The CFA Franc Currency Regime as a Neo-colonial Tool for Monetary Subordination IlkkaCheema1
Abstract:
The CFA Franc currency regime is a mechanism that binds France with 14 countries in West/Central Africa. There are four inter-related principles that constitute the CFA system: (1) The fixed exchange rate (2) The free movement of capital (3) The free convertibility of the currency (4) The centralization of foreign exchange reserves (Pigeaud and Sylla, 2021). All four principles operate in tandem with the Operations Account. Advocates for the CFA franc regime have claimed that it promotes sound macroeconomic policy by maintaining price stability in a region blighted by horror cases of inflation. However, this orthodox view is disputed by many critical African scholars such as Amin, Pouemi, and Sylla. This dissertation aims to uncover the mechanisms of monetary subordination and explain how the CFA franc is able to be sustained by the French state, unimpeded.
As such, the guiding research question is: How does France continue to use the CFA franc currency regime as a neo-colonial mechanism for monetary subordination in West/Central African states?
This paper appraises the work of Pigeaud and Sylla and argues that four inherent handicaps exist in the CFA system that operate as a mechanism of monetary repression. These handicaps are: (1) An excessively rigid exchange rate (2) A problematic pegging to the euro (3) The underfinancing of African economies (4) The free movement of capital that generates massive financial bleed-out (Pigeaud and Sylla, 2021). Through empirical analysis of quantitative data, this paper shows that the four embedded handicaps of the CFA system have operated as a mechanism of monetary repression. The currency regime continues to exist due to its service to France as an anachronism of the French state at the service of the Françafrique. This paper uses historical case studies to illustrate that France has not hesitated to resort to violent tactics such as assassinations and coup d’états to maintain its grip on the CFA system. This is due to the exuberant economic and political privileges it gains from defending its interests in the franc zone which continue to serve the French political establishment and African ruling classes alike.
A post colonial examination of the cfa francKaran Khosla
A study into the Franc CFA, its emergence and continued link to the Francafrique relationship which has existed for centuries, predominantly focusing on the relationship between France and its former colonies post-independence in 1960. How does the Franc CFA affect the countries using it, their monetary policies and ability for growth. The debate over the use of the currency has returned in force in recent years, with one side defending the currency as a monetary stabilizer and conduct for economic growth, while others see it as a continued neocolonial policy maker which keeps the states controlled and unable to fully develop to the limit of their potential. If the Franc were to be kept or changed, what could be the policies used to change the relationship as it stands and look towards a different possibility for growth within the region.
Beyond commodities: Gulf investors and the new Africa is a
report by The Economist Intelligence Unit examining Sub-Saharan Africa’s growth trends outside of the natural resource
and commodities sectors, and maps the existing and potential
role of Gulf-based investors. The findings are based on desk
research and interviews with experts, conducted by The
Economist Intelligence Unit. This research was commissioned
by Dubai Chamber.
This paper i wrote as an assignment under the Thabo Mbeki Leadership Institute programme (UNISA). The paper addresses the following question: Does the linear integration model of regional integration, based on the historical experience of the European Union (EU), provides the best overall framework for advancing regional integration in Africa. Please refer to current regional integration arrangements in Africa to motivate your argument: The linear integration model of regional integration, based on the historical experience of the European Union (EU), provides the best overall framework for advancing regional integration in Africa. Reference was made to current regional integration arrangements in Africa to motivate your argument.
The CFA Franc Currency Regime as a Neo-colonial Tool for Monetary Subordination IlkkaCheema1
Abstract:
The CFA Franc currency regime is a mechanism that binds France with 14 countries in West/Central Africa. There are four inter-related principles that constitute the CFA system: (1) The fixed exchange rate (2) The free movement of capital (3) The free convertibility of the currency (4) The centralization of foreign exchange reserves (Pigeaud and Sylla, 2021). All four principles operate in tandem with the Operations Account. Advocates for the CFA franc regime have claimed that it promotes sound macroeconomic policy by maintaining price stability in a region blighted by horror cases of inflation. However, this orthodox view is disputed by many critical African scholars such as Amin, Pouemi, and Sylla. This dissertation aims to uncover the mechanisms of monetary subordination and explain how the CFA franc is able to be sustained by the French state, unimpeded.
As such, the guiding research question is: How does France continue to use the CFA franc currency regime as a neo-colonial mechanism for monetary subordination in West/Central African states?
This paper appraises the work of Pigeaud and Sylla and argues that four inherent handicaps exist in the CFA system that operate as a mechanism of monetary repression. These handicaps are: (1) An excessively rigid exchange rate (2) A problematic pegging to the euro (3) The underfinancing of African economies (4) The free movement of capital that generates massive financial bleed-out (Pigeaud and Sylla, 2021). Through empirical analysis of quantitative data, this paper shows that the four embedded handicaps of the CFA system have operated as a mechanism of monetary repression. The currency regime continues to exist due to its service to France as an anachronism of the French state at the service of the Françafrique. This paper uses historical case studies to illustrate that France has not hesitated to resort to violent tactics such as assassinations and coup d’états to maintain its grip on the CFA system. This is due to the exuberant economic and political privileges it gains from defending its interests in the franc zone which continue to serve the French political establishment and African ruling classes alike.
A post colonial examination of the cfa francKaran Khosla
A study into the Franc CFA, its emergence and continued link to the Francafrique relationship which has existed for centuries, predominantly focusing on the relationship between France and its former colonies post-independence in 1960. How does the Franc CFA affect the countries using it, their monetary policies and ability for growth. The debate over the use of the currency has returned in force in recent years, with one side defending the currency as a monetary stabilizer and conduct for economic growth, while others see it as a continued neocolonial policy maker which keeps the states controlled and unable to fully develop to the limit of their potential. If the Franc were to be kept or changed, what could be the policies used to change the relationship as it stands and look towards a different possibility for growth within the region.
Beyond commodities: Gulf investors and the new Africa is a
report by The Economist Intelligence Unit examining Sub-Saharan Africa’s growth trends outside of the natural resource
and commodities sectors, and maps the existing and potential
role of Gulf-based investors. The findings are based on desk
research and interviews with experts, conducted by The
Economist Intelligence Unit. This research was commissioned
by Dubai Chamber.
This paper i wrote as an assignment under the Thabo Mbeki Leadership Institute programme (UNISA). The paper addresses the following question: Does the linear integration model of regional integration, based on the historical experience of the European Union (EU), provides the best overall framework for advancing regional integration in Africa. Please refer to current regional integration arrangements in Africa to motivate your argument: The linear integration model of regional integration, based on the historical experience of the European Union (EU), provides the best overall framework for advancing regional integration in Africa. Reference was made to current regional integration arrangements in Africa to motivate your argument.
This paper deals with the analysis of the GDP growth in the CEMAC countries, which are Chad, the
Central African Republic, Congo, Gabon and Cameroon and Equatorial Guinea. We use time series techniques
based on the concept of fractional integration and cointegration. The univariate analysis based on fractional
integration aims to determine whether the series are I(1) or alternatively I(d) with d<1, which would imply
mean reversion.
Africa is making the right choices for itself, even though some of these may not be well strategized or well planned. Africa need to avoid repeating mistakes, and to prepare for the coming years with a vision and agenda that will make sure Africans claim their share of the global fortunes in near future.
Illicit financial flows main report englishZELA_infor
This Report reflects the work that the High Level Panel on Illicit Financial Flows
has carried out since it was established in February 2012, particularly to:
> Develop a realistic and accurate assessment of the volumes and
sources of these outflows;
> Gain concrete understanding of how these outflows occur in Africa,
based on case studies of a sample of African countries and;
> Ensure that they make specific recommendations of practical, realistic,
short- to medium-term actions that should be taken both by Africa and
by the rest of the world to effectively confront what is in fact a global
challenge.
This Report reflects the work that the High Level Panel on Illicit Financial Flows
has carried out since it was established in February 2012, particularly to:
> Develop a realistic and accurate assessment of the volumes and
sources of these outflows;
> Gain concrete understanding of how these outflows occur in Africa,
based on case studies of a sample of African countries and;
> Ensure that they make specific recommendations of practical, realistic,
short- to medium-term actions that should be taken both by Africa and
by the rest of the world to effectively confront what is in fact a global
challenge.
16.8289277 Journal of xian shiyou university Opue et al.pdfJobOpue1
This work provides an answer to the possibility of creating a second West African monetary union in West Africa. The business cycles in the West African Monetary Zone (WAMZ) using real GDP growth within 1980-2022, detrended by Hodrick–Prescott filters were analyzed. This work also examined the effect of the level of symmetry in macroeconomic policies and the level of symmetry in trade flows on the level of synchronization of business cycles between pairs of countries in WAMZ, the seemingly unrelated regression estimation was computed on Autoregressive Distributed Lag models. The cusum of squares test indicated the absence of structural breaks in the models while the system Portmanteau test for autocorrelation indicated the absence of serial correlations up to the 10th order lag. The empirical results provide clear support for Ghana, Guinea and Nigeria to proceed in the creation of the second West African monetary union with their various currencies tied to the WAMZ-eco while also creating an enabling environment for other countries within WAMZ to join in due course. The cyclical thrift scheme for ECOWAS countries to boost industrialization and trade protection/restriction was also recommended
TRADE FLOWS, OPTIMAL MACROECONOMIC POLICY AND BUSINESS CYCLES SYNCHRONIZATION...JobOpue1
This work provides an answer to the possibility of creating a second West African monetary union in West Africa. The business cycles in the West African Monetary Zone (WAMZ) using real GDP growth within 1980-2022, detrended by Hodrick–Prescott filters were analyzed. This work also examined the effect of the level of symmetry in macroeconomic policies and the level of symmetry in trade flows on the level of synchronization of business cycles between pairs of countries in WAMZ, the seemingly unrelated regression estimation was computed on Autoregressive Distributed Lag models. The cusum of squares test indicated the absence of structural breaks in the models while the system Portmanteau test for autocorrelation indicated the absence of serial correlations up to the 10th order lag. The empirical results provide clear support for Ghana, Guinea and Nigeria to proceed in the creation of the second West African monetary union with their various currencies tied to the WAMZ-eco while also creating an enabling environment for other countries within WAMZ to join in due course. The cyclical thrift scheme for ECOWAS countries to boost industrialization and trade protection/restriction was also recommended.
Will EPAs foster dynamism or kick away the ladder?
WTO Public Forum
Kenya Human Rights Commission Session
Isabelle Ramdoo,
Deputy Head,
Economic Transformation and Trade Programme
1st October, 2014
Geneva, Switzerland
This paper deals with the analysis of the GDP growth in the CEMAC countries, which are Chad, the
Central African Republic, Congo, Gabon and Cameroon and Equatorial Guinea. We use time series techniques
based on the concept of fractional integration and cointegration. The univariate analysis based on fractional
integration aims to determine whether the series are I(1) or alternatively I(d) with d<1, which would imply
mean reversion.
Africa is making the right choices for itself, even though some of these may not be well strategized or well planned. Africa need to avoid repeating mistakes, and to prepare for the coming years with a vision and agenda that will make sure Africans claim their share of the global fortunes in near future.
Illicit financial flows main report englishZELA_infor
This Report reflects the work that the High Level Panel on Illicit Financial Flows
has carried out since it was established in February 2012, particularly to:
> Develop a realistic and accurate assessment of the volumes and
sources of these outflows;
> Gain concrete understanding of how these outflows occur in Africa,
based on case studies of a sample of African countries and;
> Ensure that they make specific recommendations of practical, realistic,
short- to medium-term actions that should be taken both by Africa and
by the rest of the world to effectively confront what is in fact a global
challenge.
This Report reflects the work that the High Level Panel on Illicit Financial Flows
has carried out since it was established in February 2012, particularly to:
> Develop a realistic and accurate assessment of the volumes and
sources of these outflows;
> Gain concrete understanding of how these outflows occur in Africa,
based on case studies of a sample of African countries and;
> Ensure that they make specific recommendations of practical, realistic,
short- to medium-term actions that should be taken both by Africa and
by the rest of the world to effectively confront what is in fact a global
challenge.
16.8289277 Journal of xian shiyou university Opue et al.pdfJobOpue1
This work provides an answer to the possibility of creating a second West African monetary union in West Africa. The business cycles in the West African Monetary Zone (WAMZ) using real GDP growth within 1980-2022, detrended by Hodrick–Prescott filters were analyzed. This work also examined the effect of the level of symmetry in macroeconomic policies and the level of symmetry in trade flows on the level of synchronization of business cycles between pairs of countries in WAMZ, the seemingly unrelated regression estimation was computed on Autoregressive Distributed Lag models. The cusum of squares test indicated the absence of structural breaks in the models while the system Portmanteau test for autocorrelation indicated the absence of serial correlations up to the 10th order lag. The empirical results provide clear support for Ghana, Guinea and Nigeria to proceed in the creation of the second West African monetary union with their various currencies tied to the WAMZ-eco while also creating an enabling environment for other countries within WAMZ to join in due course. The cyclical thrift scheme for ECOWAS countries to boost industrialization and trade protection/restriction was also recommended
TRADE FLOWS, OPTIMAL MACROECONOMIC POLICY AND BUSINESS CYCLES SYNCHRONIZATION...JobOpue1
This work provides an answer to the possibility of creating a second West African monetary union in West Africa. The business cycles in the West African Monetary Zone (WAMZ) using real GDP growth within 1980-2022, detrended by Hodrick–Prescott filters were analyzed. This work also examined the effect of the level of symmetry in macroeconomic policies and the level of symmetry in trade flows on the level of synchronization of business cycles between pairs of countries in WAMZ, the seemingly unrelated regression estimation was computed on Autoregressive Distributed Lag models. The cusum of squares test indicated the absence of structural breaks in the models while the system Portmanteau test for autocorrelation indicated the absence of serial correlations up to the 10th order lag. The empirical results provide clear support for Ghana, Guinea and Nigeria to proceed in the creation of the second West African monetary union with their various currencies tied to the WAMZ-eco while also creating an enabling environment for other countries within WAMZ to join in due course. The cyclical thrift scheme for ECOWAS countries to boost industrialization and trade protection/restriction was also recommended.
Will EPAs foster dynamism or kick away the ladder?
WTO Public Forum
Kenya Human Rights Commission Session
Isabelle Ramdoo,
Deputy Head,
Economic Transformation and Trade Programme
1st October, 2014
Geneva, Switzerland
L’épidémie frappe le continent africain à un moment où il est particulièrement vulnérable. Les conséquences sanitaires et économiques risquent d'être dramatiques.
La coopération de la France avec l’Afrique se distingue par l’appui qu’elle déploie dans deux domaines régaliens : la défense, d’une part, et la monnaie, de l’autre. ...
La coopération de la France avec l’Afrique se distingue par l’appui qu’elle déploie dans deux domaines régaliens : la défense, d’une part, et la monnaie, de l’autre ...
If you are looking for a pi coin investor. Then look no further because I have the right one he is a pi vendor (he buy and resell to whales in China). I met him on a crypto conference and ever since I and my friends have sold more than 10k pi coins to him And he bought all and still want more. I will drop his telegram handle below just send him a message.
@Pi_vendor_247
Empowering the Unbanked: The Vital Role of NBFCs in Promoting Financial Inclu...Vighnesh Shashtri
In India, financial inclusion remains a critical challenge, with a significant portion of the population still unbanked. Non-Banking Financial Companies (NBFCs) have emerged as key players in bridging this gap by providing financial services to those often overlooked by traditional banking institutions. This article delves into how NBFCs are fostering financial inclusion and empowering the unbanked.
when will pi network coin be available on crypto exchange.DOT TECH
There is no set date for when Pi coins will enter the market.
However, the developers are working hard to get them released as soon as possible.
Once they are available, users will be able to exchange other cryptocurrencies for Pi coins on designated exchanges.
But for now the only way to sell your pi coins is through verified pi vendor.
Here is the telegram contact of my personal pi vendor
@Pi_vendor_247
The Evolution of Non-Banking Financial Companies (NBFCs) in India: Challenges...beulahfernandes8
Role in Financial System
NBFCs are critical in bridging the financial inclusion gap.
They provide specialized financial services that cater to segments often neglected by traditional banks.
Economic Impact
NBFCs contribute significantly to India's GDP.
They support sectors like micro, small, and medium enterprises (MSMEs), housing finance, and personal loans.
Turin Startup Ecosystem 2024 - Ricerca sulle Startup e il Sistema dell'Innov...Quotidiano Piemontese
Turin Startup Ecosystem 2024
Una ricerca de il Club degli Investitori, in collaborazione con ToTeM Torino Tech Map e con il supporto della ESCP Business School e di Growth Capital
US Economic Outlook - Being Decided - M Capital Group August 2021.pdfpchutichetpong
The U.S. economy is continuing its impressive recovery from the COVID-19 pandemic and not slowing down despite re-occurring bumps. The U.S. savings rate reached its highest ever recorded level at 34% in April 2020 and Americans seem ready to spend. The sectors that had been hurt the most by the pandemic specifically reduced consumer spending, like retail, leisure, hospitality, and travel, are now experiencing massive growth in revenue and job openings.
Could this growth lead to a “Roaring Twenties”? As quickly as the U.S. economy contracted, experiencing a 9.1% drop in economic output relative to the business cycle in Q2 2020, the largest in recorded history, it has rebounded beyond expectations. This surprising growth seems to be fueled by the U.S. government’s aggressive fiscal and monetary policies, and an increase in consumer spending as mobility restrictions are lifted. Unemployment rates between June 2020 and June 2021 decreased by 5.2%, while the demand for labor is increasing, coupled with increasing wages to incentivize Americans to rejoin the labor force. Schools and businesses are expected to fully reopen soon. In parallel, vaccination rates across the country and the world continue to rise, with full vaccination rates of 50% and 14.8% respectively.
However, it is not completely smooth sailing from here. According to M Capital Group, the main risks that threaten the continued growth of the U.S. economy are inflation, unsettled trade relations, and another wave of Covid-19 mutations that could shut down the world again. Have we learned from the past year of COVID-19 and adapted our economy accordingly?
“In order for the U.S. economy to continue growing, whether there is another wave or not, the U.S. needs to focus on diversifying supply chains, supporting business investment, and maintaining consumer spending,” says Grace Feeley, a research analyst at M Capital Group.
While the economic indicators are positive, the risks are coming closer to manifesting and threatening such growth. The new variants spreading throughout the world, Delta, Lambda, and Gamma, are vaccine-resistant and muddy the predictions made about the economy and health of the country. These variants bring back the feeling of uncertainty that has wreaked havoc not only on the stock market but the mindset of people around the world. MCG provides unique insight on how to mitigate these risks to possibly ensure a bright economic future.
BYD SWOT Analysis and In-Depth Insights 2024.pptxmikemetalprod
Indepth analysis of the BYD 2024
BYD (Build Your Dreams) is a Chinese automaker and battery manufacturer that has snowballed over the past two decades to become a significant player in electric vehicles and global clean energy technology.
This SWOT analysis examines BYD's strengths, weaknesses, opportunities, and threats as it competes in the fast-changing automotive and energy storage industries.
Founded in 1995 and headquartered in Shenzhen, BYD started as a battery company before expanding into automobiles in the early 2000s.
Initially manufacturing gasoline-powered vehicles, BYD focused on plug-in hybrid and fully electric vehicles, leveraging its expertise in battery technology.
Today, BYD is the world’s largest electric vehicle manufacturer, delivering over 1.2 million electric cars globally. The company also produces electric buses, trucks, forklifts, and rail transit.
On the energy side, BYD is a major supplier of rechargeable batteries for cell phones, laptops, electric vehicles, and energy storage systems.
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
Poonawalla Fincorp and IndusInd Bank Introduce New Co-Branded Credit Cardnickysharmasucks
The unveiling of the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card marks a notable milestone in the Indian financial landscape, showcasing a successful partnership between two leading institutions, Poonawalla Fincorp and IndusInd Bank. This co-branded credit card not only offers users a plethora of benefits but also reflects a commitment to innovation and adaptation. With a focus on providing value-driven and customer-centric solutions, this launch represents more than just a new product—it signifies a step towards redefining the banking experience for millions. Promising convenience, rewards, and a touch of luxury in everyday financial transactions, this collaboration aims to cater to the evolving needs of customers and set new standards in the industry.
The European Unemployment Puzzle: implications from population agingGRAPE
We study the link between the evolving age structure of the working population and unemployment. We build a large new Keynesian OLG model with a realistic age structure, labor market frictions, sticky prices, and aggregate shocks. Once calibrated to the European economy, we quantify the extent to which demographic changes over the last three decades have contributed to the decline of the unemployment rate. Our findings yield important implications for the future evolution of unemployment given the anticipated further aging of the working population in Europe. We also quantify the implications for optimal monetary policy: lowering inflation volatility becomes less costly in terms of GDP and unemployment volatility, which hints that optimal monetary policy may be more hawkish in an aging society. Finally, our results also propose a partial reversal of the European-US unemployment puzzle due to the fact that the share of young workers is expected to remain robust in the US.
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
Financial Assets: Debit vs Equity Securities.pptxWrito-Finance
financial assets represent claim for future benefit or cash. Financial assets are formed by establishing contracts between participants. These financial assets are used for collection of huge amounts of money for business purposes.
Two major Types: Debt Securities and Equity Securities.
Debt Securities are Also known as fixed-income securities or instruments. The type of assets is formed by establishing contracts between investor and issuer of the asset.
• The first type of Debit securities is BONDS. Bonds are issued by corporations and government (both local and national government).
• The second important type of Debit security is NOTES. Apart from similarities associated with notes and bonds, notes have shorter term maturity.
• The 3rd important type of Debit security is TRESURY BILLS. These securities have short-term ranging from three months, six months, and one year. Issuer of such securities are governments.
• Above discussed debit securities are mostly issued by governments and corporations. CERTIFICATE OF DEPOSITS CDs are issued by Banks and Financial Institutions. Risk factor associated with CDs gets reduced when issued by reputable institutions or Banks.
Following are the risk attached with debt securities: Credit risk, interest rate risk and currency risk
There are no fixed maturity dates in such securities, and asset’s value is determined by company’s performance. There are two major types of equity securities: common stock and preferred stock.
Common Stock: These are simple equity securities and bear no complexities which the preferred stock bears. Holders of such securities or instrument have the voting rights when it comes to select the company’s board of director or the business decisions to be made.
Preferred Stock: Preferred stocks are sometime referred to as hybrid securities, because it contains elements of both debit security and equity security. Preferred stock confers ownership rights to security holder that is why it is equity instrument
<a href="https://www.writofinance.com/equity-securities-features-types-risk/" >Equity securities </a> as a whole is used for capital funding for companies. Companies have multiple expenses to cover. Potential growth of company is required in competitive market. So, these securities are used for capital generation, and then uses it for company’s growth.
Concluding remarks
Both are employed in business. Businesses are often established through debit securities, then what is the need for equity securities. Companies have to cover multiple expenses and expansion of business. They can also use equity instruments for repayment of debits. So, there are multiple uses for securities. As an investor, you need tools for analysis. Investment decisions are made by carefully analyzing the market. For better analysis of the stock market, investors often employ financial analysis of companies.
what is the future of Pi Network currency.DOT TECH
The future of the Pi cryptocurrency is uncertain, and its success will depend on several factors. Pi is a relatively new cryptocurrency that aims to be user-friendly and accessible to a wide audience. Here are a few key considerations for its future:
Message: @Pi_vendor_247 on telegram if u want to sell PI COINS.
1. Mainnet Launch: As of my last knowledge update in January 2022, Pi was still in the testnet phase. Its success will depend on a successful transition to a mainnet, where actual transactions can take place.
2. User Adoption: Pi's success will be closely tied to user adoption. The more users who join the network and actively participate, the stronger the ecosystem can become.
3. Utility and Use Cases: For a cryptocurrency to thrive, it must offer utility and practical use cases. The Pi team has talked about various applications, including peer-to-peer transactions, smart contracts, and more. The development and implementation of these features will be essential.
4. Regulatory Environment: The regulatory environment for cryptocurrencies is evolving globally. How Pi navigates and complies with regulations in various jurisdictions will significantly impact its future.
5. Technology Development: The Pi network must continue to develop and improve its technology, security, and scalability to compete with established cryptocurrencies.
6. Community Engagement: The Pi community plays a critical role in its future. Engaged users can help build trust and grow the network.
7. Monetization and Sustainability: The Pi team's monetization strategy, such as fees, partnerships, or other revenue sources, will affect its long-term sustainability.
It's essential to approach Pi or any new cryptocurrency with caution and conduct due diligence. Cryptocurrency investments involve risks, and potential rewards can be uncertain. The success and future of Pi will depend on the collective efforts of its team, community, and the broader cryptocurrency market dynamics. It's advisable to stay updated on Pi's development and follow any updates from the official Pi Network website or announcements from the team.
Webinar Exploring DORA for Fintechs - Simont Braun
Summary: the future of the Franc Zone in Africa
1. FRANC ZONE, FOR AN EMANCIPATION BENEFITTING ALL1
(APRIL 2018)
SUMMARY
France’s cooperation with Africa stands out because of the support it provides touching
on two core state powers: defense and currency. This type of support is appreciated south of
the Sahara, because the States there are still relatively young politically and often face threats.
Defense and currency involve areas of sovereignty. Consequently, any hint of
neocolonialism must be dispelled. In the area of defense, since the end of the Cold War,
diplomats and military personnel took special care to empower local stakeholders and to ensure
that any French actions took place under a transparent framework, validated by the international
community.
Monetary affairs are not handled in the same way: the franc zone remains a taboo subject. In
addition to the fear, sometimes justified, of speculation against the CFA franc, there is the
questionable premise that criticism of the terms and conditions of the cooperation amounts to
attacking the underlying principle itself. It must be accepted or rejected lock, stock and barrel.
Any debate is therefore limited to a discussion of its simplest elements.
A step forward occurred in 2017. During the summer, the franc zone was the focus of public
protests involving civil society and African experts in particular. In the fall, the president of the
French Republic stated in public that he was open to any reform proposals made by African
officials. At the same time, discussions on the economic and monetary integration of the African
continent gained momentum, particularly in West Africa.
To allow this development to bear fruit, two temptations must be resisted.
The first would be an overhaul of the franc zone that is limited to symbols. Of course, the
latter are more or less indefensible, starting with the name of the CFA franc itself. The franc is
a French currency that even France has abandoned. The CFA acronym stands for… “French
Colonies of Africa” (a term later replaced, even if the French acronym remained unchanged,
with “African Financial Community” in West Africa and “Financial Cooperation in Africa” in
Central Africa).
But settling for a reform of only symbols would be a terrible waste of an opportunity given the
challenges that await the zone. Major economic and social changes lie ahead over the next few
1 I want to thank Dominique Bocquet for all the comments and advise he gave me while this text has been prepared.
His technical skill as well as his intimate knowledge of the African reality have been of invaluable help. As usual, the
opinions in the paper remain mine.
2. 2
decades: the population in Africa will double by 2050, there will be widespread urbanization,
bringing with it massive population movements, and its integration into international trade will
be transformed. Its colonial heritage and the divide between French-speaking and English-
speaking Africa will no longer be relevant as economic lines of separation (even if they persist
as cultural realities). Monetary cooperation must be reformed to take on these challenges.
The second error would be to mistake these transformations for a challenge to the
principle of stable exchange rates, which is still understandably favored in the countries
concerned.
Today, the economic debate quite rightly gives stable exchange rates their proper due,
particularly with regard to the currencies in the developing countries, often the victim of
speculation. But there is in fact a wide range of options possible within the principle of stable
exchange rates.
It is from this perspective that the present study aims to discuss the mechanisms of the franc
zone in detail and to pinpoint the necessary changes to be made.
It identifies four issues that are key to any reform.
- Decision-making rules must be aligned to be consistent with the exchange rate regime
that is supposed to characterize the zone. The regime consists of stable, but adjustable,
exchange rates. It can work well in Africa as long as there is an external guarantee to act as a
lightning rod against speculation. But it should not be confused with an absolute inflexibility,
preventing any changes even when exceptional circumstances arise. Yet, practically speaking,
this is the current situation arising from the decision-making rules in place, inherited from the
past.
- Convergence mechanisms must be strengthened. The franc zone is made up of African
monetary unions (WAEMU and CEMAC) which, much like in the euro zone, consist of national
States that hold the non-monetary instruments of economic policy (in particular, fiscal policy).
Under such a configuration, economic convergence is vital to guarantee the success of monetary
union. This aspect is always initially underestimated on all continents. Despite genuine efforts,
particularly in West Africa, convergence mechanisms suffer from deficiencies specific to the
franc zone, both within the monetary unions and in the organization of their relations with
France. This leads to a lose-lose situation. For the guarantor country, this results in a poorly
controlled financial risk (and expected to grow over time); for the African side, it creates a
recurring dependency on the guarantor
- Following the traces of the past, the perimeter of the franc zone must adapt to current
economic realities. Despite the membership of Equatorial Guinea in CEMAC and of Guinea-
Bissau in WAEMU, the borders still follow the divisions inherited from colonization, especially
those associated with French-speaking Africa and English-speaking Africa. This is evident in
the case of Ghana, which is practically an enclave in the franc zone but divided from its
neighbors by currency, even though it is the first economy in the neighboring area. An
enlargement aimed at changing this would represent an historic event. But this will be
impossible to achieve as long as the two prerequisites mentioned above have not been
addressed.
3. 3
- Monetary cooperation must bring with it a greater opening up of the world to the
countries involved. Financial stability, control of inflation and a link with a major international
currency are all advantages enjoyed by the African monetary union that should receive more
recognition from the European Union and the rest of the world. And yet, the coordination and
relations organized around monetary cooperation are strictly limited to France. It is normal to
have a specific institutional link established between the guarantor country and its African
partners. Yet, it is a shame that there is no organized relationship between the latter and the
European Central Bank, on one hand, and between the countries in the euro zone, on the other
hand.
It is the ECB (and not the French Treasury or Banque de France) that sets the rates that make
up a kind of floor rate for African interest rates in the franc zone. Similarly, the advantages to
businesses provided by the stability of the CFA-euro exchange rate is not limited to French
companies: it also benefits, equally, all companies in the euro zone. Forgoing the chance for
better support from the other European countries for the franc zone represents another lost
opportunity.
Incidentally – and contrary to a widespread belief-, what governs exchange rate agreements
falls within the jurisdiction of the European Union and not that of its Member States (regardless
of their commitment to financial cooperation with Africa).
*
* *
Based on these observations, this study sets forth a series of guidelines and proposals for the
future.
The name of the currency, the location for printing banknotes and the practical terms of the
guarantee are issues involving identity. A consensus can easily emerge for a fresh start with
respect to these aspects that can be chosen by the African side.
But going further, an overhaul of the franc zone is essential to prepare it for the upcoming
economic and demographic prospects facing the continent: modify the decision-making rules
to allow for a collective African sovereignty, establish an effective convergence, put together
the basis for an endogenous and sound monetary policy, relaunch regional integration, open up
the monetary cooperation to new contacts and partners and, lastly, use enlargement and the
modernization of this mechanism as a lever for mobilizing the international community and
private investors to support Africa.
It is only by reforming this cooperation, the only one of its kind in the world, that we can use
its achievements to further the development of Africa.