By Mohammed Momoh
Nigeria and some other West African countries have agreed on an enlarged meeting to discuss the regional single currency issue which had been put in “serious jeopardy’’ by francophone nations in the Economic Community of West African States (ECOWAS).
President Muhammadu Buhari of Nigeria on June 23, 2020 expressed deep concern on the decision of francophone countries that form the West African Economic and Monetary Union (UEMOA) to replace the CFA Franc with the single currency, Eco, ahead of the rest of Member States.
Buhari delivered Nigeria’s position on the new regional currency at a virtual extraordinary meeting of the Authority of Heads of State and Government of the West African Monetary Zone (WAMZ) on June 23.
Buhari said: “It gives me an uneasy feeling that the UEMOA Zone now wishes to take up the Eco in replacement for its CFA Franc ahead of the rest of the Member States.’’
‘‘This is in addition to deviating from the Community Act on a consistent attainment of convergence in the three years running up to the introduction of the currency, and our subsequent reinforcing directives.
‘‘It is a matter of concern that a people with whom we wish to go into a union are taking these major steps without trusting us for discussion.’’
‘‘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. We must also communicate same to the outside world effectively. We have all staked so much in this project to leave things to mere expediencies and convenience.
‘‘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,’’ he said.
The meeting discussed the implementation of the ECOWAS Monetary Cooperation Programme (EMCP) and the ECOWAS Single Currency Agenda.
The President reminded his colleagues of the history of the Eco and the remarkable progress, including the adoption of the Exchange Rate regime, the name and model of the common Central Bank and the symbol.
Expressing disgust with the francophone action, he said: ‘‘I am informed that the French Ministers have approved a bill to reform the CFA Franc and most, if not all of the UEMOA Member States, have already passed legislations in their various Parliaments to that effect.’’
He urged other countries to critically consider the recommendations made by the Convergence Council and take a common position to safeguard the West African Monetary Zone from the “pitfalls of a questionable union’’.
He affirmed Nigeria’s support for a monetary union with the right fundamentals, which guarantees credibility, sustainability and overall regional prosperity and sovereignty.
Nigeria, he said, believes that given the potential contractions and even losses from the global Covid-19 pandemic, member states cannot but be too cautious about ensuring compliance with the set standards.
‘‘My dear colleagues, Heads of State and Government, It is obvious that we are at a crossroads.’’
The rage was caused by the decision of French speaking West African countries to renounce their French Franc (CFA) and unilaterally converted their currency to ECO, the ECOWAS single currency which had been in the mill for decades.
Benin, Burkina Faso, Guinea-Bissau, Ivory Coast, Mali, Niger, Senegal, and Togo reverted to ‘Eco’ at a ceremony in December 2019 attended by French Leader, taking the rest members of the bloc by surprise.
The decision to call the CFA franc replacement currency the ‘Eco’ caused a major rift in the region – and pit the Francophone nations against their English speaking counterparts.
Pundits see the action of the eight countries as whitewash – despite the new name, it will still be pegged to the euro and still be backed by the Banque de France, leaving it open to old criticisms.