The eco at a crossroads: West Africa's single currency dream meets monetary reality

Few projects in African economic policy have been announced as often, and arrived as rarely, as the eco — the planned single currency of the Economic Community of West African States, most recently targeted for 2027 under the roadmap adopted in 2021. The economics suggest the timeline matters less than the architecture.

The convergence problem is stark. A currency union requires members to live with one monetary policy. The region spans low single-digit inflation in the CFA franc zone, anchored by the euro peg, and much higher inflation histories in the largest anglophone economies. One policy rate cannot fit both without imposing real costs on someone — and the someone, monetary history suggests, is usually the smaller economies.

The CFA franc question is the political heart of the matter. The WAEMU members already share a currency, a central bank and — critically — a French-backed convertibility guarantee. Folding into an eco anchored by economies with recent double-digit inflation means trading a hard peg for a managed float. For Abidjan and Dakar, the credibility mathematics are unforgiving.

An alternative sequencing has gained ground in regional policy discussion: build payment integration first — instant cross-border settlement in existing currencies through systems like PAPSS — harmonise bank supervision, and let currency union arrive as the final step of a fait accompli rather than the first step of a declaration.

The eco may yet arrive. But the lesson of monetary unions everywhere is that the currency is the trophy, not the tool: the integration that matters happens in payment systems, trade flows and fiscal rules long before the banknotes change.