Nigerian recession defers ECOWAS single currency to 2020 – Experts

The much expected adoption of a single currency by ECOWAS countries will not be feasible till 2020, when the economic woes facing Nigeria may have receded, according to experts.

However, the programme was said to have been temporarily suspended following an ECOWAS committee report on Friday, which hinged its conclusion on what it described as intractable economic woes facing member-counties of the region, with particular reference to Nigeria.

Specifically mentioned as a major factor affecting the actualisation of the dream is the current economic recession, which has seen its currency, the naira lose more than 60 per cent of its value to major currency in the past one year.

“Nigeria as the main economic hub of the sub-region must lead the way of recovery from its recession, failure of which much progress would not be made in the single currency issue,” said spokesman of the regional group.

The special committee set up by ECOWAS to review the steps so far made towards actualising the programme, returned a verdict of shifting the take off date, originally planned for January 2017 to 2018.

Read also:  Hope for naira as economy receives $1.5bn diaspora boost

But experts said there is nothing on the ground to show that the exercise could be feasible earlier than 2020.

A financial expert, Matthias Okwe, said apart from Nigeria’s economic woes, no ECOWAS country can boast of boosting its economic base as to sustain the exchange rate value for substance of a single currency market.

“Single currency will entail participating countries having diverse export commodities that can attract foreign investment, thereby generating foreign exchange to shore up the strength of the common currency that is being proposed.

“The example can be derived from Euro currency, which is today stronger than most currencies of member countries of the European Union, simply because the economies of the 28-member countries are strong, but in ECOWAS , only Nigeria and perhaps Ghana can boast of manageable economies”, he posited.

Other analysts say security question in most counters in the region is capable of undermining free movements and trade transactions among member-countries.

They specifically mentioned the Boko Haram insurgence and other security challenges along the Sahel enclave of Africa as a militating factor that could frustrate sustaining a single currency economy.

But news report quoted the ECOWAS Commissioner, Macro economic Policy and Economic Research, Mamadou Traore, as admitting that the Community will continue to promote policies that will encourage moves aimed at achieving the single currency economy.

RipplesNigeria ….without borders, without fears

Join the conversation

Opinions

Support Ripples Nigeria, hold up solutions journalism

Balanced, fearless journalism driven by data comes at huge financial costs.

As a media platform, we hold leadership accountable and will not trade the right to press freedom and free speech for a piece of cake.

If you like what we do, and are ready to uphold solutions journalism, kindly donate to the Ripples Nigeria cause.

Your support would help to ensure that citizens and institutions continue to have free access to credible and reliable information for societal development.

Donate Now