Despite growing calls for economic sovereignty, West Africa’s $67 billion reserves still heavily reliant on European banks, gold hubs.

West Africa’s foreign reserves, valued at about $67 billion and managed by the Central Bank of West African States (BCEAO), remain largely held through European banks and vaulting hubs, despite growing debates over economic sovereignty.

Yet its latest audited accounts show a highly concentrated structure: about 86% of external assets are held with European counterparties, 82% of foreign exchange reserves are euro-denominated, and 92% of physical gold reserves are stored in Europe.

Certified in the 2025 audit by Deloitte Côte d’Ivoire, the figures point to a system still shaped by historic monetary arrangements linked to Franco-African cooperation and later anchored to the euro after 1999.

Although a 2019 reform ended the obligation to deposit reserves with the French Treasury, the geographic distribution of assets has remained largely unchanged.

Europe still dominates custody of West Africa’s gold

“The location of gold reserves in Europe is primarily a market constraint, not only a political choice,” an economist told Ecofin Agency, noting that London and Zurich remain the world’s most liquid gold hubs.

The report shows that 87% of gold and foreign exchange assets are still held in Europe, reflecting global custody and liquidity structures rather than recent policy shifts.

The BCEAO’s gold stock stood at 1.52 million ounces at end-2025, valued at CFA3,640 billion (about €5.5 billion). The 44% year-on-year increase in value was driven largely by higher global prices rather than new purchases.

Heavy reliance on European financial infrastructure

Of total gold holdings, 92% is stored with European counterparties, while just 8% is held in Africa and the Middle East. In addition, 76% of reserves are held as correspondent deposits, highlightinh reliance on foreign banking networks for settlement and liquidity.

Euro-denominated assets account for 82% of foreign exchange reserves, anchoring the region’s liquidity to European markets and instruments. Analysts say this reflects both historical ties and the practical need for access to deep, highly liquid capital markets.

The pattern is not unique to West Africa. Similar reserve structures are observed at the Bank of Central African States, suggesting a broader regional preference for security and liquidity over geographic diversification.

Source: africabusinessinsider