President Akufo-Addo (right) in a handshake with President Alassane Ouattara of Cote d’Ivoire
EIGHT WEST African countries have announced their decision to discontinue the use of the CFA franc in favour of the proposed new currency of ECOWAS, the ECO, beginning this year.
The declaration was made by the President of the West African Economic and Monetary Union (UEMOA), Alassane Ouattara, who is also President of La Cote d’Ivoire, after French President Nicholas Macron visited the country on December 21, 2019.
The eight countries include Benin, Burkina Faso, Cote d’Ivoire, Mali, Niger, Senegal, Togo and Guinea Bissau, which is not a French colony.
Mr. Macron made the announcement and disclosed that France had decided to allow for a monetary facelift on the currency of UEMOA, describing colonialism as ‘a profound mistake’.
Ghana’s endorsement
A statement from the Communications Directorate of Jubilee House, signed by Eugene Arhin, which hailed the move, noted, “This is a welcome decision which Ghana warmly applauds. It is good testimony to the importance that is being attached not only to the establishment of a monetary union, but also to the larger agenda of West African integration.”
It continued, “We, in Ghana, are determined to do whatever we can to enable us join the member states of UEMOA soon, in the use of the ECO, as we believe it will help remove trade and monetary barriers, reduce transaction costs, boost economic activity and raise the living standards of our people.”
Appeal
“Ghana urges the other member states of ECOWAS to work rapidly towards implementing the decisions of the authorities of ECOWAS, including adopting a flexible exchange rate regime, instituting a federal system for the ECOWAS Central Bank, and other related agreed convergence criteria, to ensure that we achieve the single currency objectives of ECOWAS, as soon as possible, for all member states.”
Furthermore, it stated, “We have a historic opportunity to create a new reality for the peoples of ECOWAS, a reality of general prosperity and progress. So let us seize it.”
Petitions to France
There have been several appeals to France, which colonized the seven countries, to release its hold on the currency union and pave the way for improved relations with its former colonies.
Albeit details of the decision are yet to be firmed up, the eight countries will now not be required by France to keep half of their reserves at its treasury, while also there will not be a French representative on the currency union’s board.
Mr Ouattara has hailed the development as historic.
The CFA franc, which has since 1999 been pegged to the euro, was introduced in 1945, and has been used in two African monetary zones, including the eight West African countries and some other six mostly petro-states in central Africa.
Nigeria’s take
Meanwhile, Nigeria has noted that it has received the news of the change of name of the UEMOA currency – Communaute Financiere d’Afrique – to ECO, supposedly as the ECOWAS single currency.
“Nigeria is studying the situation and would respond in due course,” a press release from the Federal Ministry of Finance, Budget and National Planning singed by Yunusa Tanko Abdullahi, special advisor, Media and Communication to the minister, stated.