Kako Nubukpo, a Togolese economist renowned for his research on the CFA franc, believes that adoption of the Eco is a historical and decisive step for the future of the continent. His anti-CFA stance has often caused controversy and for him, the Eco represents an important step forward that will help to restore West Africa’s monetary sovereignty.
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Can the announcement of the replacement of the CFA franc by the Eco in eight West African countries really be described as historic?
Nubukpo believes that this is a historic decision for two reasons. First, it is the first time in 75 years that the name of this currency has been changed. Since December 26, 1945, and despite the various changes, the acronym CFA has been kept for “French colonies in Africa.”
As a result, in the popular imagination, the CFA has not budged. However, Nubukpo argues that money, and the name we give it, goes beyond the framework of just the economy. It forms a part of a nation’s identity. For example, you need only look at the debates that took place when the Euro was created.
“Germany did not want to give up the Deutschmark because the Deutschmark is the German identity. You cannot ask the Americans today to count in yen because their identity is the dollar. The unit of account of the currency is the primary function of the currency.” explained Nubukpo.
A symbolic moment
In this context the announcement yesterday is significant. By removing the association of being a currency tied to former French colonies the new Eco currency is, in a way, breaking down the established order. In many ways, the decision to move to the Eco is more symbolic than economic.
The name of the currency is significant. The Eco is the name chosen for the future single currency of 15 countries of the Economic Community of West African States (ECOWAS) and could be viewed as a statement of intent.
Beyond symbolic implications, there are some serious practical reforms coming through as well. France has agreed to renounce its right to at least 50% of the foreign exchange reserves of the CFA zone countries. The country has also agreed to withdraw from all WAEMU decision making bodies, perhaps marking the final, albeit symbolic, stage in the decolonization of the region.
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First published in LePoint, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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