5 October 2012

Cote d'Ivoire - Back On Track?

Photo: Monica Mark/IRIN
Cote d'Ivoire is one of the leading cocoa-producing countries in the world.

Two years after the country's descent into violence, business outlooks are mixed in Cote d'Ivoire.

Two years after Cote d'Ivoire tumbled into a lengthy post-election feud, economic prospects are lifting. The IMF raised growth estimates to 8.6 percent growth this year, and donors have scrapped $10 billion of debt. This October, Cote d'Ivoire and the EU enter the International Cocoa Agreement bringing the world's biggest exporter and importer into a convention to promote transparency and open trade in the sector.

Businesses hope for a new dawn. "We were highly affected by the conflict, because we had some workers killed on the premises," recalls Jean-Louis Billon, chairman and CEO of Sifca Group, an agro-industrial firm part-owned by Singapore's Olam International and Wilmar International. But work is getting back on track "very quickly," he says.

"The first decisions from the [Alassane] Ouattara government were good for business in terms of controlling the administration and giving the private sector some air to breath, in terms of tax breaks," says Mr Billon. President Ouattara, a former IMF official, "knows financial issues very well" says Mr Billon, and the government is favourably inclined to the private sector.

But the country is not in the clear yet. "We still have some political tensions due to the fact that the former regime's people do not want reconciliation to be smooth. This tension is slowing down business," says Mr Billon.

Companies cannot stand aloof, least of all from the xenophobia and tribalism which fuel the unrest. Under the post-independence leadership of  Félix Houphouët-Boigny, Cote d'Ivoire had a liberal migration policy. When growth stagnated in the 1990s, racial and tribal conflict over land, resources, jobs and government posts intensified. Ouattara was even blocked from standing in previous elections on account of his Burkinabe roots.

Businesses are entangled in this legacy. "I don't pay attention to where workers are coming from. What I'm looking for are skills," declares Mr Billon. But he acknowledges that Sifca has to be careful to avoid having employees "from only one tribe".

But the risk of war is limited, he predicts, and the time is right for investors. "They should come. As a matter of fact, over the last year we have had a lot of visits from investors and they have seen the potential".

Others are sceptical. "The winners of the election are in power and the opposition are armed," shrugged one industrialist on the sidelines of the OECD-Africa conference in Paris yesterday. Plots to overthrow Ouattara have already been hatched and foiled, with cross border raids launched from Liberia and displaced malcontents hiding out in Ghana. Cote d'Ivoire's future is still unwritten.

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