( 3 minutes read)
· The West African ECO current Symposium kicked off on May 26 in Togo, amidst a lot of uncertainties surrounding launch of ECO. The focus of the symposium is ECO. Keeping that in mind, the first part of the inaugural day was devoted to the debate on the challenges of monetary integration in West Africa
· For monetary integration, there are various conditions to be abided by the member countries. Economists maintain that in a zone that includes heterogeneous economies complying with conditions like fiscal deficit, inflation etc would be difficult and the issue is bound to divide the contracting parties
· Withdrawal of the old currencies, decision on exchange rate, and other regulatory issues would be difficult especially when the economies are in doldrums due to disruptions caused by the Covid-19 pandemic.
The West African ECO current Symposium kicked off on May 26 in Togo, amidst a lot of uncertainties surrounding the launch of ECO. The focus of the symposium is ECO. Keeping that in mind, the first part of the inaugural day was devoted to the debate on the challenges of monetary integration in West Africa.
Reports coming from the meeting venue – Etats Généraux de l’Eco – indicate that differing views were expressed during the discussions; those who are in favor and against. Economists seem to be against the new currency, at least in the immediate future, since they feel that it would lead to hyperinflation and multiple exchange rates. For monetary integration, there are various conditions to be abided by the member countries. Economists maintain that in a zone that includes heterogeneous economies complying with conditions like fiscal deficit, inflation etc would be difficult and the issue is bound to divide the contracting parties. Also, they feel that the implementation of a new currency is not a simple process. Withdrawal of the old currencies, decision on exchange rate, and other regulatory issues would be difficult especially when the economies are in doldrums due to disruptions caused by the Covid-19 pandemic.
Issues relating to counterfeit notes, time to be given for transition, creation of a monetary authority, which should have teeth etc are other challenges that are being faced before the launch of ECO. The general feeling among economists, policy makers and businessmen seems that more discussions, research and informed dialogue should take place among stakeholders before switching over to the new currency, although nobody questions about the imperativeness of the switch over.
