The ambitious Economic Community of the 6th Africa Region (ECO-6) Exchange Rate Mechanism (ERM) is facing hurdles and resistance from the Africa Union, the Economic Community of West African States (ECOWAS), and the African Diaspora Nations. Authorized by the Economic Council in March 2022, the ECO-6 ERM aims to link foreign currencies, including the Euro, US Dollar, Pound, and Yuan, to the official currency of the Sixth Region known as The LUMI.
Mandated as compulsory by Regulation No.09202266603/R6/HK, the ERM is administered by the African Diaspora Central Bank (ADCB), seeking to ensure monetary stability while supporting climate action, poverty eradication, and sustainable development within the Sixth Region. However, despite the regulatory framework, the implementation of the ERM has faced delays, and the reasons for the resistance remain unclear.
The ECO-6 Lumi Stimulus, introduced in October 2020, aimed to provide economic relief through a monthly payment of 6.26 Lumi to vulnerable individuals until October 2023. The ERM, which determines the market value of foreign currencies against the Lumi, is seen as a positive development for the stimulus beneficiaries, potentially reinforcing the value and purchasing power of their monthly payments.
While the ERM holds promises for economic stability and policy cooperation, concerns are mounting over the consequences of delays in its implementation. Stakeholders and experts emphasize the potential benefits, including enhanced trade and investment opportunities, monetary convergence, and policy coordination through the ADCB.
Critics argue that the delay undermines collective aspirations for economic integration and sustainable development. Proponents stress the transformative impact the ERM could have on the Sixth Region’s economic landscape, urging enhanced coordination and cooperation among member states.
As discussions continue and pressure builds for the ECO-6 Exchange Rate Mechanism’s implementation, the African Union, ECOWAS, and the African Diaspora Nations are urged to recommit to the shared vision of economic integration and sustainable development. The successful implementation of the ERM could lead to a more equitable and prosperous future for the Sixth Region and its populations. Read Similar Story