Consequences of Mali, B’Faso, Niger Exiting ECOWAS
Did you know that Burkina Faso, Mali, and Niger Republic might be cut off from the $702 billion strong Economic Community of West African States (ECOWAS) economy? This could have some serious effects on these countries and the region as a whole.
The Impact on Food Insecurity and Fragile Economies
If these countries leave ECOWAS, it could make the problem of food insecurity even worse in the region. Additionally, their already fragile economies could suffer even more. These countries are landlocked and among the poorest in the region, with an annual per-capita gross domestic product of less than $1,000. Leaving ECOWAS would mean facing higher tariffs and restrictions on the movement of goods and financial flows.
The Silly Own Goal
Charlie Robertson, the head of macro-strategy at FIM Partners, called the decision to leave ECOWAS a “silly own goal.” He explained that these countries would lose access to markets like Nigeria and Ghana, which have a combined GDP of $467 billion. This means they would miss out on a lot of economic opportunities.
The Benefits of ECOWAS Membership
Being a member of ECOWAS comes with benefits like the free movement of goods, capital, and people within the economic bloc. Ivory Coast, Ghana, and Nigeria dominate trade between the 15 member countries. While the current trade volume is relatively small at about $277 million, it has the potential to grow to as much as $2 billion in the next few years, according to the International Trade Centre.
The Joint Statement
In a joint statement released by the military leaders of Burkina Faso, Mali, and Niger Republic, they expressed their disappointment with ECOWAS and announced their withdrawal from the regional economic bloc. They stated that they made their decision in response to the expectations and concerns of their populations.
The IMF’s Perspective
The International Monetary Fund (IMF) is closely monitoring the situation. Pierre-Olivier Gourinchas, the IMF’s chief economist, stated that having an integrated economic area like ECOWAS is favorable for trade and growth. Moving away from this could have the opposite effect.
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