The Cfa Franc Zone: Currency Union and Monetary Standard

60 Pages Posted: 15 Feb 2006

See all articles by James M. Boughton

James M. Boughton

International Monetary Fund (IMF) - Policy Development and Review Department; National Bureau of Economic Research (NBER)

Date Written: December 1991

Abstract

The CFA franc zone comprises a group of countries in central and west Africa whose currencies have been firmly linked to the French franc since 1948. It combines the features of a currency union with those of an exchange rate peg, and an analysis of its effectiveness must examine both dimensions. Viewed from the perspective of a currency union among the African countries, it would appear that the zone would not constitute an optimum currency area. But when France is viewed as an integral part of the system, the benefits--including discipline, credibility, and stability in international competitiveness--become clearer.

JEL Classification: E42, F33, N20

Suggested Citation

Boughton, James, The Cfa Franc Zone: Currency Union and Monetary Standard (December 1991). IMF Working Paper No. 91/133, Available at SSRN: https://ssrn.com/abstract=885173

James Boughton (Contact Author)

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