As the European Union risks falling apart in the wake of Brexit, regional integration in Africa—once modeled after the EU—is making progress. At the African Union (AU) summit later this month, the AU will introduce a single passport to make travel to all 54 member countries of the union possible. The AU passport is part of an eventual goal of creating a “continent with seamless borders.”
Establishing a single common currency for the AU, while still far off, may not be all that unrealistic. Regional blocs are already moving closer to using a common currency. This week, former Nigerian president Olusegun Obasanjo called on the Economic Community of West African States, better known as ECOWAS, to introduce the “eco” a single currency for West Africa. ECOWAS officials have previously committed to introducing a single currency for the region by 2020.
“We have decided that our unit of currency will be ‘eco.’ Let us now start using eco. Let eco become our unit of currency,” Obasanjo said at a meeting of the ECOWAS commission on July 4.
Advocates of a common currencies like the eco say that it would reduce exchange rate uncertainties, attract more foreign investment, and help regional economic integration. Other regional blocs have already moved in this direction. The CFA franc zone, of mostly former French colonies, uses the euro-pegged franc. East African states Kenya, Uganda, Rwanda, and Tanzania agreed on a protocol for establishing a common currency among them within the next decade.
And in southern Africa, the Southern African Development Community is working toward establishing a single currency by 2018. For now, it is piloting a cross-border payment system in countries that already use the rand, South Africa, Lesotho, Swaziland, and Namibia.
A single currency for all of Africa is still far off. In the early 1990s, establishing a monetary union was laid out as a goal to be achieved by around 2020. It has since been put on the back burner with the African Union deciding not to include it as part of its 2063 agenda for integration. Instead, the AU passport would be the first main step.
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