IMF review says Côte d’Ivoire’s economic progress ‘on track’

Out-Law News | 08 Apr 2014 | 8:44 am | 1 min. read

Côte d’Ivoire’s economic and financial programme “remains on track” and macroeconomic prospects for 2014 remain positive – but the outlook is partly dependant on rising private investment, an International Monetary Fund (IMF) mission has concluded .

The IMF mission visited Abidjan last month for talks on the agency’s fifth review of Côte d’Ivoire’s economic and financial programme, which is supported by an arrangement under an Extended Credit Facility (ECF).

Michel Lazare, assistant director in the IMF’s African department, said after the mission: “Clear progress has been made recently in the implementation of structural reforms, especially to improve the business climate as indicated by the improvement in Côte d’Ivoire’s ranking in the World Bank 2014 report on ‘Doing Business’.”

Lazare said delays had been encountered in some areas, but added: “The mission welcomes the authorities’ commitment to finalise and adopt shortly a medium-term wage bill strategy, a financial sector reform strategy, a public bank restructuring plan and measures to strengthen public financial management.”

The fifth programme review paves the way for disbursement of about $74 million under the ECF arrangement with the West African nation – subject to approval by the IMF’s management and executive board, which is expected at the beginning of June 2014.

According to the IMF, macroeconomic performance continued to be “impressive” in 2013, with economic activity expanding by an estimated 8.7%, which the IMF said is close to the government’s objective.

Inflation “remained subdued” at some 2.5%, the IMF said, while budget execution “was better than anticipated in 2013”, with the basic primary deficit estimated at 11.7 billion West African francs [XOF] (about $25m) compared to XOF 44bn ($92m) under the programme.

The IMF said: “All quantitative performance criteria and indicative targets at the end of 2013 under the ECF arrangement were met, except for the quantitative target on the amount of floating debt.”

Virginie Colaiuta, an international arbitration specialist at Pinsent Masons, the law firm behind Out-Law.com said the IMF’s report reflected increased optimism about Côte d’Ivoire’s performance and direction.

Colaiuta said: “All the indications are that Côte d’Ivoire has the capacity to improve and go beyond its achievements of recent years.”

Côte d’Ivoire is also the seat of the supranational court of the Organisation for the Harmonisation of Business Law in Africa (l’Organisation pours l’Harmonisation en Afrique du Droit des Affaires – OHADA).

OHADA was established to harmonise commercial laws across 17 West and Central African nations. The organisation came into being with the signing of a treaty in October 1993. According to a World Bank report published last January, OHADA is encouraging reform that will “have a truly transformative impact in the OHADA countries”.

The African Development Bank is due to return to Côte d’Ivoire capital Abidjan this year.