The new West African currency that was earmarked to replace the CFA franc will not launch this year due to the corona virus pandemic.
Ivorian President Alassane Quattara revealed the information in a press conference during a visit to the southern city of Bouafle. “We know the eco (proposed name of the new currency) cannot be put in place this year because of COVID-19.”
In December, eight countries that form the West African Monetary Zone – Mali, Ivory Coast, Niger, Senegal, Benin, Burkina Faso, Togo, and Guinea Bissau; announced in a historic decision that they would switch to a new currency and stop using the CFA franc. Analysts viewed it as part of a “financial decolonization effort” from France.
However, these moves have hit a setback, and as such, the currency can only be launched in five years. The World Bank predicted that Sub Saharan Africa’s economy will contract by 3.2% in 2020, its worst performance on record.
Most Africans view the new currency as a source of pride, and it was anticipated during talks on the eco held in Niamey early this month, that the currency launch would remain on track. All eight countries vowed to meet the agreed criteria including capping national budget deficits at or below 3% of gross domestic product.
However, that now seems impossible in the near future, with President Quattara adding, “We think it will be difficult to get to a 3% deficit for two or three years, so personally I don’t see the eco’s arrival for five years.”