Burkina Faso, Mali, and Niger Republic are set to be cut off from the $702bn strong Economic Community of West African States economy following their planned exits.
This potential exit could further worsen widespread food
insecurity in the region as well as backfire on already fragile economies.
A report from Bloomberg on Wednesday highlighted that the
trio of countries are all landlocked and among the poorest in the region, with
their annual per-capita gross domestic product of less than $1,000. It stated
that exiting the ECOWAS region would expose them to increased tariffs and
restrictions on the movement of goods and financial flows.
In an emailed note, head of macro-strategy at FIM Partners,
Charlie Robertson, wrote of the exit, “The military coup leaders who control
Burkina Faso, Mali, and Niger have managed to score the silliest own goal since
the UK voted for Brexit.
“They take out eight per cent of Ecowas’ GDP and lose access
to markets like Nigeria and Ghana, which together have a GDP of $467bn.”
Members of the economic bloc benefit from the free movement
of goods, capital, and people within, and trade between its 15 members is
dominated by Ivory Coast, Ghana, and Nigeria, and remains relatively small at
about $277m and has the potential to grow to as much as $2bn over the next few
years, the International Trade Centre said in 2023.
The PUNCH recently reported that the exit of the three
countries may weaken the $277.22bn trade of ECOWAS with the rest of the world
while weakening the regional economic bloc’s contribution to the African
Continental Free Trade Area.
On Sunday, the three countries in a joint statement released
in Ouagadougou, Bamako, and Niamey by their military leaders, Capt. Ibrahim
Traoré (Burkina Faso), Col. Assimi Goita (Mali), and Brig. Gen. Abdourahamane
Tiani (Niger Republic), announced their withdrawal from the regional economic
bloc.
They said, “After 49 years of existence, the valiant people
of Burkina, Mali, and Niger note with much regret, bitterness, and great
disappointment that their organisation has moved away from the ideals of its
founding fathers and pan-Africanism.”
They added, “… taking all their responsibilities in the face
of history and responding to the expectations, concerns, and aspirations of
their populations, decide in complete sovereignty on the immediate withdrawal
of Burkina Faso, Mali, and Niger from the Economic Community of West African
States.”
Commenting on the ECOWAS situation in a hybrid press
briefing on Tuesday in Johannesburg, the International Monetary Fund’s chief
economist, Pierre-Olivier Gourinchas, noted that the IMF is currently
monitoring the situation.
Gourinchas said, “On the impact of Mali, Niger, and Burkina
Faso leaving ECOWAS, that was announced yesterday, this is something that of
course we are monitoring.
“We are taking note it is a bit early to assess what the
impact is going to be. But of course, our assessment is that in general, having
an integrated economic area is something that is going to be favorable,
conducive to trade, and conducive to higher growth. And sort of moving away
from this is going to have the opposite effects.”
0 comments:
Post a Comment