Holding of the franc area meeting at Kintele

13 Apr, 2018

The Ministers of Finance, the chairmen of regional financial institutions and the governors of central banks of the franc area met from  Thursday 12 to Friday 13 April, 2018 at kintele, in the northern suburb of Brazzaville, Republic of the Congo,  under the chairmanship of honourable Calixte Nganongo, Congolese Minister of Finance and Budget, in the presence of the  French Minister  of Economy and Finance, Mr. Bruno Le Maire.

Prime Minister  Clement Mouamba  opened the meeting on April 13, 2018,  a day after the holding of the experts meeting, which was chaired by  the general manager of money and foreign  financial relations of Congo,  Roger Gossaki.

The Ministers of finance examined the following items on the agenda : " the macroeconomic situation and the state of nominal convergence in the franc area", "fight against money laundering and financing of terrorism", "multilateral news: preparation of the review of poor countries  tools of the International monetary Fund (IMF), macroeconomic perspectives in the franc area : risks and opportunities", etc.

In the press release issued at the end of  the meeting, the participants noted a slight  progress in nominal convergence, which is below  expectations.  They particularly noted the risks related to huge public deficits  and to a quick indebtedness, which may put into question internal and external equilibrium of the relevant States. So as to enable a smooth running  of monetary unions, UEMOA, UMAC, Union des Comores and  the sustainability of development paths, the Ministers of Finance from 15 countries of the franc area,  chairmen of regional financial institutions and governors of central banks agreed to maintain and  to strengthen their coordinated approach.

Likewise, actual nominal convergence  has not been achieved yet in the franc area in view of the many difficulties in achieving regional integration.

Given the context, the participants stressed the need to follow up the implementation of the measures to strengthen regional integration, as a factor of resilience and solidarity of the franc area States. In this  regard, they commended the use of new follow up tables of the recommendations made by the Ministers of Finance on commercial integration, credit development and mobilization of tax revenues. These tools of orientation of public policies will enable to back up efforts of convergence of the franc area countries.

The Ministers of Finance noted that most franc area countries concluded a programme with the IMF, for  the harmonization of diagnosis at the sub-regional level and for the coordination of macroeconomic policies, as well as the economic and financial reforms implemented. The measures taken on the basis of the programmes and  the funds provided, notably  by the IMF, the World Bank, the African Development Bank, the EU and France contribute to the improvement of the economic situation and  the restoration of  confidence in the franc area. 

Congo encouraged to quickly conclude a programme with the IMF

As regard Congo-Brazzaville, one of the countries negotiating with the IMF, the French Minister of Economy and Finance, Bruno Le Maire, announced that Paris was ready to grant 135 million Euros to Brazzaville (around 88 milliards 546 million CFA Francs) in the event that Congo would conclude a three-year medium term economic and financial programme with the IMF, a Bretton Woods financial institution.

The meeting has enabled Ministers of Finance of the franc area and  governors of central banks to exchange views on the importance of the fight against financing of terrorism. They particularly thanked GIABA (Intergovernmental Action Group against Money Laundering in Wet Africa) and  GABAC ( Action Group against Money Laundering in Central Africa) for the writing of a draft document on the issue,  backed by the World Bank. They agreed  on a series of undertakings contained  in the document and invited the relevant authorities to learn from it.

In relation to the issue of mobilizing internal resources, the participants also  exchanged their views on the need to strengthen the fight against illegal financial flows and the financing of terrorism through  international tax cooperation and the implementation of adapted measures with the help of central banks, bank committees and regional bodies like GAFI (Financial Action Task Force).  The Ministers of Finance decided to back up the Yaounde Declaration, November 15, 2017. The declaration encourages African countries to think about cooperation to support African countries in fighting illegal financial flows in order to improve  the mobilization of internal revenues.

On the sidelines of the meeting, administrators representing France and  French speaking countries working for the World Bank and the IMF once again talked about the macroeconomic  situation sub-Sahara Africa.  They also talked about the next meetings of the IMF and the World Bank, which will take place from 20-22 April, 2018  in Washington.

Before the participants left, a press conference was held and  during which Mr. Bruno Le Maire said that the future of the CFA franc would only depend on the Franc area States' will  and not on Paris'.  As regard to a potential devaluation of the currency, he said that it was out of question to devaluate  a currency that was not overvalued, adding that the issue had nothing to do with the name of the currency,  but with  its stability.

The next biannual rotating meeting of Ministers of Finance of the franc area States will be held in October 2018 in Paris (France).

Press department of the Ministry of Finance