Ghana not prepared to sign onto ECO – BoG

Bank of Ghana (BoG) has indicated that Ghana is not prepared to adopt the ECOWAS single currency, ECO, anytime soon, ABC News can report.

The Central Bank admitted that Ghana, like many other Anglophone countries, is finding a tough time meeting the threshold established to make it eligible to sign onto the currency.

The ECO is a common currency proposed to be used by ECOWAS member states to break trade barriers and boost integration.

Already eight Francophone countries have signed onto the currency. They are Benin, Burkina Faso, Guinea Bissau, Ivory Coast, Mali, Niger, Senegal and Togo.

Despite the unpreparedness, the government of Ghana has committed to make the ECO a legal tender, as soon as possible.

Speaking in an interview, the Head of Currency Management, BoG, John Gyamfi noted that the eight francophone countries have been able to achieve the feat because they have a common central bank and currency, making things quite easier for them.

“The Francophones have stuck together, they have a single central bank issuing CFA. So the CFA has been supported by French France, now Europe and so they have a fixed exchange rate arrangement. Unfortunately, the Anglophone countries are on our own separate… and then before we can even come together to do what the French people have done, there are certain criteria to meet,” he said.

The criteria, he said, included having low and stable inflation of five percent or less which appears to be a hard nut to crack for many Anglophone countries.

“As I speak I don’t know of any of the Anglophone countries that have met this criterion.

“You have to make sure you have gross international reserves at all times that will meet at least three months of import, financing to GDP is four percent or below. These we call the principal criteria for adopting the ECO,” he noted.

“We have to meet it and sustain it but the evidence on the grounds is that the Anglophones, one will meet it this year, next year he has flopped, another will meet it, somebody meets three instead of four and things like that,” John Gyamfi conceded.

Source: ABCNewsgh.com