The AES emerges amid a broader geopolitical repositioning: the three member states voiced their disagreement with certain ECOWAS policies, particularly regarding sanction mechanisms and what they consider excessive pressure. They thus chose to withdraw from the West African regional bloc and establish an autonomous alliance rooted in sovereignty, inter-state solidarity, and the construction of an alternative economic space.
But the recent creation of the Confederal Bank for Investment and Development (BCID-AE) marks a significant turning point. With an initial capital of 500 billion CFA francs, the bank aims to finance critical infrastructure and support local industrialization. “This project is not just a financial move, it’s a political act of sovereignty,” says international economist Magaye Gaye. “It reflects the Sahel states’ desire to finance their own development.”
In the face of persistent regional instability, recurring security crises, and growing distrust of traditional regional institutions, Mali, Burkina Faso, and Niger formed the Alliance of Sahel States (AES) in September 2023. This initiative stems from the three Sahelian countries’ desire to build a strengthened cooperation framework focused on their shared strategic interests, initially in defense and security, and now increasingly in economics.
Since their withdrawal in January 2024, the Alliance has taken concrete steps to accelerate integration. These include the elimination of mobile roaming fees between the three countries, the development of a joint passport, and, on the trade front, the implementation of a unified 0.5% customs duty on imports from non-member countries. These measures reflect a shared ambition to build a solid regional economic foundation.
To succeed, however, the AES must overcome several challenges: securing the pledged capital, attracting strategic partners such as China, the BRICS, or African sovereign wealth funds, and establishing credible governance.
“A clear strategic vision, strong expertise, and well-targeted partnerships are essential,” Gaye emphasizes.
Redefining Relations with International Donors
This momentum could also reshape relations with international financial institutions.
“These banks must revise their priorities and conditions when dealing with AES countries,” Gaye argues. “These states aren’t seeking isolation but rather diversification of their support and a strengthening of their endogenous resources.”
A Common Currency on the Horizon?
Another initiative under consideration is the creation of a common currency.
“It’s possible,” says Gaye. “These three countries alone represent 75% of the WAEMU’s landmass and 50% of its population, a significant critical mass.”
But he cautions: simply exiting the CFA franc will not be enough. Past mistakes must be avoided, particularly the excessive focus on inflation control at the expense of growth and employment.
“Economic policy foundations must be redefined: harmonizing taxation and budgets, and correcting chronically negative trade balances,” he concludes.
The Alliance of Sahel States is forging its own path not through isolation, but through accelerated economic integration and greater control over its development levers. The success of this strategy could redefine the regional economic balance, provided that ambitions are matched by means.
The History of the ECOWAS currency (ECO) and its failed journey since 2000
The ECO is the name for the proposed common currency of the Economic Community of West African States (ECOWAS). Plans originally called for the West African Monetary Zone (WAMZ) states to introduce the currency first, which would eventually be merged with the Euro-pegged CFA franc which is used by the French-speaking West African region within the West African Economic and Monetary Union (UEMOA). This will also enable the UEMOA states to gain complete fiscal and monetary independence from France. The UEMOA states have alternatively proposed to reform the CFA franc into the eco first, which could then be extended to all ECOWAS states.
The goal of a common currency, first in West African Monetary Institute (WAMI)/West African Monetary Zone (WAMZ) countries —The Gambia, Ghana, Guinea-Conakry (which is French speaking, but does not use the CFA franc), Liberia, Nigeria, and Sierra Leone—and later in the whole ECOWAS area, was officially stated in December 2000 in connection with the formal launch of WAMZ. The Eco was first planned to be introduced in 2003, but this was postponed several times, to 2005, 2010 and 2014. At a meeting of the Convergence Council of Ministers and Governors of West Africa on 25 May 2009, the start of the currency was rescheduled to 2015 due to the 2008 financial crisis. The December 2009 meeting also established a plan to begin work to merge the Eco with the CFA franc immediately upon the launch of the Eco; this was planned to be achieved by 2020.
In 2001, the West African Monetary Institute (WAMI) was set up with headquarters in Accra, Ghana. It is to be an interim organization in preparation for the future West African Central Bank. Its function and organization are inspired by the European Monetary Institute. Thus, WAMI is to provide a framework for central banks in the WAMZ to start the integration and begin preliminary preparations for the printing and minting of the physical money, just as EMI did before in the Eurozone before the introduction of the euro. The current director general is Dr. Olorunsola E. Olowofeso.
The Eco has been pushed back several times since the launch of the ECOWAS single currency project, with the fifth launch deadline set for July 2027.
With all these developments, one would be compelled to wonder if the ECOWAS Eco currency will ever come alive …..
Additional Source: Africa News
