Bank sends teams into rebel north to collect old banknotes

The Central Bank of the States of West Africa (BCEAO) said on Wednesday that it will send officials to the rebel-held north of Cote d’Ivoire next week in a last-minute drive to swap old bank-notes for new. The BCEAO, which controls the CFA franc currency used by eight nations in West Africa, launched a drive in mid-September to withdraw billions of the often torn and crumpled notes by 31 December and replace them with a new series. However, until now it had made no special effort to mop up the old banknotes circulating in the rebel-held north of Cote d'Ivoire, where all banks have been closed since the outbreak of civil war in September 2002. The breakthrough was announced after a BCEAO team visited the rebel capital Bouake on Tuesday for talks on the currency switch. This threatens to leave millions of people in the north of Cote d'Ivoire holding old notes that will be worthless after the end of this month. Rebel spokesman Cisse Sindou told IRIN on Wednesday that mobile tellers from the BCEAO would be sent to Bouake and the two other main towns in rebel territory, Korhogo and Man, to mop up old notes and exchange them for new ones. These teams of bank officials are likely to be assisted and protected by the United Nations' 6,000-strong peacekeeping force in Cote d'Ivoire, he added. However, a spokesman for the central bank at its headquarters in Dakar, Senegal told IRIN that the BCEAO was sticking to its 31 December deadline for withdrawing old notes from circulation throughout West Africa. “What we’ve decided to do is to send mobile teams in to make sure people can swap the old bills for new ones,” Madior Sylla said. “But we’re not extending the deadline.” The bank says the crispy-clean new notes are harder to forge. But the introduction of these smaller bills will also prevent the laundering of buckets of cash which have been robbed from its coffers in Cote d’Ivoire. Diplomats suspect that the rebels financed their insurgency with the proceeds of a raid on the BCEAO's Ivorian head office in Abidjan shortly before the civil war began. Rebel fighters were subsequently blamed for a successful raid on the bank's Bouake branch and attempted break-ins to the BCEAO vaults in Man and Korhogo. Soldiers serving with the French peacekeeping force in Cote d’Ivoire have also been caught stealing notes from banks they were guarding in rebel territory over the last 15 months. The rebels are afraid of losing cash and economic clout as a result of the withdrawal of the old series of banknotes, whose design has remained unchanged since 1992. “We want the BCEAO to postpone the operation because if the exchange of currency is badly handled it will just cause more conflict,” Cisse said. Already, as the 31 December deadline nears, more and more residents in the rebel zone are finding it difficult to get rid of their old bills. In many parts of the region people keep their savings in cash hidden under the bed. “People are scared, there is a real problem” said Soumahoro Makenzi, a schoolteacher in Bouake. “When I went to the market today no-one would accept my only 1,000 CFA note (US$2).” But at BCEAO headquarters, Sylla said the BCEAO had given its eight member states ample warning about the currency swap which was already substantially complete. “We’ve already collected 90 percent of the old series,” he said. “We’ve done everything we could to make sure people swapped the banknotes. We sent messages out on radio, not just national radio, but rural stations and community and religious networks,” he said. The CFA franc, which is backed by the French treasury, was introduced in 1945 to provide the then French colonies with a stable currency. Originally tied to the French franc, it is currently pegged to the euro at a rate of 656 CFA francs to one euro. The BCEAO issues the currency in Benin, Burkina Faso, Cote d’Ivoire, Guinea Bissau, Mali, Niger, Senegal and Togo. The currency is also used by seven Central African states. These have their own central bank and use different notes which are due to be swapped for a new series in early 2005.