The leaders of the 15-nation group known as ECOWAS (Economic Community of West African States) have agreed to introduce a shared currency that will be launched in 2020.
The agreement which was made in Abuja, Nigeria over the weekend, also heralds the call for greater structural reforms in West Africa.
An issued statement at the summit said that the authorities had adopted ECO as the name of the planned currency. Representing about 385 million people in West Africa, the bloc acknowledges a 2018 report that underlines the worsening of the macroeconomic convergence.
ECOWAS implored all member states to double down on improving their performance in order to meet up with the requirements for establishing a monetary union.
The leaders directed the commission to join forces with the West African Monetary Institute as well as the central banks to speed up the implementation of the revised Roadmap with respect to the symbol of the single currency.
It also instructed for the acceleration of the operation of the Special Fund for the financing programs in the revised roadmap for the ECOWAS Single Currency Program.
While the adoption of ECO is a move believed to solve the region’s economic problems, ECOWAS chairman and Nigerien President, Mohamadou Issoufou, said the commission is of the view that “Countries ready for the launch will adopt the single currency and those unprepared will join the program will they meet with the six convergence criteria”. He said there is a “real firm political will to increase efforts ahead of the January 2020 deadline.
According to the communique read by Permanent Secretary, Ministry of Foreign Affairs (Nigeria), Mustapha Suleiman, the commission should ensure the implementation of the recommendations of the meeting of the ministerial committee held in Abidjan on June 17 and 18.
It also urged that member states should earnestly prepare and implement the Communication Strategy pursuant to the adoption of the single currency program.
Time seems to not always be on the side of African regions that want to adopt a single currency. In a related development that transpired last month, The EAC bloc said that the adoption of an East African currency would take longer.
WeeTracker reported that the hiccup was as a result of progress by member countries being slower than expected. Officials revealed that most of the member states would likely not meet the final pair of criteria by 2021 as they have only managed to achieve the first two.
Analysts always have something to say, particularly that adopting single currencies is a new ground African countries should tread on cautiously. Concerning ECO, one told Aljazeera that the common currency on its own does not have what it takes to make doing business any easier than it is in West Africa. That means the adoption of the single currency alone will not lead the charge for boosting intra-regional trade.
Currency has been a hot topic in the continent as of late. Zimbabwe rebased its economy following the shift from what was called the Zimbabwean dollar to a newer currency known as RTGS dollars. Apparently, the Zollar lost its value and experienced a maxi-devaluation of 60 percent.
Last month, the Central Bank of Kenya unveiled new generation banknotes in order to curb the ramp of illicit financial flows that characterize money laundering, tax evasion, and corruption.