The CFA franc: A “hyper-colonial” Currency

Nicoletta Fagiolo

“It is not a book against France, nor against Africa, but a book that explains a monetary mechanism that can be described as perverse, because it blocks the development of African countries that are a part of it”, with these words Senegalese economist Ndongo Samba Sylla opened the conference organized at the City of Other Economics in Rome on 14 May 2019 by Fazi publisher, who published the Italian version of the book written together with French journalist Fanny Pigeaud, L’arme invisible de la françafrique, (Françafrique’s invisible arm in Africa)  on the a history of the CFA franc.[i]

The acronym CFA refers to two current monetary and economic unions in West and Central Africa: the West African CFA franc brings together the eight members of the West African Economic and Monetary Union (WAEMU) – Benin, Burkina Faso, Ivory Coast, Guinea Bissau, Mali, Niger, Senegal and Togo; -the Central African CFA franc comprises the six members of the Central African Economic and Monetary Community (CEMAC)– Cameroon, the Central African Republic, the Republic of the Congo, Gabon, Equatorial Guinea and Chad. Today the area has a population of over 160 million inhabitants spread across fourteen countries.[ii]

At its creation, in December 1945 the acronym CFA meant the franc of the French colonies of Africa – today, it designates the franc of the African financial community for the WAEMU countries and the franc of financial cooperation in Central Africa for the CEMAC countries.

Ndongo Samba Sylla has worked in the field of development economics and is today research director for West Africa of the Rosa Luxemburg Foundation in Dakar, so his point of view is multidisciplinary, embracing economics, as well as historical and geopolitical aspects.

French journalist Fanny Pigeaud has already written extensively on the history of Ivory Coast, Cameroon and Madagascar. The sources of the book are very varied, ranging from direct testimonials (some anonymous, recalling the silence surrounding the subject still present today), official reports, historical accounts, newspaper articles and economic analysis. Sylla reminds us, quoting Aristotle’s Nicomachean Ethics that the etymological root in Greek for money is the same that designates the word law, nomos, and therefore every monetary asset is necessarily accompanied by a political order.

The CFA franc is the heir of the French franc imposed in past centuries through the use of violence in the vast French empire that extended from Africa, Asia, the Pacific, the Antilles and the Americas. The repression against the natives who refused to abandon their African money- such as rubber, iron, copper or salt bars, manillas, shells, cotton, pearls, etc. – for the French franc was fierce.

In 1925 a law included in the new Code de l’indigénat, (code of administrative justice which applied only to indigenous people), set out the obligation to use the French franc in commercial transactions under penalty of punishment. The African rebellions against this monetary imposition were numerous: from boycotts, counterfeiting, to the obstinacy in using one’s own money continued until well into the twentieth century.

Currency boards, born in the respective colonial empires at the beginning of the 20th century – British, Portuguese, Spanish, French – were devised to secure a supply of raw materials from the occupied areas and control their commercial flow. These institutions became channels for the drainage of capital from an underdeveloped economy to the benefit of a developed economy.

While the other colonial monetary areas, including the French[iii] in North Africa (Algeria, Morocco, Tunisia), Middle East (Syria and Lebanon) and Indochina (Vietnam, Cambodia, Laos) were dissolved with the county’s achieving independence, the CFA franc area remained in the hands of the French.

Despite an Africanization of executives, France is still present today: it has seen its representation reduced from a third to a seventh in 1972-73 on the boards of the respective central banks[iv], the BEAC (Bank of Central African States) for the CEMACarea and the BCEAO (Central Bank of the West African States) for the WAMEU area; it is also present in the monetary policy committees which since 2007 for BEAC and and 2010 for the BCEAO, following the European policy of state-independent banks, are the main decision-making bodies of monetary policies in the respective areas; at the biannual meetings of the Council of Finance Ministers and Annual Conference of Heads of State and Government.

Ndongo Samba Sylla in Money on the left: comparing monetary imperialism in Francophone Africa[v] asks if we can talk about decolonization without taking into account who manages the monetary system.

This colonial setup was able to remain in place only because true independence was never achieved: the African countries in the CFA area were asked, so as to acquire formal independence at the time, to sign cooperation agreements with France in areas such as trade, military, defence and culture.

Those who rebelled against the French CFA system paid serious consequences, such as the  President of Togo Sylvanus Olympio and the President of Burkina Faso Thomas Sankara, both assassinated, Olympio in 1963 and Sankara in 1987. A whole chapter in L’arme invisible de la françafrique is dedicated to the brave rebels who challenged this neo-colonial system.

The most prominent victims of contemporary françafrique are former Ivorian President Laurent Gbagbo and his wife Simone Gbagbo, along with activist and youth minister Charles Blé Goudé.[vi]

Read RESET article here: https://www.resetdoc.org/story/essay-cfa-franc-hyper-colonial-currency/