Mali, Paris and the CFA Franc

It's an interesting feature of modernity that cultural violence seems to be the strongest indicator of future war. From Nazis burning books, to the Taliban blowing up stone Buddhas, one only has to look at intolerance in explosive, passive form, to imagine the bombs and fires dropping elsewhere later. I remember feeling the same as I read the stories of Islamists despoiling the tombs of Mali, though as my one demented reader knows I've thought for some time that North Africa, particularly in a bad food year, is probably the best strategic ground on which Al-Q's Maghreb franchises might challenge the West.

There's also not that much Marxist about a cultural materialism which suggests that securing Europe's energy supplies now is better than doing so later. Hospitals and libraries are terribly difficult to run on solar power and waste, after all. People fight over resources because they won't trade, and trade failures are regime failures.

There's one aspect to what is going on in Mali, however, which seems to have escaped attention. I'm not completely sure myself how important it is, though I'd suggest that it should not be ignored. Mali is part of a currency union which is longstanding and which was, hitherto, very successful. it emerged from the French colonial empire, and today covers some 15 countries in West Africa under the aegis of the CFA, or African Financial Community. Some of the countries in the Union use a common currency, the CFA Franc. This currency is maintained by the Central Banks of West Africa, covering hundreds of millions of people, and is guaranteed by the Bank of France. Its credit line, therefore, stretches into Paris.

Like many modern States, Mali is a compound nation. As with many African areas, its peoples--the Songhai, Tuareg and Arab--are often at each other's throats. Serious devaluations of the CFA Franc, 85% of the foreign reserves backing which are in Paris, threaten Mali's stability, and those of states such as the Cote D'Ivoire and Niger associated with it.They also counter Mali's agricultural potential, since, with food prices poised to rise, its farmers might have hoped for a boost in exports this coming year. 

A collapse into anarchy, or the withdrawal of the CFA Franc in such circumstances, could possibly be preceded by an outflow of West African funds from France; but a French invasion and cheap repurchase of goods so as to maintain at least two of the three peoples there, could forestall that. By taking on Islamists in Mali, France might also avoid giving them a base in the rest of the CFA or Algeria, and it may leave France--the only non-US state with a nuclear aicraft carrier and soon the biggest military state in Europe--poised to takeover a hegemonic role as the US withdrew to energy sufficiency and fiscal rebuilding.

So one can see how the French were thinking. These things matter to France, in a way that they do not to Britain. Since 1962, there have been some forty-three French interventions in former colonies, all with a nominal mission to stabilise, all resulting in strengthened mutual financial ties. 

Al-Qaeda seems to understand the stakes, countering French intervention in Mali with its own high-stakes capture of a gas facility in Algeria, and, one would expect in coming days, in other parts of North or West Africa too. My concern is that the French have gone in with too few troops, with no clear line as to whether they are going to use special or rapid conventional forces, no real capacity to expand the war if their strategy fails, and not much in the way of backup. They, and therefore we, are also massively exposed economically. 

The Islamists could, by drawing things out or refusing to fight in Mali, open a wound which would see Mali break up, African agricultural crisis deepen, and the energy lines to Italy catch fire. They face no real regional opposition now that Gadaffi is gone, and indeed may find remnants of Gadaffi's forces from his Chadien shenanigans swelling their ranks. They could also force a run on French reserves.

As I understand it, only the French Treasury knows how much money that run could involve, and only they know whether they actually have the 85% of African reserves or whether they have already sold them on to prop up the euro.

So, we are in for interesting times in Mali. I hope that the country pulls through. Like Lebanon, what little I know of it, I like, and its cultural reputation, especially in terms of its music, is enough to melt the heart. What I am sure of, however, is that most people are not quite aware of the stakes in the game which has taken over Mali's future.


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