such other persons as may be designed by member states. The Committee shall be subject to this treaty, determine its own procedure. The Committee of West African Central Banks shall make recommendation to the Council of Ministers from time to time on the operations of the clearing system of payments and on other monetary issues of the community.
Subsequently, the Community had put in place the West African Clearing House, which started operations in 1976 and is charged with the following responsibilities:
- To promote the use of currencies of the members other transactions.
- To bring about economies in the use of foreign reserves of the members of the members of Clearing House.
- To encourage the members of the clearinghouse to liberalize trade among their respective-countries.
- To promote monetary cooperation and consultation among members of the Clearing House.
The need for monetary cooperation had spurred up bilateral systems of payments between some countries of the sub region. These include: Nigeria and Niger, Nigeria and Sierra-Leone, Burkina Faso and Ghana, Sierra Leone and Guinea, the Gambia and Senegal. The Franc zone was also able to establish a kind of multilateral monetary arrangement. These countries include Benin, Ivory Coast, Niger, Senegal, Togo and Burkina Faso. The respective currencies of these countries are legal tender in each other’s country (Ujewere, F.A. 1983) Once again the consequences of this development is to facilitate trade flows and payments among the member nations. Already the community has made it possible for a privately owned regional Bank to be established. That is the ECOBANK, There are also such other economic groups as Federation of West African Manufacturers Association.
Contrary argument however exists against the supposed benefits of monetary integration in West Africa. One of the issues raised in this context is the possibility of adopting a single currency for the sub region.
It is argued that adoption a single currency for West Africa raises question of the nature of currency. Will the countries of the sub region adopt the Naira, which happens to be the strongest currency in the whole of West Africa? Currently the Naira is accepted as a means of exchange in most West African countries. Acceptance of Naira in the neighbouring countries does not make it a preferred currency in such countries. The way an average Nigerian gets excited upon getting a US dollar is not the way Naira excites citizens of Nigeria’s neighboring countries. No West African currency is accepted in Nigeria’s domestic market the way Naira is accepted in the domestic markets of her neighbours.
Another issue concerns the colonial language bloc. The French speaking countries share a common CFA Franc- a development that is glaringly absent among the Anglo phone nations. The Anglophone nations have different currencies and do not share a common currency like the Franco phone neighbors. Unfortunately, the Franc is not as strong as such currencies as the Naira or Cedi.
The third issue is that of hegemony and sovereignty. A West African monetary Union is capable of threatening the monetary sovereignty of member nations especially when it likely that smaller nations will be nursing the fear of loss of autonomy over control differentials and that of becoming the monetary province of the country to whose currency its own is pegged. Such a union will also affect the monetary making policies of national banks as they may no longer be in rigid control of their currencies and render some national currencies obsolete. Tobin, James (1998) observed the issue of financial system liberalization as a logical consequence of monetary union. These hiccups in adoption of a currency suggests as Osaghae (1994) pointed out a difficult and long-drawn negotiations between officials of central Banks and other policy makers of member states. It also suggests removal of fixed exchange rates, which might mar the innovation. Added to this problem is the financial indiscipline and mismanagement among the countries of sub region, which veered from what, is obtainable among the Euro-members and which portends a potential disaster for a common currency.
CFA Franc still retains a reasonable degree of French influence. This disqualifies the CFA Franc as a common currency. These problems must have informed the launching ofECOWAS Travelers’Cheque on the 30th of October 1999 in Abuja Nigeria. The Travelers’ Cheque is issued and managed by West African Monetary Agency (WAMA) under the auspices of the committee of Governors of ECOWAS Central Banks. It is designed to serve as payment instrument to facilitate and promote trade, tourism and other monetary transactions within the sub region. The Travelers’Cheque is denominated in the West African Unit of Account (WAUA) and fully convertible into the national currencies of ECOWAS member states. The WAUA is at parity with the Special Drawing Rights (SDR) of the International Monetary Fund (IMF), and one unit of WAUA is currently equivalent to US$1.136(Punch, 26/7/99).
A monetary union will of necessity require the establishment of a supra-national bank, which will act as coordinating center for financial policies of member states. This will also lead to re-invigoration of intra-regional trade and investment among the countries of the sub-region. The long term consequences will be economic development and by approximation, more job opportunities, reduction in crime rate, decrease in poverty rate and political stability of member nations.
According to Osaghae (1994), operation of single currency, will require a decentralized banking system, with branches in selected countries which will bring out normal banking operations. It is also suggested that under such arrangement, experts who should be independent of national governments and whose terms of appointment should insulate them from political pressure should make monetary policies. Such a Bank should also maintain financial and price stability within the sub-region and a regime of exchange rates reflective of relative purchasing power.
Consequences of Economic and monetary Cooperation for the Civil Society
There does not appear at a universally accepted level, one single definition of the civil society. Some liken it to NGO; others refer to it as the non-state actors. But from all indications, while it is broader than just mere NGOs it is on the other hand narrower than non-state actors. According to the committee on global governance, the core civil society includes those citizens- based associations devoted to advancing any of a wide range of civic, cultural, humanitarian, technical, educational or social purposes, whether at a local, national, regional or global level. These groups according to the committee are the embodiment of citizen’s activism, from which they draw their vitality and legitimacy. The civil society is also offspring of popular or professional concerns of groups of people. They are not products of government edicts. They represent an interest group to the extent that they represent the interest of all members of the civil society, and not parochial interests of industry, firm or agriculture. Their source of finance is not from the government and they operate on non-profit basis.
Economic and Monetary integration of the countries of West Africa has a lot going for the civil society. One way this arrangement has benefited the civil society touches on the issue of migration. On Tuesday march 29 2000, a summit of leaders of ECOWAS countries decided that all check points on international highways within the Economic Community of West African States were to be dismantled. The mandatory residency permit was also to be abolished. Rigid border formalities were to be abolished and the Immigration officials were to accord maximum 90-day period of stay to ECOWAS citizens at the entry points by April 15 2000. Personnel at the border posts were to be limited to essential workers such as Customs and Immigration. An economic and monetary cooperation will facilitate cross border movement of members of the civil society of the sub region. There are many Yorubas and Igbos who are resident in Benin Republic either as traders, importers or exporters. Closeness to Nigeria and free movement of citizens have made it possible for businessmen to escape import rigidities of various Nigerian Military Governments. Half of fairly used vehicles used in Nigeria enter the country through her border with other West African Countries. These vehicles, which are prevented from entering.
Nigeria officially, have often attracted the patronage of both the members of the civil society and top government officials and other policy makers. This access has gone far in alleviating the transportation problem in Nigeria by selling vehicles at affordable prices. A market in Benin Republic for instance is named Biafran Market. This market is dominated by the Igbos of Nigeria who belonged to the territory of the defunct Biafran Republic. The name of this market makes Igbos feel at home in that country. Apart from this the Yoruba ethnic group territory spans across some countries of the West Africa. An economic integration and monetary union will help cement the relationship between the civil societies across the borders. Many of the citizens who are privileged to live near the border posts make their living in cross-border trade. A monetary Union will eliminate problems of money conversion at the border and cement relationship among members of cross border communities. With monetary union, the member nations will be in a position to establish an institution similar to the IMF, which will lend money at a more favorable rate than the IMF, which is the instrument of international capitalism designed to lift the economy of Europe. This will enable democratization of economies of member nations and reduction in the adverse consequences of the IMF conditionality, which have led to all sorts of structural adjustments. These conditions instead of helping the economies of member nation have instead added to their problems, leading to indebtedness and disenchantment in the benefiting nation and possible political instability.
It was the existence of ECOWAS, which led to establishment of ECOWAS Monitoring Group called ECOMOG. The suffering of the people of Liberia as a result of civil war was put to an end through the efforts of ECOMOG – an ECOWAS peacekeeping force. Without the peace keeping initiatives of the sub-region the war of all against all in Liberia would have lingered up till today and the civil society would have been worse for it. It will not only affect the monetary policies but re-channel fund meant for development to war activities. The same situation is the casewith the events in Sierra Leone. The intervention of the peacekeeping force was able to restore political stability in the countries mentioned above. It is only a politically stable nation, which can be in a position to protect the lives and properties of the civil society and develop economically.
The community has also developed a programme for village and pastoral water resources which led to creation of 3,200 water points throughout the region and 200 water points per member state. Between 1992 and 1996, attention waspaid to the needs of member states most seriously affected by drought and desertification. These include: Burkina Faso, Cape Verde, Guinea, Guinea Bissau, Mali, Mauritania, Niger, Nigeria, Senegal and Togo.
A West African Monetary Union has the capability of improving the domestic and international resource allocation. Interest rates could also be reduced on government debt. The social cultural ties among members of the region are capable of receiving a big boast through such activities as cultural festivals and sports competition.
Bhabha J, (1999) argues that regional integration problematizes the presumption of a privileged status between the state and its nationals. Effective regional integration it is argued depends on shared rights and obligations, non-discrimination between regional associates, and uniform mechanisms of governing inter-regional interactions. It could make possible some aspects of the special status of the nation-state as dispenser of citizen’s rights replaced by those of supranational bodies. Monetary integration with the West African sub region might be extended to the point where none of the members will be in the position to control their own economies as is the case with the EU members and as Bhabha argues, may logically compromise traditional sovereignty of member states as a consequence of cooperation in such areas as justice, policing and intelligence. Globalization of crime, and health problems such as the dreaded HIV will lead to cooperation across national boundaries in the areas of laws and their interpretation in order to arrest such problems.
The meeting of the speakers of West African national parliaments such as the one held in April 2000 has called and initiated action towards the formation of West African parliament. When this is actualized, such could lead to the Supremacy of West African laws over those domestic laws of member states. This is also bound to introduce changes into national constitutions. All these could in one way or the other have effects on the citizens’ rights. Such a development, which could lead to the establishment of the Supreme Court for West Africa, is capable of empowering the citizen to seek regional interpretation of domestic laws. It is only this court, which could interpret and apply the treaty of ECOWAS. In one of the judgments of the European Court of Justice, it was declared that the Community constitutes a new legal order of international law for the benefit of which the states have limited their sovereign rights, albeit within limited fields, and subject of which comprise not only Member States but also their nationals. Independently of the legislation of Member States, law therefore not only imposes obligations on individuals but is also intended to confer upon them rights which, become part of their legal heritage (Bhabha, J. 1999). A rail link from Lagos through Contonou to Lome and Accra which has been proposed and the introduction of Shengen type Visa and adoption of a common Passport are all aimed at lowering national boundaries and the creation of a single borderless market.’
What globalization has done therefore was to strengthen what has been started with greater conviction and resolve arising from lessons derived other regional blocs especially the European Union. ECOWAS cannot therefore be said to be a pre or post globalization formation but an organization designed to create a ‘one West Africa’ which came into existence within the context of universalistic evolutionary process which in the 20th century was popularly christened globalization and which was prompted by the socio-political and economic peculiarities of the sub-region.
It therefore more relevant to examine the extent globalization phenomenon has influences events in West Africa within the framework of the community. What efforts have been made so far to achieve some level of relevance within the framework of the emerging phenomenon?
Globalization and Economic Integration in West Africa
One major question expected to be raised here is whether the emerging globalization process has had any major impact on the process of economic integration in West Africa. Ifthe answer is yes, then what follows is ‘in what ways?’ Secondly, has the emphasis on globalizations-ought or is capable of bringing greater benefits to the sub-region? Over and above all, what has happened in the sub-region since the closing part of the 20th century?
Like we stated before, it is not as if the process of integration has just started in West Africa before the phenomenon of globalization became a catch phrase among states in the international-community. The purpose of greater emphasis on the subject matter has just served to create greater awareness and re-invigorate states of the sub-region to grow beyond mistrust and parochialism to adopt a rational approach aimed at coming together and harnessing the benefits of collectivity.
It is equally important to note that globalization has prompted greater developments in the sub-region under the auspices of ECOWAS whose members do not want to be left behind in the new wave. Heads of States and governments have at the behest of this phenomenon, attempted to implement many proposals and treaties, which for many years remained mere paper commitments.
One of the major achievements prompted by globalization is the adoption of two-track approach to the implementation of ECOWAS treaties. This approach allows two or more ECOWAS member states that are ready to cooperate in implementation of integration programs on a fast lane without being drawn back by those countries which are not yet in the position to move along with them on the fast track. To facilitate this, Nigeria and Ghana decided to give it a trial by working together in the following areas:
- Establishment of the second ECOWAS Monetary’ zone;
- Implementation of the ECOWAS Trade Liberalization Scheme;
- Establishment of the ECOWAS Free Trade Area;
- The ECOWAS Regional Infrastructure 1 Development Programmes; and
- Private Sector Collaboration.
Some other countries have joined Nigeria and Ghana in this efforts.
Secondly, globalization process has motivated the Implementation of the West African Monetary Zone (WAMZ), the monetary zone comprised of non-UEMOA member states, a proposal expected to lead to the establishment of the second Monetary Zone and second Currency by 2003. This was also expected to lead to eventual merger into a single Monetary Zone and currency by 2004. These efforts were approved by the ECOWAS Authority during the December 1999 summit held in Lome Togo. The WAMZ currency expected to be merged with CFA in 2004 to form ECOWAS currency.
Thirdly, a West African Monetary, Institute (WAMI) has been established and is headed by a Nigerian. One of the primary jobs of the Institute is to prepare ground for a common Central Bank, which is to be located in Ghana. The ECOWAS Authority has also approved USD5.4million for its take off.
Fourthly, the desire to keep track with the global wave has motivated the implementation of the ECOWAS Free Trade Area (FTA) programme. This programme involves the removal of all physical and non-physical barriers to facilitate free movement of persons, goods and services on the community highways, complete eradication of all rigid border formalities, the application the prescribed ECOWAS Customs and Immigration Procedures, implementation of joint border patrols and the adoption of a Common External Tariff (CET) for all import into the sub-region.
Serious consideration has also been given to infrastructural development and standardization of goods produced in the s-b-region. Unlike what the position was prior tothe 20thcentury, agreements were reached by Heads of State and government on the 27th March 2000 for:
- Monthly meeting of Security operatives for the review of security situation in the FTA;
- Quarterly meeting of Ministers of Internal Affairs/Internal Security;
- Joint Border Patrol;
- Exchange of Police Commissioners
- Exchange of list of miscreants.
In every economic integration efforts, revenue is being lost in the process of implementation of liberalization scheme. Ghana and Nigeria, which started the fast track approach, have implemented some of these including the issues of loss of revenue.
All visible road blocks between Nigeria and Benin Republic have been dismantled to facilitate free movement of goods and persons. Major agreements have also been reached on the Trade Liberalization Scheme (TLS). These include: the simplification of the procedures and adoption of single Goods Declaration Forms by Customs Services in ECOWAS, the exemption of goods valued at $500 or below from full customs declaration etc.
There is the approval for sub-regional infrastructural programme by Heads of States of ECOWAS. These include rail link between Lagos and Accra, electricity grids between Nigeria and Ghana. The acceleration of on-going projects such as the West African Gas Pipe line projects, the 2nd phase of ECOWAS Telecommunication Scheme (INTELCOM II), and completion of the remaining part of the Trans-West African Highways (Trans-Coastal from Nouakchott to Lagos). The Trans-Sahelian from Dakar to N’djamena. In all these, efforts have been made to involve the private sector in the integration process. This led to the initiation of the Private Sector Consultative Forum.
Efforts have also been made to establish the ECOWAS Compensation, Cooperation and Development Fund. The ECOWAS fund has been transformed into holdings to be known as ECOWAS Bank for Investment and Development (EBID), while the two subsidiaries are to known as ECOWAS Regional Development fund (ERDF) and
ECOWAS Regional Investment known as ECOWAS Regional Development fund (ERDF) and ECOWAS Regional Investment Bank (ERIB). The former will finance member states’ infrastructural development projects and programmes while the latter will
finance public sector commercially oriented investment projects.
All these are products of renewed efforts propelled by the globalization phenomenon.
The countries of the West Africa sub region are relatively new in the international system. With poor economies occasioned by weak industrial base, reliance on agriculture, these countries appear not to be in strong contention in the international5 competitive capitalism. Weakened further by corruption and political instability West African States have suffered more from vagaries of development in the international system. With a renewed emphasis on globalization and regionalism, Economic integration became an inevitable option to be adopted if a collective bargain and development must be achieved. With at least a paper commitment to improving the welfare of their citizenry and remain in strong contention in various global development the Economic Community of West African States was formed. With all its theoretical benefits, (whose accomplishment still remain at the level of structural development), the avowed objectives of the founding fathers shall remain a pipe dream in the face of mounting corruption which have bedeviled the political and economic development of the Sub region. This corruption has led not only to political instability but serious refugee problems and high incidence of crime across national boundaries.
The activities of the security agents at the border posts leave a lot to be desired. At the borders, neighbours are treated like criminals. The high incidence of extortion prevalent among the Police, the Customs and Immigration officials at the control posts leave a lot to be desired and pose serious threats to the much-orchestrated integration. This notwithstanding, discrimination against non-nationals is still prevalent in many of the member nations and there is yet no Supra national legal system or courts to protect the rights of non-nationals. The security agents at the borders even collude with criminals to effect transnational criminal activities. The extortion of money at border posts is done with such impunity and alarming rate that one wonders if all belong to same West Africa. Even the introduction of a common currency will still face the problem of counterfeiting and acceptance among users in the member nations.
Finally, even when we sounded pessimistic, recent developments and renewed vigor by current leaders of the sub-region and with various anti-corruptions programmes being executed across West Africa, there appears to be a candle at the end of the tunnel for the sub-region as more concrete efforts are currently being made to address the causes of past failures and at least for surviving as the strongest sub-regional organization in Africa.
Furthermore, as the process of integration is just beginning to take shape and may not be as perfect as that of European Union, ECOWAS succeeded in achieving what has been a difficult feet by restoring peace in such countries as Liberia and Sierra Leone, Cote d’lvoire, Equatorial Guinea, ravaged by conflicts proving the point that integration is better than disintegration no matter the level of perfection in implementation of terms of integration.
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