Why does the decision to end the CFA franc concern only the WAEMU zone and not the whole
of the fifteen countries ?
ECOWAS, which launched on 29 June 2019 in Abuja its process of creating a common currency, has
as a result, it fostered development in West Africa. That is, the credible alternative is already in
Motion. You do not have the same process in Central Africa. Then there is actually the Comoros,
who currently have no other alternative. But the situation can quite change in the
next weeks or months for Central Africa and comoros.
Won't the announced reform of the CFA "short-circuit" the single currency project of the
ECOWAS which includes the fifteen countries of the West African zone?
It is the opposite. It can be said that the decisions that have been announced will facilitate the implementation of
eco. On the one hand, we have ECOWAS which decided at the summit of 29 June 2019 in Abuja to create in
2020 a common currency called the eco. In these texts, the organization has set up criteria of
convergence. There are six of them, including the budget deficit, inflation, debt,
foreign exchange reserves, etc. However, it turns out that today it is the WAEMU countries that respect best
these criteria. Simply because they already exist within the WAEMU since 1999.
It turns out that the criteria required for countries that want to enter the eco are about the same as
those of the WAEMU. They are even more relaxed since in the WAEMU a rate
of inflation less than or equal to 3%, whereas in ECOWAS, an inflation rate less than or equal to
to 10%.
Won't this create tensions between the French Nigeria, more concerned about the future currency...
Nigeria demanded that the WAEMU countries sever all ties with the French Treasury before the concretization
of the eco. This is now done with the announcement of the end of the CFA franc. This decision created a
convergence of interests for each of the countries of the West African region.

So there will be no division between anglophones and francophones?
A priori no, since it is the fifteen countries that have agreed on the convergence criteria. There would have a problem if one of the WAEMU members met the criteria and was denied entry into
eco.
The subject that annoys is the fixed parity of the future currency, the eco with the euro.
The fixed rate of the eco with the euro is a transitional measure. President Alassane Ouattara said it
explicitly during the press conference. This is only to reassure investors. When on
creates a new currency, it is necessary to take into account the risks of capital flight or inflation such as
this is the case in other African countries. Failure to maintain the fixed rate could cause the franc
CFA on the market.
But you have always defended the argument that pegging to the euro, a strong currency, is problematic
for the economies of the region.
I still think so. That is why I say that we must remain vigilant on this issue. For me, the rate of
Fixed exchange rate between the eco and the euro only makes sense if it is for a transitional period to reassure the
Markets. But what the ECOWAS Heads of State decided on 29 June in Abuja is that in the long term
the eco would be in flexible exchange rate. In fact, the eco will be pegged to a basket of global currencies like
the dollar, the Chinese yuan, the yen etc. This will better reflect the diversity of our economic partners.
Decision-makers will thus have greater room for manoeuvre since the eco will be able to fluctuate. Today,
the problem with the CFA is that when the euro goes up, the CFA also goes up mechanically and it's not good
for the competitiveness of our countries, especially for the export of our products. But when you have a more flexible currency, you have more room for maneuver and you can appreciate and
depreciate it according to your competitiveness requirements.
It must be understood that the decision that has been taken is historic in the sense that sovereignty
monetary passes from Paris to West Africa. What I'm saying to leaders is that you can butter and butter money. We had a guarantor who was the France, but we felt that being
independent was not compatible with the subcontracting of our monetary sovereignty to Paris.
Now we are recovering our monetary sovereignty, it is up to us to manage it. The cord
umbilical. These are responsibilities. You can't want to be independent, but let it be the others
who manage a major element of our sovereignty, we must be consistent. In any case, the President
Emmanuel Macron got rid of that. It is to be hoped that our Heads of State are ready too.
Paris still retains its role as financial guarantor for the eight WAEMU countries, for what reasons
?
It was the African heads of State who asked the France to keep the guarantee for a time. Because
that when markets know that France guarantees, they are more confident. The reality is that we
we are perceived to be less credible than the France. This is the consequence of weak governance in
our countries. The markets do not trust our countries and that is the truth. It's played at the level of the
confidence. In absolute terms, the France will not need to put their hands in their pockets. There is enough b reserves to ensure the convertibility of the future currency.
Except in case of crisis...
Indeed, if the BCEAO faced a lack of availability to cover its liabilities in foreign currency,
she will be able to obtain the necessary euros from the France. This guarantee should take the form
a "line of credit".
What will become of the foreign exchange reserves estimated at 19 billion euros...
Reserves fluctuate between 15 and 19 billion good year, bad year. The Central Bank of African States of
the West will no longer have to deposit half of its foreign exchange reserves with the Bank of France, it will be
free to invest your assets in the assets of your choice with the various banking institutions or
Financial. I proposed, for example, that these reserves be deposited with the Bank of
international regulations located in Basel, Switzerland. This bank was created to make settlements
International. The purpose of foreign exchange reserves is to pay for our imports and receive the
product of our exports, so they are used for international regulations. A country like Madagascar, which no longer belongs to the franc zone since 1973, has its accounts with the Banque des
international regulations. But it is one proposal among others. In the end, it is the central bank that
must arbitrate between the security of deposits and the remuneration of these deposits, because it is indeed a savings. You just have to make sure that the institution with which the deposit is made is not going to go bankrupt and that this money
is well paid because it affects the central bank's operating account.