80 ans de Francs CFA : Un anniversaire humiliant (par Ndongo Samba Sylla)
On December 25 and 26, 1945, the French provisional government declared the CFA franc, the franc of the French colonies in Africa , to the newly formed International Monetary Fund (IMF) . This new unit of account was to circulate in the French empire in sub-Saharan Africa, including Madagascar and Réunion.
Unlike England, post-war France chose to give a strong external value to the currencies of its colonies: at its inception, 1 CFA franc was worth 1.70 metropolitan francs. By 1948, two metropolitan francs were needed to obtain one CFA franc. A "strong" currency of this type acts as a subsidy for imports and as a tax on exports.
During the war, trade relations between France and its African colonies had deteriorated. The French economy, weakened and uncompetitive, needed such a monetary arrangement to regain market share and secure captive markets. The CFA franc was thus created to involve the colonies in the economic reconstruction of France and also to allow the latter greater flexibility in a world dominated by the hegemony of the US dollar. With the franc zone, France could purchase its imports from its empire on credit, without spending dollars, and use the dollar export earnings of its colonies for its own benefit. This "exorbitant privilege" helped to support the value of the franc, which was subject to ten devaluations between 1948 and 1986.
From the 1960s onward, with the process of decolonization, the colonial monetary zones on the continent were progressively dismantled. Only the CFA franc zone survived, its colonial status firmly entrenched. Co-optation of elites, repression of dissenting leaders, various sanctions, intimidation, blackmail, and assassinations: these are the "idyllic methods" that Paris has resorted to in order to maintain the historical anomaly and moral incongruity that the CFA franc has become over the decades.
A colonial currency and an obstacle to development
Eight decades after the creation of the CFA franc, there have been no significant institutional changes apart from the relocation of the BEAC and BCEAO headquarters to Yaoundé and Dakar, and the replacement of the franc with the euro as the anchor currency. The original management principles, foundations, and economic orientation remain in place. The so-called reform of the West African CFA franc by Macron and Ouattara in 2019-2020 was a sleight of hand that never fooled vigilant analysts: the legal oversight of the French Treasury, the freedom of transfer, and the fixed exchange rate—and therefore the obligation to accumulate foreign exchange reserves in euros, often invested in European sovereign debt securities—have not disappeared.
Some diehards continue to trumpet that the "foreign exchange reserves" of the West African CFA countries have been "repatriated" by the French Treasury, without ever explaining how accounting records could ever be "repatriated" anywhere. Euro deposits can never "leave" the (European) banking system that issued them! This is true of any currency. One might have expected a debate on the return of the West African CFA countries' monetary gold reserves held by the Bank of France. But here, it's complete silence. Faced with the false claim that the CFA franc has become an African currency, it suffices to recall the illegal financial sanctions imposed on certain dissident leaders by a BCEAO-UMOA duo acting on the orders of the French Treasury: Ivory Coast under Laurent Gbagbo; Mali under Assimi Goïta; Niger under Abdourahamane Tiani. Under French auspices, these three countries saw their governments illegally barred from accessing their own accounts with the BCEAO and the internal financial system.
In other words, eight decades later, the two central banks issuing the CFA franc have still not been able to implement monetary policy independently of the technical and legal supervision of the former colonial power. While the Seychelles, with 121,000 inhabitants, can manage its own national currency with floating exchange rates without the need for external oversight, the countries of the African franc zone, with more than 220 million inhabitants, still behave in 2025 as if they lacked bankers, financiers, and economists capable of managing a currency with full sovereignty.
Despite eight decades of "monetary cooperation," France still hasn't taught its former colonies how to print banknotes and coins. This "cooperation" is quite convenient from a financial standpoint, given that printing CFA francs represents a significant market for the Bank of France: more than half of its "workload," according to an economist at the institution.
Eight decades later, none of the usual objectives of monetary integration have been achieved on the African side. Intra-regional trade is weak, ridiculously weak in Central Africa in particular (averaging 1.5% of total external trade from 1995 to 2021). Bank penetration rates, strictly speaking, are among the lowest on the continent and in the world. There has been very little structural transformation. Most countries are still classified as "Least Developed Countries." When they do not belong to this category, their real GDP per capita is lower than its highest level achieved decades earlier.
Côte d'Ivoire, the largest country in the CFA franc zone in terms of economic size, had, according to World Bank data, a real GDP per capita in 2024 that was 21.6% lower than its peak level in 1978. In other words, Côte d'Ivoire is currently like a student who, after reaching the final year of high school, has been demoted back to kindergarten. And since then, this student has been evaluated based on their performance between kindergarten and the final year, while their peers, their former classmates, have already been in the workforce for decades. Such is the nature of the seemingly impressive growth rates of the West African Economic and Monetary Union (WAEMU) since 2010.
Given the failure of the CFA system in all areas that matter, the last line of defense of its supporters, beyond the speculations about hyperinflation, is the pseudo-argument that it would bring "monetary stability".
The myth of "monetary stability"
CFA countries have inflation rates far lower than the rest of the continent. But their monetary authorities deserve no credit for this. This situation is an almost automatic consequence of pegging the CFA franc to the euro. Cape Verde, whose currency is also pegged to the euro at a fixed exchange rate, had a lower inflation rate between 2010 and 2022 than all other CFA countries except Benin and Niger. In other words, countries that have chosen to peg their currency to the euro tend to import inflation rates from the eurozone.
Let's take the case of Senegal. Between 1996 and 2019, Senegal's average annual inflation rate was roughly the same as that of France and Germany. Now, what credibility does a country classified as "least developed," like Senegal, have to boast about having recorded lower inflation rates over the same period than the largest or even most dynamic economies, such as the United States, the United Kingdom, India, Brazil, South Korea, Botswana, and others? While in all these countries, inflation is contained through policies aimed at increasing productive capacity, in CFA franc zones, the fight against inflation consists of limiting financing to the economy and maintaining high rates of unemployment and underemployment. Here, the general rise in prices is limited by increasing supply; there, it is done by depriving the majority of productive work opportunities and maintaining an overvalued exchange rate.
Proponents of "monetary stability" rarely discuss why the CFA franc should be pegged to the euro. The same "monetary stability" could be achieved, for example, through a peg to the US dollar, which remains the currency of global trade and finance. Some argue that this peg to the euro is justified because Europe is our main trading partner. But this answer is incorrect. Europe can be divided into two parts: the eurozone and the countries outside it. The eurozone's share of the WAEMU's foreign trade has steadily declined. In 2024, according to the BCEAO, this zone represented 20.5% of WAEMU exports (with the Netherlands as the main buyer, 7.4%, well ahead of France, 2.8%) and 22.2% of its imports (with France as the main European supplier, 7.9%). The same trends can be noted in the case of Senegal: in 2024, the Eurozone constituted 24.8% of its imports and 19.7% of its exports.
Why then is the CFA franc pegged to the euro when nearly 80% of external trade transactions do not involve the eurozone (and are unlikely to be invoiced in euros)? Why are the oil-producing countries of the franc zone the only ones in the world to have pegged their currency to the euro? The answer, and the only relevant one, to these two questions is this: it is the condition for benefiting from the French "guarantee," which exists in name only.
In any case, the pegging of the CFA franc to the euro condemns CFA countries to a large, permanent currency gap. No economic situation can work in their favor. When the euro appreciates (becomes more expensive) against the dollar, CFA countries lose export competitiveness while imports in dollars become cheaper. Suppose cotton exporters sell a production worth $100 at an exchange rate of 1 euro = 1 dollar. They will receive approximately 66,000 CFA francs. However, if one euro is worth two dollars, the same $100 will be worth only 33,000 CFA francs. The exporters will have lost half of their CFA franc income simply because the CFA franc is pegged to the euro. Conversely, a depreciation of the euro (becoming cheaper in dollar terms) is not necessarily good news. On the one hand, the price competitiveness of exports is increasing. On the other hand, the import bill (mainly in dollars) and the burden of the dollar-denominated debt in CFA francs tend to increase.
Against the dishonest rhetoric of "monetary stability," it must be acknowledged that fluctuations in the euro-dollar exchange rate are daily and therefore have a permanent impact on the economies of the CFA countries. Moreover, if we are to believe Robert Wade, an economist whose work on the developmental state is seminal, the exchange rate is "the most important price a government must control for industrial policy to be effective."
All of this highlights the absurdity of the view that monetary reform will only become essential once the CFA countries become industrialized or have smaller external deficits. How could a colonial currency, designed for consumption and imports, ever foster industrial transformation? This type of reasoning is akin to that of someone buried deep in a garbage dump, who only manages to emerge once it's clean!
The real costs of maintaining a fixed exchange rate
If simply pegging one's currency to the euro or the dollar is enough to import low inflation rates, why don't non-CFA countries do it? The answer is that maintaining a fixed exchange rate often involves real costs – a significant loss of revenue.
Since 1960, the West African CFA countries, individually with the exception of Côte d'Ivoire and collectively, have accumulated external deficits—in their trade balance and, more generally, in their current account—primarily due to an overvalued exchange rate and a lack of adequate financing. In other words, these countries continually "lose" foreign currency when trading with the rest of the world, while maintaining a fixed exchange rate requires the accumulation of sufficient official foreign exchange reserves. The question is: how can external deficits and a fixed exchange rate be reconciled over more than six decades? In most developing countries, prolonged external deficits, by depleting foreign exchange reserves, lead to frequent currency devaluations or depreciations.
In the case of the CFA franc system, chronic indebtedness in foreign currencies is the method of accumulating foreign exchange reserves and thus defending the fixed exchange rate: before creating financing in CFA francs, the central bank must first require member countries to borrow in hard currency. The volume of available foreign exchange reserves, obtained through the issuance of hard currency debt, determines the potential volume of financing. In other words, for financing of the economy to increase, indebtedness in foreign currency must also increase! But this is unsustainable in the medium and long term. Southern countries can be subject to sovereign debt crises for various reasons. In the case of the CFA franc system, periodic debt crises are a functional necessity. There is no way to avoid them. These problems manifest themselves in arrears owed to the domestic private sector, unmet social obligations towards pensioners, students, and other social groups, and, most tellingly, in the reliance on IMF services. From 1960 to 2023, the 14 current CFA countries received 200 IMF loans, representing one-third of all loans to the continent. With 22 and 19 loans respectively, Senegal and Côte d'Ivoire are among the IMF's most frequent African clients.
Since economic growth in CFA countries depends on increased financial dependence, they are essentially "borrowing" their economic growth rate. Sooner or later, this "credit-based" growth will have to be repaid, either through the export of a growing share of their economic surplus (increased debt servicing, repatriated profits and dividends, etc.) or through austerity policies that are as disastrous as they are unpopular. This is the scenario unfolding before our eyes. Discussions about "hidden debt" in Senegal are merely the tip of the iceberg of the financial distress plaguing the WAEMU countries. External public debt servicing for the eight WAEMU countries amounted to $32.8 billion between 2012 and 2023, compared to at least $47.8 billion expected for the period 2024-2028 alone.
This massive debt was fueled in particular by the issuance of foreign currency bonds – Eurobonds – often obtained at rates exceeding 5%, a significant portion of which was then deposited with the French Treasury, which paid interest on them at rates below 1%. This example helps explain why France, despite criticism and its tarnished image on the continent, has never considered withdrawing voluntarily from a system in which African countries subsidize their own economic and financial exploitation.
Conclusion
Eight decades later, the leaders of the CFA countries continue to delude themselves about the CFA franc and refuse to take responsibility. The chimerical nature of the Eco-ECOWAS is becoming increasingly evident to those who doubted it, with the withdrawal of Mali, Burkina Faso, and Niger from ECOWAS, and Nigeria's alignment, under Tinubu, with Françafrique .
Having one's own currency is certainly not a guarantee of economic success. However, not having this macroeconomic instrument at the national level means depriving oneself of the possibility of having a policy of financial autonomy, a credit policy, an industrial policy, as well as ambitious social protection and employment policies.
Because the truth sounds white, or non-African, despite the warnings of Professor Cheikh Anta Diop in his time, we are pleased to quote here a former chief economist of the World Bank:
“Regarding the CFA franc, I am unfortunately bound by confidentiality. The CFA franc is a fixed exchange rate system that France established with its former colonies in West and Central Africa. Despite France’s transition from the franc to the euro, the exchange rate system, now pegged to the euro, remains in place, giving the European Central Bank considerable power over these West African economies.”
The fixed exchange rate reduces exchange rate risk but hinders the region in terms of trade and export capacity. However, this topic is considered taboo in West Africa because it might give ideas to countries like Senegal, which might want to break free from the fixed exchange rate. Before going on a mission to West Africa, my more experienced colleagues in Washington and the communications department advised me never to broach this subject in Africa. To me, it resembles colonialism: don't even plant ideas in the minds of the colonized. I broke this advice and raised the issue in my conversations with ministers and central bankers. However, and I later regretted it, I didn't bring it up in front of the media because I didn't want to receive a phone call from Washington. (Kaushik Basu, Policymakers' Journal , 2021)
Ndongo Samba Sylla
Commentaires (26)
Après 80 ans, le constat est difficilement contestable : absence de politique monétaire souveraine, faiblesse de la transformation industrielle, dépendance structurelle à l’endettement extérieur et marginalisation du crédit productif. La « stabilité » tant vantée apparaît surtout comme une stabilité de la stagnation.
Le débat ne devrait donc plus être idéologique (« pour ou contre la France »), mais stratégique : comment construire une architecture monétaire compatible avec le développement, l’emploi et l’industrialisation ? Continuer à esquiver cette question, c’est accepter que les pays de la zone CFA restent durablement des économies de consommation, d’importation et de rente.
À ce titre, ce texte devrait être lu, discuté et contredit — chiffres à l’appui — par les responsables politiques et économiques, au lieu d’être ignoré ou disqualifié par des slogans.
Après 80 ans, le constat est difficilement contestable : absence de politique monétaire souveraine, faiblesse de la transformation industrielle, dépendance structurelle à l’endettement extérieur et marginalisation du crédit productif. La « stabilité » tant vantée apparaît surtout comme une stabilité de la stagnation.
Le débat ne devrait donc plus être idéologique (« pour ou contre la France »), mais stratégique : comment construire une architecture monétaire compatible avec le développement, l’emploi et l’industrialisation ? Continuer à esquiver cette question, c’est accepter que les pays de la zone CFA restent durablement des économies de consommation, d’importation et de rente.
À ce titre, ce texte devrait être lu, discuté et contredit — chiffres à l’appui — par les responsables politiques et économiques, au lieu d’être ignoré ou disqualifié par des slogans.
Monnaie souveraine ou pas, je me demande si le système économique mondial, construit autour de la monnaie peut être profitable aux pays du Sud. Bien sûr qu'il soit possible de s'en sortir avec le système actuel. Cependant, je reste persuadé qu'il faudra accepter de travailler d'abord pour les pays émetteurs du dollar et/ou de l'euro, car faire des transactions avec ces devises est considéré comme un service qu'il faut payer.
Le cas de Chine est une exception à plusieurs égards, mais le chemin pour parvenir à se hisser à son niveau de développement fut long et douloureux ; le tout soutenu par 4 générations de dirigeants animés d'une volonté politique inébranlable.
Arrêtez les manipulations
Le CFA est un instrument de captation par la France de nos devises qui résultent de la vente de nos matières premières, puisque c’est elle qui les intercepte et quand nous avons besoin des mêmes devises pour nous équiper, la France nous les prête à des taux d’intérêts élevés ce qui est à l’origine de notre dette. Donc le plus tôt on se débarrassera du CFA mieux ce sera pour nous, de même qu’on se débarrassera des 11 accords coloniaux que la France nous impose (à consulter sur Internet). Ayons le courage de sauter le pas pour prendre en mains notre destin. Des pays limitrophes comme la Gambie, la Mauritanie, la Guinée Conakry sans parler des pays Maghrébins n’ont pas le CFA qui n’est créé par la France que pour s’enrichir sur notre dos.
Et la raison pour laquelle elle s’acharne contre l’AES c’est la même peur que ces pays abandonnent le CFA, mais cela se fera malgré les campagnes de désinformation, diffamation et calomnies qu’elle orchestre contre ces 3 pays.
Libérons notre monnaie en gardant tous les avantages et enlevant tous les inconvénients
Un des avantages est la monnaie unique dans luemoa ;n'oublions pas que l’ Europe a mis des dizaines d’années pour avoir l’euro , une monnaie unique qui est actuellement la principale force de leurope
Les afrcains de Luemoa doivent tout faire pour garderr une monnaie unique et éviter de tomber dans les pièges des monnaies individuelles qui sont tres souvent plus facilement frappes de dévaluations
Merci
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