The decision of Burkina Faso, Mali, and Niger to leave the Economic Community of West African States (ECOWAS) could be seen as a strong signal to the West African Economic and Monetary Union (WAEMU) and the West African Communauté Financiere Africaine (CFA) franc, akin to the saying “kill the chicken to frighten the monkey.” This departure is a significant signal that might have broader implications for the regional economic and monetary union.
On September 16, 2023, Burkina Faso, Mali, and Niger made a bold move by establishing the Alliance des États du Sahel (AES, English: Alliance of Sahel States), a security defence pact forged in response to the threat of ECOWAS military intervention in Niger. This military cooperation emerged following the detainment of Niger’s democratically elected president, Mohamed Bazoum, by the military junta led by Abdourahamane Tchiani. The ensuing economic sanctions from both ECOWAS and WAEMU have intensified the geopolitical landscape, prompting the AES to announce their immediate departure from ECOWAS on January 28, 2024. The ECOWAS bank is shaken by the withdrawal of the three juntas.
Reasons for Departure
The AES, comprising militaries with strong Francophobia and revolutionary ambitions, contends that ECOWAS ‘has moved away from the ideals of its founding fathers and Pan-Africanism’. On January 9, 2022, ECOWAS imposed harsh sanctions on Mali due to the transitional government’s decision to extend elections until 2026, breaching the initially pledged 18-month transition period after the August 2020 coup. Then, in early August 2023, ECOWAS heightened sanctions on the military junta in Niger following a coup, issuing a warning of military intervention. The sanctions, including the suspension of commercial and financial transactions, freeze of assets, and withdrawal of ambassadors, have inflicted severe hardships on these nations already grappling with internal instability and terrorism. This strict approach aimed to prevent a domino effect of military coups in a region prone to such incidents since 2020.
The AES exhibits more commonalities with WAEMU than with ECOWAS. The eight states (Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, Senegal, and Togo) use the same currency, the CFA franc, regulated by the Central Bank of West African States (BCEAO), and French as a common language, both influenced by their colonial history with France. To intensify pressure on the military juntas, WAEMU states took the drastic measure of cutting off Mali and Niger’s access to BCEAO accounts, resulting in financial crises and debt defaults. The sanctions have had adverse effects on the regime, with the population bearing the brunt, as evident in the case of Niger. In response to the sanctions, the AES decided to cut ties with ECOWAS, asserting that the regional organisation, founded by pan-Africanists in 1975, no longer adheres to its initial principles.
Fading France’s influence
The AES accuses ECOWAS of succumbing to foreign influence, betraying its founding principles, and becoming a threat to its member states. Though France is not explicitly mentioned, the juntas consistently condemn Paris’s interventions and colonial attitudes, particularly targeting the institutional arrangements of the CFA franc. The AES claims that the CFA franc serves as an instrument of France’s economic statecraft and colonialism. The economic sanctions imposed by regional organisations are believed to be influenced by the French government and its like-minded Western states.
Claims for deep reforms or the demise of the CFA franc date back to the 1960s, following African states’ independence. Since its establishment in 1945, the CFA franc has demonstrated resilience as France strategically adapted the currency to address challenges. Pressure from African agencies and Pan-Africanist movements advocating for reduced French influence led to 2019 reforms, rebranding the currency as ‘eco,’ removing the reserve maintenance requirement in the French treasury, and withdrawing French representatives from UEMOA decision-making bodies. Despite these changes, the CFA franc remains pegged to the euro, and the French treasury ensures unlimited convertibility while monitoring reserves daily.
In December 2023, France withdrew its military from Niger, the last of its military allies in the region, following the lead of Burkina Faso and Mali—a demand echoed after coups in 2020-2022. Despite initial resistance by President Emmanuel Macron, partly due to logistical difficulties, 1,500 troops left Niger, symbolising the final military episode in the separation between Paris and the military regimes of Ouagadougou, Bamako, and Niamey. The ruling generals have severed ties with several Western partners and aligned themselves more closely with non-Western powers, including Russia, China, and Iran.
Impacts on WAEMU and CFA Franc
On November 25, 2023, the Finance and Economic Ministers of Burkina Faso, Mali, and Niger collectively declared their intentions to establish a stabilisation fund, create an investment bank, and progress towards a true economic and monetary union. This move by the AES indicates a pursuit of alternatives to the WAEMU. Do Burkina Faso, Mali, and Niger possess the requisite willingness and determination to separate from UEMOA and the CFA franc? The answer is affirmative; it is indeed possible. However, establishing new institutions would be challenging, given the alliance’s limited technological and technical infrastructure for currency production. Additionally, significant challenges arise from differences in development, fiscal systems, and economic structures among the three states. If they exit the CFA franc, these countries may follow the pattern of many other African nations by producing their currencies abroad.
Their exit from WAEMU and the CFA franc is poised to exert a more significant influence on regional institutions than on ECOWAS, given that the AES constitutes over 30% of the WAEMU GDP. These states boast substantial resource deposits, with Niger ranking as the 7th largest global producer of uranium, Burkina Faso holding the position of the third-largest cotton producer in Africa in 2020, and collectively producing around 70% of the region’s gold in 2022.
While their departure may strain the CFA franc, a collapse of the monetary system and WAEMU is less likely to happen in the next years as Côte d’Ivoire alone represents 40% of the region’s GDP. If they do decide to leave, they still need to establish credibility with public opinion and international investors, especially in a region marked by inadequate governance and weak economic and political institutions. Moreover, the AES will lose the advantages provided by the WAEMU, and more importantly, the guarantee of the unlimited convertibility of the CFA franc assured by the French treasury.
In conclusion, the departure of the AES from ECOWAS strongly signals the resolute determination of these states to retain power and pursue their agendas. Their exit from ECOWAS may compel WAEMU states to reconsider their economic sanctions, prompting a reassessment of their strategy to explore alternative approaches that could curb the subversive actions of these three member states.