French influence leads black Africa

Press, 16 July 1982, Page 12

French influence leads black Africa

The black African economies which have done best since independence include most of the 13 nations in the French African community C.F.A., a customs union with a shared currency, whose members are firmly tied to the economy of their former colonial master. For the past two decades the gross national product of the C.F.A.’s members has grown at twice the black African average. Sound money, with exchange rates pegged to the French franc, has kept big spenders in check, helped to prevent the emergence of cheap-food policies that are now destroying agriculture in much of the rest of the continent and persuaded francophone Africa to use its own resources for growth instead of relying on imports and foreign borrowing. This article, from the “Economist”, London, looks at what has made the former French colonies the envy of their neighbours.

In Ndjamena, Chad, in the heart of francophone Africa, a girl walks down the street sporting the miniskirt and head-scarf now in fashion again in France. The lower part of her face is hidden by a fine, beige veil. Most African women either hang on to their traditional dress (and undress) or abandon it for modem styles. But countries in francophone Africa have grafted the people, habits, and institutions left by French rule on top of their own. French civil servants still dominate local bureaucracies. France is the region’s biggest trading partner. French is the businessman's language. The French African community’s members are Gabon, Congo-Brazzaville, Cameroon, the Central African Republic, Chad, Niger, Upper Volta, Ivory Coast, Senegal, Togo and Benin. Mali arid Mauritania are members of the customs union, but they have their own currencies. France guarantees the international convertibility of the C.F.A. franc at a fixed exchange rate, while the 11 full C.F.A. members plus Mali and Mauritania deposit 65 per cent of their hard-currency earnings in a special account at the French Treasury. The rest of the hard-currency reserves of members are lodged with the community’s two central banks, in Dakar (the capital of Senegal) and Yaounde, (the capital of Cameroon). By sticking to a sound exchange rate and leaving the community’s central bankers to run their monetary affairs, French African economies have benefited in three ways. ® Comparatively low inflation,

which makes businessmen's sums easier and also makes domestic savings high. According to World Bank economists, savings in C.F.A. countries averaged 12 per cent of gross domestic product a year throughout the 19705, against an average of 7 per cent in black Africa as a whole.

members during the previous fiscal year can be offered by the central banks. Credit ceilings on short-term and medium-term loans, and on loans to each sector of the economy of a member state, are also fixed. The French treasury sets targets for the expansion of money supply in the C.F.A. area.

• Farmers are left to set their own prices because C.F.A. governments cannot print money to pay for the huge food subsidies that hav.e led the way to controls on farm prices, and then declining agricultural output elsewhere in Africa. Oilrich Gabon spent a lot on food subsidies last year, but was forced to cut back when the oil glut reduced its revenues.

Some member nations have tried to sneak round these credit controls by borrowing from abroad. Such truancy became harder after Gabon, Senegal and the Central African Republic all ran into trouble with their debts in 1979. All foreign loans to C.F.A. countries and their dealings with the International Monetary Fund are now vetted by the community's central banks. The adjustments forced on the C.F.A.' economies by their sensible exchange rate have kept their current overseas deficits to an average of 6.5 per cent of gross national product since 1973, lower than the average for black African economies. Even so, occasional rejigging of the C.F.A. franc against the French franc have usually kept the community’s exports competitive. By contrast, most of the non-franco-phone economies south of the Sahara suffered from overvalued currencies throughout the 1960 s and 19705. The recent devaluation of the French, franc, however, has led to renewed pressure for a realignment of the C.F.A.’s franc against the French currency. Nearly 40 per cent of the French African community’s exports go to France, which supplies 70 per cent of its

• Trade is easier because countries inside the community can pay for imports from their neighbours with their own currency.

The hubs of the French African community are its two central banks and the French themselves. There are 470,000 French citizens in west Africa, 10 times as many as there were two decades ago when most of the countries in the region won their independence from France. Of those, 12,000 are French troops.

Each of the C.F.A.’s two central banks has a French treasury official as chairman of its board of directors. Each member country has two representatives on the board that oversees its region. The decisions of either board can be vetoed by the French.

The volume of credit in each member country' is strictly controlled by the central banks. Credits of up to 20 per cent of the budget receipts of

imports. French business dominates the C.F.A. economies. Elf-Aquitaine takes 60 per cent of oil exports from both Cameroon and CongoBrazzaville. All telecommunications in the -.C.F.A. nations are run by Thomson-Brandt; and most international calls must still go through Paris. The French company. Somair — with interests in Niger’s uranium, Mauritanian phosphates and potash, and timber in Cameroon — is one of west Africa’s most powerful mining and natural resources groups. France has supplied 82 per cent of foreign investment in the French African community. Less than a third of foreign investment in former British colonies and protectorates comes from Britain.

Frenchmen are bosses at the 17 public corporations in Gabon. whose public sector buys 70 per cent of the goods it needs in France. France’s ministry for co-operation and development estimates that 30 per cent of senior civil servants in all C.F.A. countries are French citizens.

The French were quick to see that their plans for a French African community would collapse if farming in the region failed. In 1965. General de Gaulle started supporting commodity prices of their most basic products. The French have insisted that farmers get paid well for what they produce. Aid from France provides a powerful means of persuasion. In 1970-80, Senegal received $4.2 billion in aid under the French scheme-for offsetting swings in commodity prices. In the 19705, land under cultivation in - the French African community increased by more than 80 per cent. Most of the profits from agricultural exports are ploughed back into farming. Critics of the French African community say that it prolongs French domination of the region. but neighbouring countries still want to join the club. Mali and Mauritania, which left the C.F.A. in the 19605, rejoined the customs union. Socialist Madagascar is negotiating to rejoin it. Zaire, a former colonial possession of Belgium, now wants membership too.

The French government often sends black Frenchmen to friendly African governments to defuse charges of white domination (tact that the British foreign office has yet to learn).

France has a tight hold over the public sector in the C.F.A. economies. Two of every three top civil servants in the Ivory Coast are French citizens. They prefer to do business with French companies: last year about 95 per cent of the budget of Ivory Coast’s ministry of information, for example, was spent on business done by the publishing arm of the French company Matra. Young

The French African community is used to being attacked by newly-independent African states as an example of colonial exploitation. Its benefits have silenced much of the criticism.

French tutelage has proved most successful in agriculture. When the tricolour was lowered in Africa. 95 per cent of the population lived on the land. Peasants were poor and illiterate. Most of them still are, but policies followed since the French colonialists became benevolent neo-colonialists have saved most of the community’s farmers from destitution.