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Business News

West Africa’s monetary union changes CFA franc to Eco

All former French Colonies in West Africa, except Guinea Bissau, have agreed with France to rename its CFA franc to the Eco as they cut some of the financial links with Paris, French. #CFA FRANC #ECO #MACRON #CURRENCY

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Emmanuel Macron

All former French Colonies in West Africa, except Guinea Bissau, have agreed with France to rename its CFA franc to the Eco as they cut some of the financial links with Paris, French.

It is generally believed that the CFA franc has underpinned the region’s common currency since its creation after World War Two.

What it means: With the development, while the Eco will remain pegged to the Euro, the African countries in the bloc won’t have to keep 50% of their reserves in the French Treasury and there will no longer be a French representative on the currency union’s board.

[READ ALSO: GlaxoSmithKline Nigeria Plc gets new Managing Director(Opens in a new browser tab)]

The emergence of the currency has been greeted with mixed feelings. While critics of the CFA have long seen it as a relic from colonial times, its supporters said it has provided financial stability when the region was faced with turbulence.

What the leaders say …

The Presidents of Ivory Coast and France also shared their thoughts about the new currency. As far as President Alassane Quattara of Ivory Coast is concerned, “This is a historic day for West Africa.”

For the French President Emmanuel Macron, it is a welcome development. Macron highlighted the stabilizing benefits of the CFA but said it was up to African governments to determine the future of the currency.

Yes, it’s the end of certain relics of the past. Yes, it’s progress … I do not want influence through guardianship, I do not want influence through intrusion. That’s not the century that’s being built today,” said Macron.

How it works: CFA is used across 14 African countries with a combined population of about 150 million and $235 billion of gross domestic product.

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The changes will only affect the West African form of the currency used by Benin, Burkina Faso, Guinea Bissau, Ivory Coast, Mali, Niger, Senegal, and Togo – all former French colonies except Guinea Bissau.

A Reuters report said that the six countries using the Central African CFA are Cameroon, Chad, Central African Republic, Congo Republic, Equatorial Guinea, and Gabon. The CFA’s value relative to the French franc remained unchanged from 1948 through to 1994 when it was devalued by 50% to boost exports from the region.

After the devaluation, 1 French franc was worth 100 CFA and when the French currency joined the eurozone, the fixed-rate became 1 euro to 656 CFA francs.

Stanbic 728 x 90

The CFA franc was born in 1945 and at the time stood for “Colonies Francaises d’Afrique” (French Colonies in Africa).

 

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Abiola has spent about 14 years in journalism. His career has covered some top local print media like TELL Magazine, Broad Street Journal, The Point Newspaper.The Bloomberg MEI alumni has interviewed some of the most influential figures of the IMF, G-20 Summit, Pre-G20 Central Bank Governors and Finance Ministers, Critical Communication World Conference.The multiple award winner is variously trained in business and markets journalism at Lagos Business School, and Pan-Atlantic University. You may contact him via email - [email protected]

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Business News

Senate calls for the liberalization of cement policy to crash the price of the commodity

The Senate also tasked the FG on providing more industrial incentives to bring new players into the cement industry.

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BUA Cement

The Nigerian Senate has called for the liberalization of Nigeria’s cement policy to boost production and subsequently crash the price of the commodity in the country.

This motion was raised by Senator Lola Ashiru at today’s senate plenary, the senator also tasked the Federal Government on providing more industrial incentives to bring new players into the cement industry, in addition to the liberalization of the cement policy in Nigeria.

Ashiru explained that to reduce the price of cement and in extension, other building materials in the country, the Federal Government needs to provide an enabling operating environment that will encourage new entrants in the country.

The Senate in conclusion called on the FG to provide more industrial incentives and protections such as concessionary loans and larger tax incentives to encourage new entrants and expand the national cement production infrastructure, as this boost in production will lead to a downward review of cement price in Nigeria.

What industry leaders are saying

Earlier this year the founder of BUA Group, Abdulsamad Rabiu, called for the liberalization of Nigeria’s cement policy to boost production and reduce the price of the commodity.

The billionaire philanthropist faulted the belief that Nigeria is self-sufficient in terms of cement production, noting that recent statistics and figures on Nigeria’s population and cement production do not support this status of sufficiency in cement production as stated by some individuals.

He attributed the high price of cement products in the country to the supply gap which exists in the country, as the few producers who currently operate in the country are unable able to meet the country’s huge and growing demand.

The Group Executive Director, Strategy, Portfolio Development and Capital Projects, Devakumar Edwin, explained that the demand and consumption of cement in the nation currently outstrips supply, and this can be pegged on the growth in the country’s population, and the strong appetite for real estate investment and construction in the country.

He revealed that a supply gap of about 40% exists in the country’s cement market and that all players in the industry are working hard to level production with the rising demand in the country.

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Paypal’s Venmo now permits cryptocurrency trading

Venmo will support four different cryptocurrencies: Bitcoin, Ethereum, Bitcoin Cash, and Litecoin.

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Venmo, a mobile payment service owned by PayPal has announced that it has started allowing users to buy, hold and sell cryptocurrencies on its app. Just like PayPal, Venmo will support four different cryptocurrencies: Bitcoin, Ethereum, Bitcoin Cash, and Litecoin, and users can carry out transactions with as little as $1 on the app

Founded in 2009, Venmo has over 70 million users and it is one of the most popular payment channels in the US. The payment platform processed around $159 billion in payments last year.

Since the app functions like a social network, adding cryptocurrency will offer a more user-friendly feel for people who love buying and selling crypto.

READ: 28 million merchants to be granted crypto usage on PayPal

As bigger companies show more interest in cryptocurrency, there will be wider adoption of virtual currencies in future. Venmo is the latest payment app that is offering support for cryptocurrency on its platform.

Paypal, the parent company of Venmo is one of the most active companies in the crypto space as it allows users to buy, sell and hold cryptocurrencies in their digital wallets. Paypal users can also spend their coins at millions of merchants globally.

Crypto on Venmo is enabled through PayPal’s partnership with Paxos Trust Company, a regulated provider of cryptocurrency products and services.

What they are saying

Darrell Esch, Venmo’s Senior Vice President and general manager said “Our goal is to provide our customers with an easy-to-use platform that simplifies the process of buying and selling cryptocurrencies and demystifies some of the common questions and misconceptions that consumers may have.”

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