What Is the Bank Of Central African States (BEAC)?
The Banque des États de l'Afrique Centrale (BEAC) is the central bank serving the Economic and Monetary Community of Central Africa (CEMAC). CEMAC is composed of six country members, Cameroon, the Central African Republic, Chad, Equatorial Guinea, Gabon, and the Republic of the Congo. CEMAC is a member of the larger African Economic Community.
- The Bank Of Central African States (BEAC) is the central bank of the Economic and Monetary Community of Central Africa (CEMAC).
- The bank was established in 1972 and is headquartered in Cameroon, where it manages monetary policy, issues currency, and manages the foreign reserves of member states, among other actions.
- BEAC's official currency is the Central African CFA franc, which has an exchange rate tied to the euro. The CFA franc is expected to be reintroduced as the Eco but the process has been delayed due to the impact of COVID-19.
Understanding the Bank Of Central African States (BEAC)
BEAC was established in 1972 under the official name Banque des États de l'Afrique Centrale (BEAC). The bank's head office is in Cameroon. The bank's role is to manage the region's monetary policy, issue currency, drive the exchange rate of the region, manage the foreign reserves of the member states and facilitate payments and settlement systems.
The BEAC has also implemented macroeconomic convergence, which means it is attempting economic catch-up and monitoring mechanisms. The bank has also adopted a customs union and common external tariff, combined indirect taxation regulations, and initiated structural and sector policies.
BEACS's Currency Evolution
BEAC's official currency is the Central African CFA franc, which had an exchange rate that was formerly fixed to the French franc but is now fixed to the euro.
In December 2019, the heads of the eight countries that comprise the West African Economic and Monetary Union (WAEMU), and the larger 15-member Economic Community of West African States (ECOWAS) announced the CFA Franc would soon be renamed the Eco and have fewer ties to France going forward. The currency would still be pegged to the euro but the African countries won't have to keep 50% of their reserves in the French Treasury and won't have to keep a French representative on the currency union's board. However, the new currency, which was intended to go into circulation at the end of 2020, has been delayed for as many as five years as a result of the COVID-19 impact.
Scandals at the BEAC
The BEAC has not been free of scandal. Philibert Andzembe of Gabon had been the governor of the BEAC from July 2007 until October 2009. Andzembe was fired by the new president of Gabon, Ali Bongo after $25 million disappeared from the bank's Paris branch.
A WikiLeaks memo dated July 7, 2009, stated that Gabonese officials working for the Bank of Central African States stole $36 million over a period of five years from pooled reserves and gave the majority of the money to members of France’s two main political parties. In late 2010, Lucas Abaga Nchama of Equatorial Guinea was the bank's new leader.
In late 2016, a new management team was announced, which included Abbas Mahamat Tolli from Chad and Dieudonné Evou Mekou from Cameroon who had been appointed at the 27th Special Session of Heads of State of the Economic Community of Central African States (CEMAC) in Malabo.
BEAC's Strategic Plan
According to the World Bank, the BEAC’s Strategic Plan was confirmed by the BEAC’s Board of Directors on December 21, 2017.
The plan outlined reforms including implementing the monetary policy that was laid out in the operational framework adopted in 2015 by the Monetary Policy Committee; continuing information system acquisition research to obtain accurate and timely data; updating the legal framework for payment systems and infrastructure with a focus on electronic payments and e-money (monetary value stored on a digital device); improving financial analysis; stabilizing and increasing foreign reserve levels by controlling outgoing transactions and launching a gold monetization program and installing and integrating foreign exchange IT systems for better tracking.