Therefore, this would complicate regional trade within the ECOWAS region,” Larbi added. “Some countries believe their currency is stronger than the other. “There’s need to promote the currency and educate the indigenes of individual countries for it to work,” Larbi told DW. Afo Larbi, an economist and financial analyst told DW that for the Eco currency to be successfully launched, there must be a unanimous agreement between anglophone and francophone countries in the region. The CFA franc is used in 14 African countries, split into the West African CFA and the Central African CFA, and used by about 150 million. History has it that there haven’t been synergies between French and English-speaking countries in West Africa to work together on various regional trade and investments issues.įrancophone countries within the ECOWAS region, particularly those that use the CFA franc, have their own perceptions of how the Eco currency would work. Anglophone versus Francophone econometricsĮven if these hurdles are overcome, political problems will probably still prevent the currency from taking off. John Garchi Gatsi, a chartered economist and professor at the University of Cape Coast Ghana, told DW that one of the reasons the Eco currency failed to kick-off is that it was modeled like Europe’s euro, where leaders came up with a set of benchmarks and criteria that all ECOWAS member states should adopt before the launch. Another criterion that these countries have been unable to meet is the debt-to-Gross Domestic Product (GDP) ratio. The criteria included curbing inflation, budget deficits, and their financing, reserves, and exchange rate stability. However, the COVID pandemic and the failure of many countries to meet the criteria for launching the single currency precipitated the postponement to 2027.
Since its conception in 2003, leaders of the fifteen-member Economic Community of West African States (ECOWAS) have postponed the launch of a single currency at least four times: In 2005, 2014, 2014, and 2020.ĮCOWAS leaders had set a goal of achieving a monetary and currency union by late 2020.