Central bank gives poor more time to swap old bank-notes

West Africa’s central bank has finally agreed to give people living in remote rural areas across the region more time to swap old bank notes for new in what it described as an “exceptional” exercise. Charles Konan Banny, the governor of the Central Bank of the States of West Africa (BCEAO), which controls the CFA franc currency used by eight countries, told a news conference at the bank’s Dakar headquarters on Wednesday that a second drive to mop up old notes issued since 1992 would take place from 17 January to 18 February. The initial 10-week campaign to swap old bills for new wound up on 31 December with the BCEAO saying 99.2 percent of the old bank-notes had been recovered. The remaining currency was believed to be mainly small denomination notes left in the hands of people living in far-flung areas or in the northern rebel-held half of Cote d’Ivoire. Banks servicing more than six million people there closed down at the outbreak of civil war in 2002. “We note that at the end of the campaign, 59 billion CFA francs (US$118 million) have not been recovered, much of this sum being bank-notes in small denominations of 1,000 and 500 CFA francs,” Konan Banny said. “We presume they are still in circulation and are largely in the hands of low-income earners in rural areas.” “We are going to organise an exceptional operaton to recover the ’92 series bank-notes,” he said The BCEAO went to great lengths at the end of 2004 to exchange the notes, enrolling town criers, UN peacekeepers and even desert pilots for the exchange of currency . The scheme to withdraw old notes was launched September 15. The new series of notes is supposed to be harder to forge. Konan Banny said 4,000 forged bank-notes had turned up during the swap but did not say how much they were worth. During the month-long exercise holders of the old bank-notes will have to turn them in either to BCEAO offices or exchange offices run by national treasuries. 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.