Madagascar launches new currency, the ariary

ANTANANARIVO, July 31 (AFP) - Madagascar on Thursday launched a new currency, the ariary, to replace the outmoded Madagascan franc.

The reference to the franc "lost its raison d'etre since the arrival of the euro," a central bank official said Thursday.

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The new currency's smallest paper denomination of 500 ariaries is worth about 19 euro cents (21 US), and 100 of the old currency.

The bills, with denominations ranging up to 10,000 ariaries, are smaller, more durable and reputedly impossible to counterfeit.

The Madagascan franc itself replaced the CFA franc in 1973, a currency shared by former French colonies which is still in use primarily in west Africa.

The ariary, which means "five units", is worth five iraimbilanja, meaning "one unit".

It was the name of a pre-colonial currency, and rural people have traditionally used the name for their money.

Old Madagascan franc bills will be phased out until the end of November 2004, and will be valid at banks until the end of 2005. The central bank said it would exchange them until 2009.

Madagascar, an impoverished archipelago off Africa's southeastern coast, won independence from France in 1960.

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