Ivorian President Alassane Ouattara has confirmed that the West African single currency will not be created in the coming months. While reaffirming its will to work for the creation of the eco, despite the differences between states.
“We know that the eco cannot be implemented this year,” said Ivorian President Alassane Ouattara. He spoke of the reasons: “Of course because of Covid-19, as well as the difficulties that different states have.”
The President confided in his sentiment: “Personally, I don’t see the eco coming for three to five years. But, I wish it would come as soon as possible.”
He was responding to journalists’ questions after a four-day visit to the Marahoué region. He observed that “the eco will therefore be in place by this time”, however saying that he is “totally in tune” with his counterparts at ECOWAS on what should be done.
Alassane Ouattara specified that during the last conference of heads of state of the organization in Niamey, on September 7, “we saw that we had total convergence, that everyone must continue to make all the necessary progress to achieve fulfillment of the criteria and that it may take three, four or five years”.
“Eco as scriptural or fiat money will not be able to emerge for a period of three to five years. During this period, we will continue to use the CFA franc, which is a good currency,” Alassane Ouattara had already suggested on this occasion.
He implied that between now and this period, it will not be possible to establish a transition period where the value of the new currency, its parities with the main currencies such as the dollar or the euro, would be fixed, without the banknotes not being fixed. are printed.
Before the arrival of the eco, the member states of WAEMU (West African Economic and Monetary Union) should make the necessary efforts to “erase the links with the French treasury and the presence of the French in the structures of the ‘Union'”.
Will economy see the light of day? Yes, believes Yao Prao, professor of economics at the University of Bouaké, in Côte d’Ivoire. “It’s a question of political will. Five years is enough to get there,” he believes, despite the “discrepancies” between the countries. The economist alludes to reservations expressed by Nigeria, which accounts for 60% of the area’s GDP.
Nigeria demands, in order to engage in a monetary union, that the countries of the CFA zone fully sever their ties with France, thus going beyond the envisaged reform. Conversely, other countries fear, above all, the monetary instability that could represent a currency free of any fixed parity.
“It is a good thing for West African countries to have a single currency, however we need to have a debate on the convergence criteria (inflation, debt, public deficit): do not try to mimic Europe; the establishment of a single currency must not lead to a policy of austerity to the detriment of growth and jobs,” Yao Prao said in an interview with AFP.
The economic crisis generated by the coronavirus epidemic, with a fall in growth in West Africa, has made it illusory to meet these convergence criteria in the near future. For former Ivorian minister Daniel Anikpo, the eco “is not going to happen” for lack of political will.
“When I was minister in 2000, there was already talk of a five-year deadline”, testifies the economist, supporter of a common West African sovereign currency. “We cannot wait for a thousand years for each other’s incompatibilities to be resolved!”
For his part, Patrice Talon recognizes errors of method: “For the sake of going quickly, but also for the desire to display, we made a communication error by affirming in Abidjan last December that the eco was going to be born on the ashes of the CFA franc. This shocked our non-Uemoa partners.”
The President of Benin wants “to be clear” on this subject, he confides to Jeune Afrique magazine: “The eco will not proceed from the change of the CFA franc used by the countries of the Uemoa zone, which would be joined by the Nigeria, Ghana, Guinea etc.” Is another method possible?
Reference: https://newsaf.cgtn.com/news/2020-09-29/New-West-Africa-currency-delayed-for-five-years–UaeCg5KpYQ/index.html
