Franc Zone, in Retrospect and Prospect

World economic uncertainty, difficulties met by Central Africa after the oil price shortfall, progress in trade integration in West Africa lead to a new thinking about Franc Zone prospects. Franc Zone is more than fifty years old, and it has known many reforms, which, while maintaining basic principles, namely a fixed rate of exchange and a guarantee of convertibility through the “compte d’opérations” of the Central Banks (BCEAO and BEAC) at the French Treasury, have shown its capacity to adapt: Central Banks governance made African, Economic Unions set up, capital movements controlled, replacement of the French franc by euro, independence recognized to the Central Banks. Franc Zone may thus appear as a genuine and effective cooperation regime. It can still evolve, as done in the past, and at the request of African governments.Several perspectives are examined. Is it desirable to make the rate of exchange more flexible and how to make it? Are the “compte d’opérations” to be cancelled or is it preferable to change their working modalities and the French participation to the governance of the Central Banks? Is a geographical enlargement, in particular for WAEMU, compatible with maintening French support? Is the name of the currencies to be changed? The paper considers the benefits and difficulties of the various possible answers.

Guilllaumont, P. et Guillaumont Jeanneney, S. (2017) La Zone franc en perspective, Revue d'économie du développement, vol. 25(2), pp. 5-40.

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