There are two ways that they might go about it. First, franc-zone countries could issue their own currencies — a radical approach that would face serious obstacles. France wields overwhelming political clout in its former African colonies, including veto power over the franc zone’s two central banks. France can thus block any move that it deems a threat to its interests. Moreover, the franc-zone countries that are small and produce no oil prefer to pool their reserves to reduce their vulnerability to external shocks.
The second way implies a thorough overhaul of the system. This would entail pegging the CFA franc not only to the euro, but also to a basket of other currencies, abolishing the fixed exchange rate and the CFA franc’s convertibility, and fast-tracking economic integration. However, as the euro’s current troubles demonstrate, a common currency requires unified and centrally established monetary and fiscal policies, which presupposes political integration — a process that is likely to be no less difficult in Africa than it has proved to be in Europe.
There is no easy answer, but it is time for the franc zone’s two leading regional groupings — the West African Economic and Monetary Union and the Central African Economic and Monetary Community — to begin playing a decisive role in overhauling the franc zone’s architecture. France may not like it, but the best interests of the franc zone’s citizens should come first.
Sanou Mbaye is a former senior executive of the African Development Bank.
Copyright: Project Syndicate
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