Responding to Shocks and Maintaining Stability in the West African Economic and Monetary Union

By Christina Kolerus, Aleksandra Zdzienicka, Ermal Hitaj, Douglas J Shapiro

October 22, 2013

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Christina Kolerus, Aleksandra Zdzienicka, Ermal Hitaj, and Douglas J Shapiro. Responding to Shocks and Maintaining Stability in the West African Economic and Monetary Union, (USA: International Monetary Fund, 2013) accessed November 21, 2024

Disclaimer: The views expressed herein are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

The West African Economic and Monetary Union (WAEMU), like other monetary unions, faces a number of challenges in dealing with macroeconomic shocks. The region experiences a large number of exogenous shocks: climate-related (e.g., droughts, floods), with a heavy toll on populations and agriculture, but also economic (e.g., terms of trade), with a large impact on key sectors and the cost of living. More generally business cycle synchronization within the WAEMU seems low. Addressing these shocks, while preserving the stability of the union, is therefore a critical issue in the WAEMU.This paper discusses these issues and suggests possible reforms.

Subject: Business cycles, Debt sustainability, Debt sustainability analysis, Economic growth, Economic integration, External debt, Monetary unions, Public debt

Keywords: Business cycle, Business cycles, Current account, Debt sustainability, Debt sustainability analysis, DP, DPPP, Excess reserves, Exchange rate, Exports to Mali, Financial market, Global, Monetary unions, Trade elasticity, WAEMU country, WAEMU government securities market, West Africa

Publication Details

Pages:

41
Volume:

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DOI:

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Issue:

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Series:

Departmental Paper No. 2013/007
Stock No:

RSMSEA
ISBN:

9781484341186
ISSN:

2616-5333

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