James Emejo in Abuja
Some analysts have thrown their weight behind the federal government’s response to the hasty adoption of the ‘Eco,’ the proposed single currency for West African countries.
THISDAY had reported in its lead story in yesterday’s edition that the federal government had adopted a cautious approach since it received the change of name of the West African Economic and Monetary Union (UEMOA) currency, otherwise known as Communaute Financiers d’Afique (CFA), to ‘Eco’ by eight French-speaking West African countries.
“Nigeria is studying the situation and would respond in due course,” a one-paragraph statement issued by Yunusa Abdullahi, on behalf of the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, had said.
Reacting to the federal government’s position, the President of the National Association of Nigerian Traders (NANTS), Mr. Ken Ukaoha, hailed the federal government’s response to the ‘Eco’ adoption by francophone West African countries, adding that Nigeria has often showed nonchalant attitude to similar situations in the past.
Ukaoha told THISDAY that the cost, including that of the monetary policy and economic adjustments of adopting the new currency, must be fully understood and well counted “so we do not become Germany to shoulder any dwindling member state. France would of course have been laughing by the side.”
According to him, some questions are still awaiting clear answers, decisions and adoption concerning the currency convergence.
“I attended the last ECOWAS monetary policy meeting held in Guinea Conakry during the second week of December. These fundamentals were placed on the table and many of these by the Nigerian representatives who were very sharp at that meeting.
“Matters arising as concerns now should include, why President Quatarra is speedily making the announcement before the Authority of ECOWAS Heads of State final decision, which usually comes with a legal framework?
“Is Quatarra the current chair of ECOWAS? Why even the duo of President Quatarra and Macron making the announcement? Where now are the decisions on the matters raised in Conakry? Indeed, there are more questions and concerns that may not be printed here on a social media.
“These are the reasons why I fell in love with Nigeria’s approach via the press release. Of course, Ghana as usual and as expected has concurred so that at the end, Nigeria would become the usual brunt bearer,” he stated.
Executive Director, Africa Industrialisation Group, Mr. Carl Oshodi, also told THISDAY that the “scepticism of the Minister of Finance should not be seen as a fundamental threat to the takeoff of the implementation phase of the ECO, but as a solution to some of the statements in the address of the President of the ECOWAS Commission, Jean-Claude Kasi who opined that member countries have made significant progress in several areas to achieve the monetary convergence, but that, which he argues requires efforts at strengthening constant reforms and currency review of ECOWAS member countries”.
He, however, stressed the need to attach great importance to trade liberalisation, adding that countries must be able to respect global trade commitments.
He said one of the imperatives of the ECO was to address issues such as borderlessness, especially the Nigerian border closure’s situation and the import of the causative factors, which have continued to serve as barriers to the full implementation of the ECO in order to be able to address regional trade barriers within ECOWAS, “especially on providing resultant sanctions to address the flagrant abuse of trade treaties.”
“The recent adoption of ECO since its proposal has led to so many considerations. For a fact, Nigeria and the controversies on the convergence criteria for the ECO to be implemented is a 10 convergence criteria, set out by the West African Monetary Institute (WAMI).
“In June and December 2019, presidents of the 15-nation ECOWAS agreed, with major decision effected at the summit in Abuja in June this year where they adopted ECO as the name of the planned shared currency for the bloc which will take off in 2020.
“This portends doubts on the possibility of the single currency regime to take proper effect until these conditions are met and when the conduciveness for its operationalisation trajects without foreign hindrances, particularly with the news of change of name of the UEMOA Currency, the CFA (Communaute Financiere d’Afrique) to Eco, supposedly as the single currency of Economic Community of West African States (ECOWAS),” he added.
However, President of CoralReef Consult, Mr. Ahmed Yusuf, said he believed there was no controversy in the issue as ECOWAS member countries had already agreed to adopt ECO.
He stated that for any block to be economically competitive, it had become necessary to be more united, adding that currency represented the best way to unite.
He said: “Once you have a common currency, you have a common trade because you have to have a common trade policy for implementation of the currency. So there is no controversy as far as I am concerned.”
He, however, said politics could take centre stage in the scenario “because at the end of the day, no matter what they do, the total economy of all of them will not amount to that of Nigeria.
“The critical issue is how can Nigeria take advantage of its position in this setting, period. The closure of the border is a first step.”