Author Topic: West African countries to launch common currency  (Read 2035 times)

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Offline Pabitra

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Re: West African countries to launch common currency
« Reply #15 on: March 04, 2020, 04:40:08 AM »
I think the journalist appears to have taken journalistic liberties and reported it wrong due to his ignorance.

June 2019 selection of name is also linked to introduction of new currency target as June 2020.

Majority of the member countries have CFA as their currency and they will switchover to Eco. It appears to be renaming but perhaps, for ease of transactions and avoidance of any computations, they plan to have this changeover at the rate of 1:1. As on date, no Currecy notes or coins have been designed or printing/minting orders placed. Only the nomenclature will change but will help them getting their funds back from France. The banks start using the new name and general public will not be need to be educated.

Is it not the only, least time consuming and lowest cost  way to go ahead?

Since the English speaking countries have not been very unified or target oriented, they are now being forced to join the union as per their convenience and at their costs. Thus, they will have to give Euros or Dollar guarantees for the new currency, fix the conversions rates from Naira, Cedi etc to Eco, withdraw the old notes and coins and spend on printing and minting, educate the masses etc. This itself is a very big exercise, given the lack of infrastructure and education level of general public.

Since they are bigger economies, they thought that they will be able browbeat their smaller economy cousins. Fortunately, this turned out be not so. Now they are trying to wriggle out of their commitment and the misinformation campaign seems to have found journalists who can not read between the lines.

Offline Big_M

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Re: West African countries to launch common currency
« Reply #16 on: March 12, 2020, 04:42:00 PM »
What they are planning for the new currency is not good news. I am afraid it can only bring more instability to Africa.

Offline Pabitra

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Re: West African countries to launch common currency
« Reply #17 on: June 01, 2020, 03:45:19 AM »
Eco comes in to existence

French treasury to peg Eco to Euro at 1 EUR = 655.957 ECO

See

https://www.aa.com.tr/en/africa/8-francophone-countries-get-new-currency/1858754

Offline eurocoin

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Re: West African countries to launch common currency
« Reply #18 on: June 01, 2020, 09:39:33 AM »
My message here explains precisely what has now happened. These 8 countries have stolen the Eco name and have renamed the CFA Franc the Eco, which was not at all what was planned. Eco was going to be the name of the common currency of West Africa (so not only the 8 CFA Franc countries).

So now they have a currency called the Eco without meeting any of the convergence criteria that were established for the Eco (the common currency of West Africa). It will be interesting to see what happens next. Will the common currency for the entire West Africa now have to get a different name, or will the other West African countries also just introduce the Eco (former CFA Franc) and if so, will they too not have to meet any of the convergence criteria that were set for the common currency of West Africa?

Regardless, a potential disaster in the making.
« Last Edit: June 01, 2020, 10:59:17 AM by eurocoin »

Offline eurocoin

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Re: West African countries to launch common currency
« Reply #19 on: June 20, 2020, 10:19:39 AM »
Part of an interview with an influential Guinean economist and politician in Financial Afrik:

If you take the single currency project, the Eco, you know that in our zone you have two types of monetary regions, the CFA countries on the one hand which already have a single currency which is the CFA Franc and the countries to national currencies such as Guinea, Ghana, Nigeria, Sierra Leone, The Gambia etc… with a certain irony, I have often spoken about it, it is the countries of the WAMZ who initiated the Eco zone, but it is rather the CFA zone countries which are ahead in the process of creating the single currency because quite simply in the CFA zone, there is a certain discipline. You know that for the creation of a monetary zone, there is the tradition of budgetary, economic and monetary discipline which are called the convergence criteria which revolve essentially around the budget deficit, the external debt, the rates of interest and inflation. All the countries of the CFA zone are already in a good position compared to the countries of the WAMZ on the criteria of convergence, hence the hiatus that there has been recently between these two monetary zones in relation to the single currency. Covid-19 will further delay the process, but I believe the single Eco currency will emerge, since Africa will be hit hard by the economic crisis linked to the covid-19 pandemic and the need to regroup will still be much stronger than before. The decree of France confirming the creation of the Eco is a new step taken in the process of creating the single currency. As with the single currency, the project to materialize the African continental free trade area is on the right track.

Offline eurocoin

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Re: West African countries to launch common currency
« Reply #20 on: July 13, 2020, 07:12:01 PM »
Nigeria's leader uneasy over new West African currency

Nigeria's president expressed concern Tuesday over the decision of some West African nations to replace their currencies with the Eco ahead of the rest of the member countries of the Economic Community of West African States (ECOWAS).  President Muhammadu Buhari made the comments at an extraordinary virtual summit of the Authority of Heads of State and Government of the West African Economic and Monetary Union (UEMOA) hosted by the West African Monetary Institute, Accra Ghana.

''It gives me an uneasy feeling that the UEMOA Zone wishes to take up the Eco in replacement for its CFA Franc ahead of other ECOWAS Member States. It‘s a matter of concern that a people with whom we wish to go into a union are taking major steps without trusting us for discussion,'' Buhari said in a series of tweets.

The members of the UEMOA are Benin, Burkina Faso, Ivory Coast, Guinea-Bissau, Mali, Niger, Senegal and Togo. They have a single currency, the CFA Franc, which is pegged to the euro.

Buhari said Nigeria fully supports and is committed to the monetary union, ''but we must do things properly and ensure absolute compliance with the set standards.''

Last month, France's Council of Ministers officially passed a bill that ratified a reform of the monetary agreement that bound the French government to the eight UEMOA member states. The Eco will remain pegged to the euro and will be backed by the French Treasury. The euro will guarantee the Eco's convertibility and stability, with the Treasury remaining as guarantor for all eight UEMOA states.

''We must proceed with caution and comply with the agreed process of reaching our collective goal while treating each other with utmost respect. Without these, our ambitions for a strategic Monetary Union as an ECOWAS bloc could very well be in serious jeopardy,'' said the Nigerian head of state.''We cannot ridicule ourselves by entering a union to disintegrate, potentially no sooner than we enter into it. We need to be clear and unequivocal about our position regarding this process,'' he added.

According to the initial agreement, the UEMOA countries were to withdraw their currency reserves from the French central bank before adopting the new currency the Eco.

In the first phase, countries with their own currencies (Gambia, Ghana, Guinea, Nigeria and Sierra Leone) were to launch the Eco. In a second phase, the eight UEMOA member countries that have in common the CFA Franc will be covered by the Eco.

Source: Anadolu Agency

Offline eurocoin

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Re: West African countries to launch common currency
« Reply #21 on: September 14, 2020, 02:59:12 PM »
Last week there was a meeting of the leaders of the countries that are part of the ECOWAS. During the meeting the latest developments were discussed.

The countries that have renamed the CFA Franc the Eco reaffirmed their commitment to the ECOWAS Monetary Cooperation Programme and have claimed that the reform they have done (amongst other things the renaming of their currency) forms part of measures to be taken to convert the CFAF, as well as other currencies, into ECO, in accordance with the revised ECOWAS roadmap.

So now there are 2 currencies called Eco. The Eco that was once called CFA Franc and is now in use in the countries that used the CFA Franc and a new currency also called Eco that is yet to be established and that will in the future be a common currency of (almost) all countries in West Africa, including the former CFA Franc countries.

The leaders have come to the conclusion that it is not possible to introduce the Eco on January 1, 2021. They have postponed the launch of this new currency. A new roadmap has yet to be made.
« Last Edit: September 14, 2020, 03:30:29 PM by eurocoin »