Benin President Patrice Talon has announced that foreign reserves of the West African CFA – currency used by eight countries in the region – were to be withdrawn from France.
In a wide ranging interview with French public broadcasters, RFI and France 24, Talon alluded to the move being unanimous for all the countries in question.
“We unanimously agree on this, to end this model,” he said, adding that the current model was more of a “psychological problem” than “technical.”
The central banks of African countries of WAMU (West African Monetary Union) will manage all of these foreign currency reserves and will distribute them to the various central banks partners in the world.
“The central banks of African countries of WAMU (West African Monetary Union) will manage all of these foreign currency reserves and will distribute them to the various central banks partners in the world.”
Talon said the regional bank’s task was to be dispatched “very quickly”, but he fell short of giving a specific timetable.
Countries under WAMU include: Benin, Togo, Burkina Faso, Mali, Senegal, Ivory Coast, Niger and Guinea-Bissau. It goes by the French initials, BCEAO.
Since 1945, the West African and Central African CFA have been pegged to the French francs and later the Euro and its reserves have been kept in France.
The Central African bloc of countries that use the CFA include: Chad, Central African Republic, Congo Republic, Gabon, Cameroon and Equatorial Guinea.
Some experts stressed that the move kept African economies largely dependent on the European monetary policy, a situation others routinely labeled “neo-colonialism” and which has evoked stern critique of France over the years.
In early October, French Finance Minister Bruno Le Maire said France was open to an “ambitious reform” of the CFA franc. He was echoing the thoughts of French president Emmanuel Macron whiles addressing students during a visit to Burkina Faso few years ago.
Bruno Le Maire was quoted as saying: “(…) What I can tell you is that the President of the Republic is ready for an ambitious reform of the franc zone. But I repeat: it is up to the member states of the franc zone to take the initiative, make proposals and measure how far they wish to go. “