Abstract
Most independent states have their own national currencies. Worldwide, only four groups of countries issue a common currency and conduct joint monetary policy.1 With so few countries belonging to a monetary union, conducting monetary and related macroeconomic policies in a common currency area does pose “uncommon” challenges. Two of the four monetary unions are in Africa: the Central African Economic and Monetary Community (CEMAC) and the West African Economic and Monetary Union (WAEMU) (Figure 1.1). While CEMAC and WAEMU each have their own distinct currency, they are closely linked: both unions peg their currencies to the euro at the same level, they share certain institutional features, and they are commonly referred to as the CFA franc zone.2