Thesis Chapters by Lorenzo Saviane
A LEGAL STUDY OF ECONOMIC AND MONETARY UNIONS: A COMPARISON BETWEEN THE EUROZONE AND THE WEST AND CENTRAL AFRICAN EXPERIENCES - Lorenzo Saviane, 2022
The recent history of the European continent and that of the African one
are interconnected. This... more The recent history of the European continent and that of the African one
are interconnected. This cannot be considered exclusively a consequence of the
developments of globalisation, since even the current relationship between the
European States and the West and Central African States has roots in the
colonial period. The specific aim of this study is to analyse the development of
this relationship through a comparison between the economic and monetary
unions that have been established in both areas. Indeed, this relationship has
radically evolved over time, from the colonial domination to a more complex
monetary relationship which nowadays connects the West and Central African
currencies to the European one. Therefore, the present analysis is focused on
the legal framework of the economic and monetary unions established in Europe,
West Africa and Central Africa, which are connected not only by a historical point
of view, but also by legal provisions.
When the aggressive colonisation of Africa by the European Countries
came to an end after the second world conflict, France was able to maintain a
strong relationship with the Countries where it had extended its dominance since
the XIX century. The African territory comprised in the franc zone extended from
the area of current Senegal on the West to the heart of the continent in the area
of the current Central African Republic. The franc zone has evolved over time
and now includes a total of fifteen African States. Nonetheless, the franc zone
itself is not represented in any single institution. Instead, the franc zone is
composed of three different regional groupings: the West African Economic and
Monetary Union (WAEMU), the Economic and Monetary Community of Central
Africa (CEMAC) and the Union of the Comoros. What all these regional groupings
share with France is a currency, that is, the CFA franc. Indeed, the CFA franc
was first established by France, that made it the legal tender in each regional
grouping. Its characteristics are unique, but similar, in each grouping and France
controls the currency through a set of agreements signed with each grouping.
Through these arrangements France de facto exercises its monetary sovereignty
over the franc zone Countries. The actual advantages and disadvantages of the
CFA franc system have become a source of debate in recent times and different
economic analyses show different results. Anyway, one thing cannot be changed,
that is, the history of the franc zone Countries and of their relationship with
France. Therefore, the historical analysis is greatly relevant to the present study
because only looking at the past relationship between the franc zone Countries
and France first, and the European Union (EU) then, the current issues of the
CFA franc system can be understood.
Nevertheless, to understand the functioning of the monetary and economic
unions of the franc zone the study of the European Economic and Monetary
Union is preliminary. This, not only because the history of France is strictly
connected with the birth and development of the European Union itself, but also
because the legal framework of the economic and monetary unions of the franc
zone, at a closer look, faithfully resembles that of the EU, which shows the
9
closeness of these regimes. Therefore, an analysis of the institutional and legal
framework of the European Economic and Monetary Union is necessary to the
study of the institutional and legal framework of the WAEMU, the CEMAC and
the Union of the Comoros.
In the first chapter the concept of money is introduced, which is
fundamental for the purposes of this study. Indeed, there are multiples general
theories on the concept of money; similarly, there is no single legal theory on it.
The legal concept of money is further analysed as a specific arm of the
sovereignty exercised by States under international law. Indeed, the analysis will
try to answer the questions relating to the scope of the sovereignty of States, thus
of its internal and external boundaries. The first chapter concludes with the
analysis of the two monetary frameworks object of this study: the European Union
and the franc zone. A first section, concerning the Euro, describes its main
attributes as a single currency and legal tender for nineteen of the current twenty-
seven EU Member States. The second section, instead, focuses on the CFA
franc, the single currency and legal tender of the Member Countries of the franc
zone. Both sections adopt the perspective of the erosion of the concept of State
sovereignty, as the EU and African experiences represent two different models
of alienation of monetary sovereignty to a third entity.
The second and third chapters introduce the study of the abovementioned
economic and monetary unions. The second chapter is focused on the European
Economic and Monetary Union, while the third chapter is focused on the West
and Central African context, with an analysis of the economic and monetary
unions that are part of the franc zone: the WAEMU, the CEMAC and the Union
of the Comoros.
The second chapter starts with a historical analysis of the European Union,
from the establishment of the Union of Payments to the Maastricht Treaty. The
historical events that marked the development of the Union itself to its present
form will be expounded to understand its rationale as well as its broader context.
Indeed, the EU was born when the monetary agreements between States where
radically changing and the consequences of this are different for the European
Countries and the African ones. The second paragraph introduces the birth of the
economic policy coordination and the establishment of a single monetary policy
in the EU context. Later, the third, fourth, and fifth paragraphs analyse the
progressive collapse of the European economy following the breakout of the
Great Recession in the United States. The stability of the system is analysed by
pointing out its flaws and strengths diachronically. Indeed, first the single phases
are illustrated which characterised the European sovereign debt crisis, then a
detailed study of the post-crisis legal framework follows, focussing on the steps
which allowed the Union to come out from the economic crisis and enter a new
period of stability thanks to a renewed legal framework. The sixth and last
paragraph is, instead, centred on the most recent developments, especially those
triggered by the measures taken to react to the COVID-19 pandemic crisis.
The third chapter focusses on the franc zone. The introductive paragraph
identifies the regional groupings present in the area. Indeed, the franc zone
10
Countries border with Countries members of regional groupings outside the franc
zone and in some cases they both participate to the same third regional grouping.
Therefore, it is fundamental to understand the context in which the Member
Countries of the WAEMU, the CEMAC and the Union of the Comoros operate.
The second and third paragraph, instead, are introduced by a historical and legal
analysis of the franc zone to understand the origins of the area and to go through
the landmarks of the CFA franc, from its birth to the establishment of its four
pillars. Indeed, this historical analysis is essential to understand why the CFA
franc is now source of great controversies between academics and politicians
from both sides, the French and the African ones. The fourth paragraph makes
an institutional comparison between the economic and monetary unions of the
franc zone and the European Economic and Monetary Union. Among them, the
WAEMU is undoubtedly the regional grouping whose institutional framework
emulated the most the EU model. Nevertheless, the institutional framework of the
CEMAC and of the Comoros Union is not distant from that of the EU. The fifth
and sixth paragraphs focus on the main current challenges to the economic
development of the franc zone Countries. Indeed, the debate over the CFA franc
has recently focused on the possibility for the participating Countries to abandon
the CFA franc system and establish a new monetary union with a new common
currency for both the WAEMU and the CEMAC Countries. This proposal has
been taken seriously, but in the past the institutions of the two regional groupings
postponed multiple times a radical intervention. The economic and legal analysis
on the ground of which this decision must be taken explain the difficulty in taking
concrete action. The concluding paragraph, instead, deals with the outbreak of
the pandemic crisis and how it affected the scheduled programme for the
adoption of a new single currency for the franc zone Countries as part of the more
general plan to give them back their monetary sovereignty.
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Thesis Chapters by Lorenzo Saviane
are interconnected. This cannot be considered exclusively a consequence of the
developments of globalisation, since even the current relationship between the
European States and the West and Central African States has roots in the
colonial period. The specific aim of this study is to analyse the development of
this relationship through a comparison between the economic and monetary
unions that have been established in both areas. Indeed, this relationship has
radically evolved over time, from the colonial domination to a more complex
monetary relationship which nowadays connects the West and Central African
currencies to the European one. Therefore, the present analysis is focused on
the legal framework of the economic and monetary unions established in Europe,
West Africa and Central Africa, which are connected not only by a historical point
of view, but also by legal provisions.
When the aggressive colonisation of Africa by the European Countries
came to an end after the second world conflict, France was able to maintain a
strong relationship with the Countries where it had extended its dominance since
the XIX century. The African territory comprised in the franc zone extended from
the area of current Senegal on the West to the heart of the continent in the area
of the current Central African Republic. The franc zone has evolved over time
and now includes a total of fifteen African States. Nonetheless, the franc zone
itself is not represented in any single institution. Instead, the franc zone is
composed of three different regional groupings: the West African Economic and
Monetary Union (WAEMU), the Economic and Monetary Community of Central
Africa (CEMAC) and the Union of the Comoros. What all these regional groupings
share with France is a currency, that is, the CFA franc. Indeed, the CFA franc
was first established by France, that made it the legal tender in each regional
grouping. Its characteristics are unique, but similar, in each grouping and France
controls the currency through a set of agreements signed with each grouping.
Through these arrangements France de facto exercises its monetary sovereignty
over the franc zone Countries. The actual advantages and disadvantages of the
CFA franc system have become a source of debate in recent times and different
economic analyses show different results. Anyway, one thing cannot be changed,
that is, the history of the franc zone Countries and of their relationship with
France. Therefore, the historical analysis is greatly relevant to the present study
because only looking at the past relationship between the franc zone Countries
and France first, and the European Union (EU) then, the current issues of the
CFA franc system can be understood.
Nevertheless, to understand the functioning of the monetary and economic
unions of the franc zone the study of the European Economic and Monetary
Union is preliminary. This, not only because the history of France is strictly
connected with the birth and development of the European Union itself, but also
because the legal framework of the economic and monetary unions of the franc
zone, at a closer look, faithfully resembles that of the EU, which shows the
9
closeness of these regimes. Therefore, an analysis of the institutional and legal
framework of the European Economic and Monetary Union is necessary to the
study of the institutional and legal framework of the WAEMU, the CEMAC and
the Union of the Comoros.
In the first chapter the concept of money is introduced, which is
fundamental for the purposes of this study. Indeed, there are multiples general
theories on the concept of money; similarly, there is no single legal theory on it.
The legal concept of money is further analysed as a specific arm of the
sovereignty exercised by States under international law. Indeed, the analysis will
try to answer the questions relating to the scope of the sovereignty of States, thus
of its internal and external boundaries. The first chapter concludes with the
analysis of the two monetary frameworks object of this study: the European Union
and the franc zone. A first section, concerning the Euro, describes its main
attributes as a single currency and legal tender for nineteen of the current twenty-
seven EU Member States. The second section, instead, focuses on the CFA
franc, the single currency and legal tender of the Member Countries of the franc
zone. Both sections adopt the perspective of the erosion of the concept of State
sovereignty, as the EU and African experiences represent two different models
of alienation of monetary sovereignty to a third entity.
The second and third chapters introduce the study of the abovementioned
economic and monetary unions. The second chapter is focused on the European
Economic and Monetary Union, while the third chapter is focused on the West
and Central African context, with an analysis of the economic and monetary
unions that are part of the franc zone: the WAEMU, the CEMAC and the Union
of the Comoros.
The second chapter starts with a historical analysis of the European Union,
from the establishment of the Union of Payments to the Maastricht Treaty. The
historical events that marked the development of the Union itself to its present
form will be expounded to understand its rationale as well as its broader context.
Indeed, the EU was born when the monetary agreements between States where
radically changing and the consequences of this are different for the European
Countries and the African ones. The second paragraph introduces the birth of the
economic policy coordination and the establishment of a single monetary policy
in the EU context. Later, the third, fourth, and fifth paragraphs analyse the
progressive collapse of the European economy following the breakout of the
Great Recession in the United States. The stability of the system is analysed by
pointing out its flaws and strengths diachronically. Indeed, first the single phases
are illustrated which characterised the European sovereign debt crisis, then a
detailed study of the post-crisis legal framework follows, focussing on the steps
which allowed the Union to come out from the economic crisis and enter a new
period of stability thanks to a renewed legal framework. The sixth and last
paragraph is, instead, centred on the most recent developments, especially those
triggered by the measures taken to react to the COVID-19 pandemic crisis.
The third chapter focusses on the franc zone. The introductive paragraph
identifies the regional groupings present in the area. Indeed, the franc zone
10
Countries border with Countries members of regional groupings outside the franc
zone and in some cases they both participate to the same third regional grouping.
Therefore, it is fundamental to understand the context in which the Member
Countries of the WAEMU, the CEMAC and the Union of the Comoros operate.
The second and third paragraph, instead, are introduced by a historical and legal
analysis of the franc zone to understand the origins of the area and to go through
the landmarks of the CFA franc, from its birth to the establishment of its four
pillars. Indeed, this historical analysis is essential to understand why the CFA
franc is now source of great controversies between academics and politicians
from both sides, the French and the African ones. The fourth paragraph makes
an institutional comparison between the economic and monetary unions of the
franc zone and the European Economic and Monetary Union. Among them, the
WAEMU is undoubtedly the regional grouping whose institutional framework
emulated the most the EU model. Nevertheless, the institutional framework of the
CEMAC and of the Comoros Union is not distant from that of the EU. The fifth
and sixth paragraphs focus on the main current challenges to the economic
development of the franc zone Countries. Indeed, the debate over the CFA franc
has recently focused on the possibility for the participating Countries to abandon
the CFA franc system and establish a new monetary union with a new common
currency for both the WAEMU and the CEMAC Countries. This proposal has
been taken seriously, but in the past the institutions of the two regional groupings
postponed multiple times a radical intervention. The economic and legal analysis
on the ground of which this decision must be taken explain the difficulty in taking
concrete action. The concluding paragraph, instead, deals with the outbreak of
the pandemic crisis and how it affected the scheduled programme for the
adoption of a new single currency for the franc zone Countries as part of the more
general plan to give them back their monetary sovereignty.
are interconnected. This cannot be considered exclusively a consequence of the
developments of globalisation, since even the current relationship between the
European States and the West and Central African States has roots in the
colonial period. The specific aim of this study is to analyse the development of
this relationship through a comparison between the economic and monetary
unions that have been established in both areas. Indeed, this relationship has
radically evolved over time, from the colonial domination to a more complex
monetary relationship which nowadays connects the West and Central African
currencies to the European one. Therefore, the present analysis is focused on
the legal framework of the economic and monetary unions established in Europe,
West Africa and Central Africa, which are connected not only by a historical point
of view, but also by legal provisions.
When the aggressive colonisation of Africa by the European Countries
came to an end after the second world conflict, France was able to maintain a
strong relationship with the Countries where it had extended its dominance since
the XIX century. The African territory comprised in the franc zone extended from
the area of current Senegal on the West to the heart of the continent in the area
of the current Central African Republic. The franc zone has evolved over time
and now includes a total of fifteen African States. Nonetheless, the franc zone
itself is not represented in any single institution. Instead, the franc zone is
composed of three different regional groupings: the West African Economic and
Monetary Union (WAEMU), the Economic and Monetary Community of Central
Africa (CEMAC) and the Union of the Comoros. What all these regional groupings
share with France is a currency, that is, the CFA franc. Indeed, the CFA franc
was first established by France, that made it the legal tender in each regional
grouping. Its characteristics are unique, but similar, in each grouping and France
controls the currency through a set of agreements signed with each grouping.
Through these arrangements France de facto exercises its monetary sovereignty
over the franc zone Countries. The actual advantages and disadvantages of the
CFA franc system have become a source of debate in recent times and different
economic analyses show different results. Anyway, one thing cannot be changed,
that is, the history of the franc zone Countries and of their relationship with
France. Therefore, the historical analysis is greatly relevant to the present study
because only looking at the past relationship between the franc zone Countries
and France first, and the European Union (EU) then, the current issues of the
CFA franc system can be understood.
Nevertheless, to understand the functioning of the monetary and economic
unions of the franc zone the study of the European Economic and Monetary
Union is preliminary. This, not only because the history of France is strictly
connected with the birth and development of the European Union itself, but also
because the legal framework of the economic and monetary unions of the franc
zone, at a closer look, faithfully resembles that of the EU, which shows the
9
closeness of these regimes. Therefore, an analysis of the institutional and legal
framework of the European Economic and Monetary Union is necessary to the
study of the institutional and legal framework of the WAEMU, the CEMAC and
the Union of the Comoros.
In the first chapter the concept of money is introduced, which is
fundamental for the purposes of this study. Indeed, there are multiples general
theories on the concept of money; similarly, there is no single legal theory on it.
The legal concept of money is further analysed as a specific arm of the
sovereignty exercised by States under international law. Indeed, the analysis will
try to answer the questions relating to the scope of the sovereignty of States, thus
of its internal and external boundaries. The first chapter concludes with the
analysis of the two monetary frameworks object of this study: the European Union
and the franc zone. A first section, concerning the Euro, describes its main
attributes as a single currency and legal tender for nineteen of the current twenty-
seven EU Member States. The second section, instead, focuses on the CFA
franc, the single currency and legal tender of the Member Countries of the franc
zone. Both sections adopt the perspective of the erosion of the concept of State
sovereignty, as the EU and African experiences represent two different models
of alienation of monetary sovereignty to a third entity.
The second and third chapters introduce the study of the abovementioned
economic and monetary unions. The second chapter is focused on the European
Economic and Monetary Union, while the third chapter is focused on the West
and Central African context, with an analysis of the economic and monetary
unions that are part of the franc zone: the WAEMU, the CEMAC and the Union
of the Comoros.
The second chapter starts with a historical analysis of the European Union,
from the establishment of the Union of Payments to the Maastricht Treaty. The
historical events that marked the development of the Union itself to its present
form will be expounded to understand its rationale as well as its broader context.
Indeed, the EU was born when the monetary agreements between States where
radically changing and the consequences of this are different for the European
Countries and the African ones. The second paragraph introduces the birth of the
economic policy coordination and the establishment of a single monetary policy
in the EU context. Later, the third, fourth, and fifth paragraphs analyse the
progressive collapse of the European economy following the breakout of the
Great Recession in the United States. The stability of the system is analysed by
pointing out its flaws and strengths diachronically. Indeed, first the single phases
are illustrated which characterised the European sovereign debt crisis, then a
detailed study of the post-crisis legal framework follows, focussing on the steps
which allowed the Union to come out from the economic crisis and enter a new
period of stability thanks to a renewed legal framework. The sixth and last
paragraph is, instead, centred on the most recent developments, especially those
triggered by the measures taken to react to the COVID-19 pandemic crisis.
The third chapter focusses on the franc zone. The introductive paragraph
identifies the regional groupings present in the area. Indeed, the franc zone
10
Countries border with Countries members of regional groupings outside the franc
zone and in some cases they both participate to the same third regional grouping.
Therefore, it is fundamental to understand the context in which the Member
Countries of the WAEMU, the CEMAC and the Union of the Comoros operate.
The second and third paragraph, instead, are introduced by a historical and legal
analysis of the franc zone to understand the origins of the area and to go through
the landmarks of the CFA franc, from its birth to the establishment of its four
pillars. Indeed, this historical analysis is essential to understand why the CFA
franc is now source of great controversies between academics and politicians
from both sides, the French and the African ones. The fourth paragraph makes
an institutional comparison between the economic and monetary unions of the
franc zone and the European Economic and Monetary Union. Among them, the
WAEMU is undoubtedly the regional grouping whose institutional framework
emulated the most the EU model. Nevertheless, the institutional framework of the
CEMAC and of the Comoros Union is not distant from that of the EU. The fifth
and sixth paragraphs focus on the main current challenges to the economic
development of the franc zone Countries. Indeed, the debate over the CFA franc
has recently focused on the possibility for the participating Countries to abandon
the CFA franc system and establish a new monetary union with a new common
currency for both the WAEMU and the CEMAC Countries. This proposal has
been taken seriously, but in the past the institutions of the two regional groupings
postponed multiple times a radical intervention. The economic and legal analysis
on the ground of which this decision must be taken explain the difficulty in taking
concrete action. The concluding paragraph, instead, deals with the outbreak of
the pandemic crisis and how it affected the scheduled programme for the
adoption of a new single currency for the franc zone Countries as part of the more
general plan to give them back their monetary sovereignty.