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The Imperative for a West African Common Currency in the Light of the Euro Zone Experience

Abstract


The old practice of the individual survival of nations has long given way to the emergent concept of economic, monetary integration and cooperation among states with contiguous and regional compatibility as an option to meeting the collective developmental needs of their people. Practice has shown over time that when states take comparative advantage of each other’s strength and weaknesses, it opens the space for trade and engenders the potentials for product specialization, development of the economies of scale and indeed reduces the cost of production, and consequently, enhances the purchasing power of the citizenry. In recent times, there have been significant increases in the efforts of developing countries especially in Sub-Saharan Africa to achieve regional economic integration. The launch of the African Union (AU), the New Partnership for Africa’s Development (NEPAD), as well as the Economic Community of West African States (ECOWAS) have given new impetus to the global African and regional integration processes and have focused particular attention on the need to take decisive action to tackle the continent’s numerous problems through the instrument of the economic integration strategy. This strategy was targeted at ultimately dovetailing into the adoption of a common currency for the sub-region through a two-pronged strategy of the preliminary introduction of the Eco, which would ultimately integrate with the CFA Franc to form the West African common currency. The takeoff of this dream has suffered numerous setbacks and postponements without firm commitments and prospects for its realization. This paper analyses the rationale and prospects for economic integration in West Africa as well as evaluate the challenges and debilitating factors militating against the realization of the common currency in the light of the Eurozone experience.


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