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32-559: When it is fully implemented, the ACB will be the sole issuer of the African single currency (the " Afro " or " Afriq ") and/or working along African regional reserve banks, it will become the banker of the African Government and/or regional unions, it will be the banker to Africa's private and public banking institutions along African regional central banks, it will regulate, consult and supervise

64-481: A combined population of 210.4 million people (as of 2023), and a combined GDP of US$ 313.7 billion (as of 2023). Between 1945 and 1958, CFA stood for Colonies françaises d'Afrique ("French colonies of Africa"); then for Communauté française d'Afrique (" French Community of Africa") between 1958 (establishment of the French Fifth Republic ) and the independence of these African countries at

96-511: A common currency in the next ten years. So far only three of the 53 member states of the African Union in 2009 have committed to using the currency (in 2022, the African Union has 55 members). Egypt , Eswatini , and Lesotho have logged reservations over the precise date of monetary union and have requested a two- to three-year delay. Seychelles may not join as a result of economic fears and may, along with Cape Verde , attempt to join

128-463: A speeding up of this process, with creation by 2020. When it is fully implemented via Pan-African Parliament legislation, the ACB will be the sole issuer of the African single currency (African Monetary Union/Afro), will become the banker of African Governments, will be the banker to Africa's private and public banking institutions, will regulate and supervise the African banking industry , and will set

160-534: Is a stub . You can help Misplaced Pages by expanding it . African Monetary Union The African Monetary Union ( AMU ) is the proposed creation of an economic and monetary union for the countries of the African Union , administered by the African Central Bank . Such a union would call for the creation of a new unified currency, similar to the euro ; the hypothetical currency is sometimes referred to as

192-613: Is issued by the BEAC ( Banque des États de l'Afrique Centrale , i.e., "Bank of the Central African States"), located in Yaoundé , Cameroon , for the six countries of the CEMAC ( Communauté Économique et Monétaire de l'Afrique Centrale , i.e., " Economic and Monetary Community of Central Africa "): These six countries have a combined population of 62.8 million people (as of 2023), and

224-656: Is known in French as the Franc CFA , where CFA stands for Communauté financière d'Afrique ('Financial Community of Africa') or Communauté Financière Africaine ("African Financial Community"). It is issued by the BCEAO ( Banque Centrale des États de l'Afrique de l'Ouest , i.e., "Central Bank of the West African States"), located in Dakar , Senegal , for the eight countries of

256-792: The African Economic Community , and called for an African Central Bank to follow by 2028. As of 2019 , the plan is to establish an African Economic Community with a single currency by 2023. There are two existing regional currency unions in Africa , using the West African CFA franc , and the Central African CFA franc , respectively. Additionally, the Common Monetary Area links several countries in Southern Africa based on

288-611: The Bretton Woods Agreement in December 1945, the French franc was devalued in order to set a fixed exchange rate with the US dollar . New currencies were created in the French colonies to spare them the strong devaluation, thereby making it easier for them to import goods from France (and simultaneously making it harder for them to export goods to France). French officials presented the decision as an act of generosity. René Pleven ,

320-510: The Central African CFA franc (where "CFA" stands for Coopération Financière en Afrique centrale , i.e. "Financial Cooperation in Central Africa" in English), used in six Central African countries. Although separate, the two CFA franc currencies have always been at parity and are effectively interchangeable. The ISO currency codes are XAF for the Central African CFA franc and XOF for

352-636: The Dakar Biennale of Contemporary African Art on May 10. It was designed by Dr. Professor Boamh. The project was a response to the perceived lack of independence created by use of the CFA franc . Notes and coins of the imaginary currency were produced, and given away or sold to the people of Dakar and Senegal to encourage them "to reflect on the meaning (value) of money and the future of their own local currency". In 2015, Anthony Maruping stated that Kenya, Uganda, Tanzania, Rwanda and Burundi were committed to join

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384-499: The French Minister of Finance , was quoted as saying: In a show of her generosity and selflessness, metropolitan France , wishing not to impose on her far-away daughters the consequences of her own poverty, is setting different exchange rates for their currency. The CFA franc was created with a fixed exchange rate versus the French franc . This exchange rate was changed only twice, in 1948 and in 1994 (besides nominal adaptation to

416-585: The South African rand . The African Union's plans for further integration encourage the development of more such regional unions as an intermediate step to full monetary union. One proposed union is the eco , a proposed currency for members of the Economic Community of West African States (ECOWAS). In 2002, Mansour Ciss and Baruch Gottlieb created a "prototype" currency, called the AFRO, which they presented at

448-550: The West African CFA franc . Both CFA francs have a fixed exchange rate (peg) to the euro guaranteed by France: €1 = F.CFA 655.957 exactly. To ensure this convertibility guarantee, member countries were required to deposit half of their foreign exchange reserves with the French Treasury, but this requirement was dropped in 2019 (effective in 2021) for the West African CFA franc. This requirement remains unchanged for

480-673: The afro or afriq . The single African currency is to be composed of currency units made up of regional union reserve bank currency units of which are made up country specific currencies ( The Arab Maghreb Union (AMU) - Northern Afriq , Southern African Development Community (SADC) - Southern Afriq , Economic Community of West African States (ECOWAS) - Western Afriq or ECO , East African Community (EAC) - Eastern Afriq , Common Market for Eastern and Southern Africa (COMESA) - Central Afriq etc.). The Abuja Treaty, an international agreement signed on June 3, 1991, in Abuja , Nigeria , created

512-471: The euro at a later date, while the official currency of Mayotte is the euro . The African Central Bank (ACB) is one of the three financial institutions of the African Union. It will, over time, take over the responsibilities of the African Monetary Fund . The creation of the ACB, to be completed by 2028, was first agreed upon in the 1991 Abuja Treaty. The 1999 Sirte Declaration called for

544-823: The African banking industry in sync with regional banking industries and unions, and it will set the official interest and exchange rates which may or may not be in sync with regional central banks; all in conjunction with the African Government's administration. The single African currency is to be composed of currency units made up of regional central bank currency units of which are made up country specific currencies ( The Arab Maghreb Union (AMU) - Northern Afriq , Southern African Development Community (SADC) - Southern Afriq , Economic Community of West African States (ECOWAS) - Western Afriq or ECO , East African Community (EAC) , Eastern Afriq - Common Market for Eastern and Southern Africa (COMESA) - Central Afriq etc.). This African bank or banking-related article

576-659: The CFA franc since its introduction, despite the fact that they had never been French colonies. In 1998, in anticipation of Economic and Monetary Union of the European Union , the Council of the European Union addressed the monetary agreements France had with the CFA Zone and Comoros and ruled that: The currency has been criticized for making national monetary policy for the developing countries of French West Africa all but impossible, since

608-694: The CFA franc, and criticism continued from various African organizations. On 21 December 2019, President Alassane Ouattara of the Ivory Coast and President Emmanuel Macron of France announced an initiative to replace the West African CFA Franc with the Eco . Subsequently, a reform of the West African CFA franc was initiated. In May 2020, the French National Assembly agreed to end the French engagement in

640-570: The CFA franc: the West African CFA franc ( ISO 4217 currency code XOF), and the Central Africa CFA franc ( ISO 4217 currency code XAF). They are distinguished in French by the meaning of the abbreviation CFA. These two CFA francs have the same exchange rate with the euro (1 euro = 655.957 XOF = 655.957 XAF), and they are both guaranteed by the French treasury ( Trésor public ), but the two currencies are only legal tender in their respective member countries. The West African CFA franc ( XOF )

672-505: The CFA's value is pegged to the euro (whose monetary policy is set by the European Central Bank ). Others disagree and argue that the CFA "helps stabilize the national currencies of Franc Zone member-countries and greatly facilitates the flow of exports and imports between France and the member-countries". The European Union 's 2008 assessment of the CFA's link to the euro noted that "benefits from economic integration within each of

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704-482: The Central African CFA franc, which wasn't reformed in 2019 (the reform concerned only the West African CFA franc). The currency has been criticized for restricting the sovereignty of the African member states, effectively putting their monetary policy in the hands of the European Central Bank . Others argue that the CFA "helps stabilize the national currencies of Franc Zone member-countries and greatly facilitates

736-517: The UEMOA ( Union Économique et Monétaire Ouest Africaine , i.e., " West African Economic and Monetary Union "): These eight countries have a combined population of 147.6 million people (as of 2023), and a combined GDP of US$ 199.4 billion (as of 2023). The Central Africa CFA franc ( XAF ) is known in French as the Franc CFA , where CFA stands for Coopération financière en Afrique centrale ("Financial Cooperation in Central Africa"). It

768-418: The West African CFA franc. The countries using the currency will no longer have to deposit half of their foreign exchange reserves with the French Treasury. The broader Economic Community of West African States (ECOWAS), which includes the members of UEMOA, plans to introduce its own common currency for its member states by 2027, for which they have also formally adopted the name Eco . On April 25, 2023,

800-459: The beginning of the 1960s. Since independence, CFA is taken to mean Communauté Financière Africaine (African Financial Community) or Coopération financière en Afrique centrale (see Institutions below). The CFA franc was created on 26 December 1945, along with the CFP franc . The reason for their creation was the weakness of the French franc immediately after World War II . When France ratified

832-461: The flow of exports and imports between France and the member-countries". On 22 December 2019, it was announced that the West African currency would be reformed and replaced by an independent currency to be called Eco . In May 2020, the French National Assembly agreed to end the French engagement in the West African CFA franc, including the foreign reserve deposit requirements, thereby facilitating

864-616: The new French franc in 1960 and the Euro in 1999). Exchange rate: The 1960 and 1999 events merely reflect changes of currency in use in France: the actual relative value of the CFA franc versus the French franc/euro only changed in 1948 and 1994. Over time, the number of countries and territories using the CFA franc has changed as some countries began introducing their own separate currencies. A couple of nations in West Africa have also chosen to adopt

896-541: The official interest and exchange rates in conjunction with the African Government's administration. The current timeline established by the Abuja Treaty calls for a single African currency to be instituted by the African Central Bank by 2028. Although some countries have reservations about full economic and monetary union , several regional monetary unions already exist, and others are planned. Signatories to

928-537: The subject of the CFA franc was discussed at the ministerial meeting of the Economic and Monetary Community of Central Africa (CEMAC) and France. The French perceive the guarantee provided to the CFA franc, and the assurance of its convertibility, as a pillar of economic stability for the region. France remains “open” and “available” to CEMAC proposals to reform monetary cooperation in Central Africa, as has happened in West Africa. [1] There are two different currencies called

960-684: The transition to the Eco. Despite initial plans for a monetary union by late 2020, setbacks including the COVID-19 pandemic , global geopolitical uncertainties, and failure to meet criteria resulted in a postponement until 2027. CFA francs are used in fourteen countries: twelve nations formerly ruled by France in West and Central Africa (excluding Guinea and Mauritania , which withdrew), plus Guinea-Bissau (a former Portuguese colony), and Equatorial Guinea (a former Spanish colony). These fourteen countries have

992-659: The treaty were all members of the Organisation of African Unity (predecessor of the AU) at the time (Eritrea, South Africa, South Sudan and Morocco have since joined): CFA franc The CFA franc ( French : franc CFA , [fʁɑ̃ seɛfɑ] ) is the name of two currencies used by 210 million people (as of 2023) in fourteen African countries: the West African CFA franc (where "CFA" stands for Communauté Financière Africaine , i.e. "African Financial Community" in English), used in eight West African countries , and

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1024-593: The two monetary unions of the CFA franc zone, and even more so between them, remained remarkably low" but that "the peg to the French franc and, since 1999, to the euro as exchange rate anchor is usually found to have had favourable effects in the region in terms of macroeconomic stability". Critics point out that the currency is controlled by the French treasury, and in turn African countries channel more money to France than they receive in aid and have no sovereignty over their monetary policies. In January 2019, Italian ministers accused France of impoverishing Africa through

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