Small Countries in Monetary Unions: The Choice of Senegal

Senegal belongs since independence to the West African Monetary Union (known by its French acronym UMOA). The country has therefore chosen to fix its exchange rate against the other partners in the union. More importantly, all partners have agreed that the union currency=the CFA franc=will be kept at a fixed rate of 0.02 against the French franc. This fixed rate, enforced by the union-wide central bank, is guaranteed by France. Maintained since October 1948, the CFA-French franc rate is probably the oldest pegged parity. ^{1 >}