According to Reuters, the heads of state of central Africa's CFA franc zone
are to audit their central bank's investments with France-based Societe Generale (SOGN.
A: The CFA franc zone
has engendered a long-running debate which continues to raise new arguments among economists.
The WAEMU and CAEMC are two subzones of the CFA franc zone
and operate rigid exchange rate pegs to the Euro at a fixed rate of Eurol:CFA655.
A) The CFA franc Zone
currently consists of two separate groups of sub-Saharan African countries.
Principal African currencies such as those of the 14-member CFA franc zone
, the Rand Monetary bloc comprising South Africa, Lesotho, Namibia and Swaziland and the Maghreb currencies of Algeria, Morocco and Tunisia, have all enjoyed a sustained period of exchange rate stability.
France planted the roots of the CFA franc zone
Against this background, and in consultation with other members of the CFA franc zone
facing similar problems, the government decided to broaden its strategy of economic adjustment by devaluing the CFA franc effective Jan.
Madagascar has a tradition of wanting to emphasise its independence from former colonial ties and originally left the CFA franc zone
Recognizing that it could not rely solely on internal adjustment to restore competitiveness, diversify the economy, and improve productivity, the government joined the other members of the CFA franc zone
in broadening its adjustment strategy to include a devaluation of the CFA franc by 50 percent, effective January 12, 1994.
This will be preceded by a single monetary zone from January 2003, which in turn will merge with the seven CFA franc zone
members: Benin, Burkina Faso, Cote d'Ivoire, Mali, Niger, Senegal and Togo.
Against this background, Benin joined other member countries of the CFA franc zone
in strengthening its adjustment strategy through a devaluation of the CFA franc against the French franc with effect from January 12, 1994.
He suggested something that would have certainly made Professor Haan glow with joy: "Minting an independent African currency, initially restricted to the 15 member-countries of the CFA franc zone
but [later open] to other regions and countries of Africa.