The currency struggle: will ECOWAS adopt a single currency?

Editor's note: Talk Africa is a weekly talk show that brings together guests from across Africa and beyond to discuss pressing African issues and global topics, amplifying the continent's voice and showcasing diverse perspectives and independent thinking. This episode explores ECOWAS' long-standing pursuit of a single regional currency to replace the CFA franc and other national currencies across the bloc.

West Africa's pursuit of economic integration stands at a historic crossroads as the Economic Community of West African States (ECOWAS) reaffirmed its target to launch the Eco single currency by 2027.

This monetary shift offers an unprecedented opportunity to eliminate trade barriers and spark unified economic growth.

However, the path remains controversial, with stiff macroeconomic hurdles, member state opt-outs, and lingering sovereignty disputes surrounding the French-backed CFA franc threatening the timeline.

A History of Broken Promises

This regional ambition is heavily burdened by a history of false starts.

First conceptualized decades ago, the Eco's implementation has been systematically derailed and postponed at least five times, with prominent missed deadlines in 2003, 2005, 2010, 2015, and 2020.

The recurring delays stem from member states' persistent failure to meet strict macroeconomic convergence criteria, compounded by global shocks such as the COVID-19 pandemic.

This continuous cycle of procrastination has fueled widespread skepticism about whether the new timeline is a realistic fiscal target or simply another administrative mirage.

"Achieving full consensus before launching the Eco is practically impossible because every country within the region operates under entirely different geopolitical interests," Dr. Pippie Hugues, Policy Analyst at the Governance and Democracy Division of the Nkafu Policy Institute, told CGTN.

However, he remains hopeful that 2027 could be the “magic year,” given the phased approach that allows countries to join once they meet the agreed economic conditions.

Regional geopolitics & economic realities

This ideological divide highlights a fundamental disagreement over how to launch the currency.

Dr. Daniel Amateye Anim, Chief Economist at the Policy Initiatives for Economic Development, acknowledges that meeting strict targets—including single-digit inflation, a 3% fiscal deficit-to-GDP ratio, and long-term debt sustainability, has historically been a challenge.

However, he argues that waiting for every single nation to achieve a perfectly stable, uniform macroeconomic environment will permanently stall the currency's progress, meaning the region must move forward despite these economic imbalances.

This creates a sharp contrast with the geopolitical roadblock raised by Dr.Ndongo Samba Sylla, Africa Regional Director of the International Development Economics Associates.

Dr. Sylla maintains that fragmented political realities and competing national interests make regional consensus on a common currency virtually impossible.

“There is no interest for countries to share the same currency,” Dr. Sylla says, noting that Nigeria accounts for more than two-thirds of the region's GDP. “Even if it were feasible, it would just be a new name for the Nigerian currency.”

Lessons from the Eurozone

Drawing lessons from the Eurozone, Dr. Sylla warns that launching a single currency without a unified political federation or central fiscal authority would be a historical mistake. This raises a crucial question about the region's existing monetary infrastructure.

Dr. Anim advocates for continental "trial and error," urging African nations to learn by intensifying and infusing the Pan-African Payment and Settlement System (PAPSS) directly into the Eco's economic model to build momentum.

Conversely, Dr. Sylla views this payment alternative not as a stepping stone, but as a total replacement for a doomed monetary project. He points out that crucial foundation work—such as central bank statutes, localized payment infrastructure, and physical banknotes—remains entirely non-existent for a 2027 rollout.

Doubling down on his Eurozone warning, Dr. Sylla maintains that without a unified West African political foundation to manage joint spending, a regional currency is logically dead on arrival.

Breaking Neocolonial Ties

Despite these steep structural arguments, the drive for monetary sovereignty remains a powerful motivator.

Among the 12 member states of ECOWAS after the withdrawal of Mali, Niger and Burkina Faso, five of them still use French-backed CFA Franc, which is pegged to Euro.

“I think this is the time for us to get out of this French neocolonial method and try to see how we can adopt an African perspective." says Dr.Hugues.

To support this sovereignty, Dr. Anim emphasizes that the region must establish a functional central bank backed by robust foreign reserves to meet citizen demand, while simultaneously shifting away from import-driven vulnerabilities by prioritizing local manufacturing, value addition, and intra-African trade.

Unification or Cooperation?

Instead of forcing a flawed monetary union that has triggered constant postponements since 1983, Dr. Sylla proposes shifting toward regional monetary cooperation—specifically utilizing common payment and settlement systems to clear cross-border trade without relying on the US dollar.

Ultimately, the future of West African integration may hinge on redefining the goal itself. While proponents see the 2027 Eco launch as a vital step toward breaking colonial shackles and forcing economic discipline, critics argue the region must stop chasing the illusion of monetary unification.