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January 2020 use of 'ECO' may not be achievable- Prof. Quartey

By Mutala Yakubu
January 2020 use of 'ECO' may not be achievable- Prof. Quartey
January 2020 use of 'ECO' may not be achievable- Prof. Quartey

Director of the Economics Division at the Institute of Statistical, Social and Economic Research (ISSER), Professor Peter Quartey believes that the date set for the use of common currency ECO by West African States is just tentative.

Professor Quartey believes the announcement by the Heads of State of ECOWAS on the adoption of a common currency, the ECO, is rather a declaration of intent than action.

He, therefore, wants leaders within the sub-region to work at meeting the key criteria.

"The Heads of States are basically encouraging members to strengthen their economies to make sure they get the processes right ahead of the 2020 deadline. But I do not think it is a definite situation that we are going into the use of a common currency system,” he argued.
Professor Peter Quartey meanwhile cautioned that the Anglophone and Francophone ties may impede the rolling out of the new currency for the sub-region.

“Whether France will easily severe its relationship with the Francophone countries is also something that we need to grapple with.

Professor Quartey

In time past, you would also realize that anytime that the Anglophone countries made a move, the Francophone countries will make counter moves. So it is a challenge that countries that intend to go to the use of the Eco will have to deal with,”

The West African leaders endorsed the currency at a meeting in Abuja in Nigeria and approved a road map towards the currency’s issuance in January 2020.

There had been an initial roadmap to ensure that all member countries meet three primary criteria for the adoption of the currency.

These included; a budget deficit of not more than three percent, average annual inflation of less than 10 percent with a long-term goal of not more than 5 percent by 2019.

Again, member states were expected to have gross reserves that can finance at least three months of imports.

The benefits of the Eco to member countries include; protection from exchange rate costs, improved investments across the sub-region, among others.

The ECOWAS Heads of state, however, maintain that the January 2020 timeline will not be reversed.

As a result, countries that have made progress will be made to start adopting the currency while others follow.