Considered a well-known critic of the CFA franc, Kako Nubukpo, Togo’s former Minister of Public Policy and Policy Evaluation, also co-writer of the book “Getting Africa out of Currency Servitude: Who benefits from the CFA Franc,” explains why African countries need to scrap this old colonial currency.
You are one of the first Africans to disapprove of the CFA franc, why?
I was an executive at the Central Bank between 2000 and 2003, so I had to evaluate the impacts of the direct interest rates of the Central Bank of West African States (BCEAO) on economic growth within the UEMOA Zone and I realized that there was no impact. So I wondered why the monetary instruments we had at the Central Bank were not operational.
The main objective of the Central Bank is to maintain the exchange rates between the euro and the CFA franc. While for me the objective of a monetary policy should consist in funding the real economy. I think BCEAO should be more concerned with growth and job creation. The CFA franc system does not deal enough with the financing of the economy of member countries in the long term.
In your opinion, what should France do sort this out?
France’s role is to support the economies of the CFA franc Zone, improve the financing of its small and medium-sized enterprises (SMEs). It should also ensure low interest rates for loans, just like in Paris where you can borrow with an interest rate of less than 1 percent.
Some African countries have their own currency, but their economic situation is no better than those of the franc zone. Do you agree?
Those countries that manage their own currency are in a learning process, they have poor management skilld as od now, but they will be able to better handle their currency, unlike the other countries supported by France. African leaders have a real responsibility in the actual management of our economies. This is what will give credibility to our currency. The counterpart of sovereignty is good governance and credibility. The responsibility of African leaders and elites is engaged.
What do you recommend for countries that want to leave the CFA franc Zone? Is the project of creating the Eco as ECOWAS’s single currency the solution?
The Eco currency is a very good initiative. It will strengthen the integration of the Economic Community of West African States (ECOWAS). The points that seem important to me are fiscal solidarity and our vision of integration, which entails the massive creation of jobs that must be at the heart of our regional integration. Likewise, we need to involve people in the management of the currency.
How should people be associated in the management of the currency?
Our banks need to report to us, because, for example, when you go to Nigeria, the Governor of the Central Bank make reports every week. What are the objectives of monetary policy, what are its difficulties and what are its challenges? Our governors must answer these questions before our MPs to better associate the populations.
OKF/cd/Los/fss/abj/APA