The Final Call

The end of the world’s last colonial currency?

By Jehron Muhammad | Last updated: Nov 21, 2019 - 2:27:05 PM

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Italy’s Deputy Prime Minister blames France for creating poverty in Africa.

In January, Italy Deputy PM Luigi Di Maio infuriated France by saying, “France is one of those countries that by printing money for 14 African states prevents their economic development and contributes to the fact that the refugees leave and then die in the sea or arrive on our coasts. I have stopped being a hypocrite talking only about the effects of immigration and it’s time to talk about the causes. The EU should sanction all those countries like France that are impoverishing African countries and are causing those people to leave.”

The money the Italian minister was talking about was the CFA franc, which is notably used by former French colonies in the Motherland.

According to Mamadou Koulibaly, former speaker of the Ivorian National Assembly and professor of economics, “The CFA franc region represents a state-controlled zone of cooperation with, interestingly, the levers of control based in Paris, from where the priority is the interests of France. The satellite states that are members of this zone are dispersed in West and Central Africa. The operational logic driving the functioning of this zone brings to mind a similarity with the way the Eastern European states were linked during the Cold War to the former Soviet bloc through the Warsaw Pact.”

Questioned in November concerning the French-controlled CFA franc and the Economic Community of West African States (ECOWAS) proposal of a new single African currency, Patrice Talon, president of the Republic of Benin president, said the proposed currency, the “Eco,” will not be managed like France has singly managed the CFA. African countries will have full management of their currencies, he told the media.

CFA Franc

The eight-member nations of the West African Monetary Union “unanimously agree” on ending a decades-old model whereby their foreign exchange accumulation is kept at the French Treasury, Talon said in an interview with Radio France Internationale. Benin’s currency, the CFA franc, is pegged to the euro, and its convertibility is guaranteed by her former colonial master.

“I can’t give you the date, but the willingness of everyone is already there,” President Talon said in response to French Finance Minister Bruno Le Maire’s apparent openness to the currency reform. “Psychologically, with regards to the vision of sovereignty and managing your own money, it’s not good that this model continues,” observed Bloomberg, the business news outlet.

Responding to President Talon, a movement to dump the CFA Franc, Sortir du franc CFA or “Exit out of the franc CFA,” congratulated “the Beninese head of state for this courageous decision, which, if implemented, would de facto mark the end of the CFA franc, the last colonial currency in the world.”

Sortir du franc CFA added, “The debate on the CFA franc is not economic and technical, it is first and foremost a political and symbolic issue. You don’t have to be an economist or an expert to know the CFA franc is a psychological wound and humiliation for millions of Africans. France, by trying to maintain the CFA franc at all costs, is behaving like a colonial occupying power with our countries.”

The former African Union Ambassador to the U.S., Arikana Chihombori-Quao has been relentlessly campaigning for the French to end their “modern day colonialism,” which included requiring so-called Francophone nations to use the CFA franc and deposit their reserves in Paris banks.

The CFA franc is currently used by 155 million people on the continent across 14 African countries.

This is the first time a president has announced withdrawal of the West African CFA franc.

“We now unanimously agree that this model needs to end,” said President Talon. “The Central Bank of the West African Monetary Union will manage all of the currency reserves and will dispatch them to the different partner central banks across the world.”

The CFA is used in the Economic and Monetary Community of Central Africa (CEMAC) which includes Chad, Cameroon, Central African Republic, Gabon, Equatorial Guinea and Republic of Congo. And it also used in The West African Economic and Monetary Union (WAEMU) includes Senegal, Guinea-Bissau, Mali, Ivory Coast, Burkina Faso, Togo, Benin Republic and Niger.

The CFA Franc, according to thisisafrica.me, “was created in 1945 after the 1944 Bretton Woods Agreement which saw the world usher in a new global monetary system with the U.S. dollar replacing the gold standard. The Bretton Woods agreement cemented America’s dominance as the world economic power. The CFA franc is tied to the Euro and follows the fluctuation of the Euro. The creation of Eco, the newly proposed West African currency designed to replace the CFA franc by 2020, led to an official separation with the Euro.”

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