When we speak of colonialism, many people think of a bygone era — European empires, territorial conquests, African and Asian colonies that supplied gold, spices, cotton, oil, and cheap labor to Western capitals.
Yet even though colonial flags no longer fly over Dakar or Jakarta, the economic and political dominance of the West has never really disappeared. It has merely changed form.
Today, subjugation no longer occurs (only) through military force, but through financial, commercial, and monetary mechanisms that keep millions of people trapped in dependency.
At the heart of this system lies a concept often cited but rarely understood in its depth: seigniorage — the power to create money and to decide, in practice, who has access to credit and on what terms.
1. Seigniorage: The Hidden Power of Money Creation
The term seigniorage comes from the medieval right of the “seigneur” — the lord — to mint coins.
In modern terms, seigniorage is the profit derived from issuing money, that is, the difference between the nominal value of money and its actual cost of production.
In today’s economy, that power no longer belongs to kings but to central banks — especially those of Western nations and, in the Eurozone, to the European Central Bank (ECB).
In the United States, the Federal Reserve (the Fed) holds the authority to create dollars out of thin air, which it then lends to the banking system and the government by purchasing Treasury bonds.
The Dollar as Global Currency
After World War II, the Bretton Woods Agreements (1944) established the U.S. dollar as the global reserve currency, replacing gold as the world’s reference point for trade.
Even though President Richard Nixon ended dollar convertibility to gold in 1971, the U.S. currency remained the foundation of the global financial system.
This means that most international trade — including oil, gas, metals, and grains — is still denominated in dollars.
As a result, the United States can issue public debt in its own currency, purchasing real goods from the rest of the world with money that costs virtually nothing to produce.
In other words, the dollar allows Washington to live beyond its means, exporting inflation and financial crises to other countries.
2. Economic Neocolonialism: When Debt Becomes a Weapon
If the 19th century saw European powers conquer colonies through armies, today subjugation occurs through unpayable debts, conditional loans, and market mechanisms that bind weaker economies hand and foot.
The Role of International Financial Institutions
The main levers of modern economic neocolonialism are the International Monetary Fund (IMF) and the World Bank, two institutions created after World War II to “stabilize” the global economy but which often impose destructive structural reforms on the Global South.
When an African or Latin American country faces a balance-of-payments crisis and requests IMF assistance, the loan usually comes with strings attached:
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drastic cuts to public spending and social subsidies;
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privatization of state-owned enterprises;
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liberalization of markets for foreign capital;
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limitations on state intervention in the economy.
These so-called “structural adjustment programs” devastated entire societies in the 1980s and 1990s — producing unemployment, shrinking health and education budgets, capital flight, and loss of economic sovereignty.
Far from solving their problems, indebted countries became locked in a cycle of dependency, borrowing new money to repay old debts, while control of their economies remained in foreign hands.
3. The Debt System: An Invisible Empire
Today, the public debt of developing nations totals trillions of dollars, much of it denominated in strong currencies (dollars, euros, yen).
That means debtor countries must export real resources — raw materials, energy, labor — to earn the hard currency needed to pay interest.
The result is a continuous flow of wealth from the Global South to the Global North, even though formal colonial empires no longer exist.
This is a silent form of colonialism: no armies are needed, only an asymmetric financial system that makes it impossible for poor nations to escape debt.
In Africa, for instance, many countries produce vast amounts of oil, gold, diamonds, and cobalt, yet remain impoverished.
Western multinationals extract and sell the resources, while local governments — often corrupt or pressured by creditors — receive only a fraction of the profits.
The outcome is a form of economic imperialism disguised as cooperation.
The West controls credit, trade rules, international courts, and production chains; the Global South provides the raw materials and labor.
4. The CFA Franc: Africa’s Denied Monetary Sovereignty
One of the most striking examples of monetary neocolonialism is the CFA franc, used by 14 African nations.
This currency, introduced during French colonial rule, remains pegged to the euro and guaranteed by the French Treasury.
In practice, a portion of African reserves must still be deposited in France.
This means that France retains enormous influence over the monetary policy and reserves of its former colonies.
Many African economists describe the CFA system as a form of “monetary colonialism”, since these countries cannot make independent economic decisions.
In recent years, the debate has reignited, with several African governments calling for the creation of a pan-African independent currency to restore sovereignty.
5. Multinationals: The Corporate Face of Power
Beyond monetary and financial control, modern neocolonialism manifests itself through the domination of Western multinational corporations.
These giants — in energy, technology, and agribusiness — control entire global value chains.
Some key examples:
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Big Oil companies (ExxonMobil, Chevron, Shell, BP, TotalEnergies) extract oil and gas across Africa and the Middle East, often partnering with authoritarian regimes.
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Pharmaceutical corporations patent drugs developed from local plants or knowledge, then sell them back at prices the original countries cannot afford.
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Agro-industrial giants like Cargill and Monsanto control seeds, fertilizers, and global food chains, undermining food sovereignty.
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Big Tech companies (Google, Meta, Amazon, Apple, Microsoft) dominate digital infrastructure and data flows — a new form of “algorithmic colonization.”
This economic dominance is reinforced by legal power: through international trade agreements and investor–state arbitration, corporations can sue sovereign governments if domestic laws reduce their profits.
The outcome is limited sovereignty — rich nations make the rules, poorer ones must obey.
6. Global Finance and Digital Currencies: The New Frontiers of Control
Over recent decades, financial globalization has further strengthened Western dominance.
Capital markets, controlled by Wall Street and the City of London, determine the cost of money for the rest of the world.
Western investors oversee rating agencies, hedge funds, derivatives, and other instruments that can make or break entire economies overnight.
With the rise of cryptocurrencies and central bank digital currencies (CBDCs), a new chapter is unfolding.
While some see crypto assets as tools of liberation, others warn that digital dollarization and centralized financial infrastructures could deepen global dependence on Western-controlled systems.
In this emerging landscape, non-Western nations risk becoming even more reliant on technologies and platforms managed by foreign powers.
7. The Global South Strikes Back: BRICS and De-Dollarization
Despite this bleak outlook, the Global South is beginning to fight back.
In recent years, an increasing number of countries have sought to reduce their reliance on the dollar and on Western-dominated institutions.
The BRICS alliance (Brazil, Russia, India, China, South Africa — recently expanded to include new members in 2024) has launched several initiatives:
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a New Development Bank as an alternative to the IMF and World Bank;
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cross-border payment systems based on local currencies or currency baskets;
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trade agreements in yuan, rupees, or rubles, bypassing the dollar.
China, through its Belt and Road Initiative, and Russia, via energy diplomacy, are reshaping global geopolitical balances by offering developing nations new forms of credit and investment.
However, these alternatives are not without risks: dependency could simply shift from one hegemon to another.
Conclusion
Modern neocolonialism is no longer defined by empires and borders but by invisible networks of debt, money, trade, and data.
Seigniorage and credit control remain at the heart of this system: whoever decides the value of money ultimately decides the fate of nations.
Through its central banks, financial markets, and multinational corporations, the West continues to extract wealth from the rest of the world — often hiding this power behind rhetoric about “free markets,” “development aid,” and “international cooperation.”
The future will depend on whether the Global South can build independent, cooperative, and sustainable economic systems, rooted in monetary sovereignty and solidarity.
Only then will it be possible to break the invisible chains of modern colonialism — those of debt, finance, and money.