"EMU: Lessons for the CFA zone"

Healy, Conor. (2003) "EMU: Lessons for the CFA zone". In: UNSPECIFIED, Nashville, TN. (Unpublished)

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Abstract

Like so many aspects of the European project, the sheer uniqueness of European Monetary Union can often make proper comparative analysis seem difficult and even strained. It seems in so many different ways to mark out uncharted territory. After all, this is a monetary union of democratic states, with largely stable and highly developed economies. These states have voluntarily ceded complete control over their monetary policy to an independent central bank. Indeed they have acquiesced to an externally determined monetary policy with price stability as its primary goal, and they have signed up-nominally, at least-to some very tight controls on their fiscal behavior. Responding, at least partially to the comparative constraints, much of the recent analysis has focused on using accumulated data of the early years of the euro to begin to measure economic effects and suggest possible future consequences. A number of other analyses have talked in terms of future institutional reforms, especially with regard to possible expansion to the east. These are obviously issues of profound concern to policymakers. In this paper, however, I will argue for at least a partial return to the comparative approach. Specifically, I will argue that there are still some lessons that the euro area can learn from its African cousin-the CFA franc zone.

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