6 April 2014

West Africa: Ecowas Single Currency Set for 2020

The tortuous ECOWAS monetary cooperation adopted in 1987 could see light at the end of the tunnel in 2020 with the establishment of a single common currency in the sub region, according to the chairman of the ECOWAS Commission, Dr. Kadré Désiré Ouedraogo.

Implementation of this adopted monetary cooperation has experienced obstacles and challenges, thus prompting change in repeated strategies, the last of which occurred in 2009 focusing on two monetary zones for the project.

The first zone comprises the eight UEMOA member countries, while the second consists of the other seven member countries, including Liberia, that have each its own currency which by 2015 will be grouped in one currency area called WAMZ or West African Monetary Zone.

Ouedraogo told journalists on the sidelines of the 44th ordinary ECOMAS summit in Yamoussoukro, Cote d'Ivoire, that by 2020, the two areas are expected to merge to create a single currency area and establish a single common currency envisaged in 1987 by West African leaders.

"But as you know, monetary issues are very sensitive because they deal with both political and economic aspects. We must therefore proceed with caution bearing in mind that currency can only be backed with vibrant economy," he explained.

Therefore, Ouedraogo emphasized that establishing a common currency requires successful harmonization of budgetary, economic and monetary policy of each state. It also requires establishment of convergence.

"This convergence exercise has continued throughout the years and we found that there were delays mainly from the countries of the second monetary zone, WAMZ," of which ECOWAS leaders have been informed.

Nevertheless, imbued with a strong political will to achieve this goal, ECOWAS leaders entrusted the President of Niger, Mahamadou Issoufou and Ghanaian President John Dramani Mahama, incidentally current ECOWAS chair, to ensure oversight and the roadmap that will enable the sub region to achieve the desired objective: establishing a single currency zone by 2020.

Ouedraogo: "I am confident we can achieve our goal. It is simply a matter of political will and resources. As far as I am concerned, I have no doubt that this is feasible and achievable. We can reach a harmonious convergence provided that each of us takes the appropriate action. I am fully convinced that the Conference of Heads of State and Government will take appropriate steps to enable ECOWAS to achieve this crucial goal."

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