ECOWAS Central Banks meet over introduction of ECO this year

ECOWAS Central Banks meet over introduction of ECO this year
Source: JoyBusiness
Date: 14-01-2020 Time: 01:01:08:pm

Central Banks in the ECOWAS region would Tuesday, January 14, 2020, begin an Extra-Ordinary meeting to discuss issues relating to the possible introduction of the single currency, the ECO.

JoyBusiness understands that the committee of Central Bank governors is expected to discuss the implications of the recent announcement by the French-speaking countries in ECOWAS on the proposed introduction of the single currency the ECO to replace the CFA franc. 

The Central Bank governors would also discuss and determine the way forward for the member states of the West African Monetary Zone (WAMZ) in line with the road map for the introduction of the single currency - The ECO. 

The meeting would be preceded by the Technical Committee meeting comprising of directors of research or Monetary Policy Department of the Central Banks in the West African region.  

The Technical Team would also present proposals made by the West African Monetary Institute about the ECO. 

The Central Bank governors are expected to forward their recommendations to the Heads of States in the region as to whether the region is ready for the introduction of the single currency.

Who is attending this meeting?

Based on information picked by JoyBusiness the gathering is brining Central Bank governors various monetary and research directors in the West African Monetary Zone.  

Concerns about the ECO’s introduction

Some economists and trade analysts are still sceptical about the possible introduction of the single currency, the ECO this year. 

This is because conditions required, before the currency is introduced are yet to be achieved. 

Some of these economists cite the establishment of the West African Central Bank, which is yet to be in place despite a proposal by Heads of State for the ECO to be introduced from this year. 

The region is still yet to determine the country to host the headquarters, that is, should it be Accra, Ghana or Abuja, Nigeria. 

There are also questions about how the economic grouping should deal with the convergence criteria for the adoption of the ECO. 

This is because the biggest economies in the region, which is Ghana and Nigeria are still struggling to meet all the benchmark for the introduction of the single currency. There are also questions about which economy would or should able allowed to use their reserves to support the planned introduction of the ECO.   


The ECO’S “blues”

The economic grouping, ECOWAS has struggled since 2000 to introduce the currency. One of the main reasons for this challenge has to do with the inability of the majority of its members in the West African Monetary Zone. The introduction of the ECO has been postponed by more than five times. 

This is why some still doubt ECOWAS’ commitment to go ahead and introduce the currency this time around.