In recent years, Côte d’Ivoire has performed better in macroeconomics and in the management of its public finances compared to what was forecast in the economic and financial framework established with the IMF and the World Bank in 2011.
In effect, the real growth rate of GDP reached 9.8% by the end of 2012, as opposed to an initial projection of 8.1% growth. Thus, the country has recorded its highest growth rate in over a decade and in turn has displayed a strong capacity for wealth creation. By comparison, the average growth rate in Africa was approximately 6% in 2012.
Inflationary pressures have been limited, following the historical tendencies of restrained consumer price rises in the Economic Community of West African Nations. In 2012, average inflation in Côte d’Ivoire was 1.3%, notably thanks to improvements in distribution systems, such as agricultural infrastructure, and to measures the government took to combat price rises.
Budgetary execution resulted in an overall deficit that was more modest than was initially projected, and the overall budget balance came out at -3.4% of GDP, as opposed to the forecasted -4.3%. All the performance criteria of the economic and financial programme were met at the end of December 2012, which explains continuing disbursements by the IMF.
This performance is the result of the combined effect of a raft of measures and policies implemented by the government. Thanks to the efforts of bilateral and multilateral partners, the weight of external debt on public finances, which was compromising growth and the implementation and execution of viable public investment policies for the past 30 years, has been considerably reduced. Thus, after attaining the HIPC completion point in June 2012, external debt – excluding the Contracts of Deleveraging and Development with the French government, which constitute loan-funded investments with a measurable and direct impact on the population – represented only 19% of GDP at the end of 2012, against 67.9% in 2007.
Policies put in place by the government have focused on normalising the security situation, boosting economic growth based on a substantial increase in public and private investment, and improving the overall business climate. The 2012-15 National Development Plan (NDP) is key to establishing these policies and represents approximately $22bn. The NDP is part of President Alassane Dramane Ouattara’s ambition to make Côte d’Ivoire an emerging country by 2020 as well as to reduce the poverty rate by half by 2015.
Projections based on the NDP have predicted GDP growth rates of 9% in 2012, and 10% in 2014 and in 2015. These projections, which are founded on expected improvements in agricultural, mining and mineral, take into account our broader efforts to improve the business climate. This in turn should result in an increase of private investment that would represent at least 60% of total investment spending during this period. True to Côte d’Ivoire’s liberal economic tradition and outward openness, the reforms aim to reinforce the private sector’s role as the principal growth driver.
On this basis, the overall investment rate is predicted to jump from 12.7% of GDP in 2012 to 23.5% in 2015, which would be close to the levels from the 1970s, characterised by Côte d’Ivoire’s economic boom. For the 2013-15 period, investments to be made amount to CFA9.5trn ($19bn), of which CFA4.2trn ($8.4bn) is to be taken on by the public sector and CFA5.3trn ($10.6bn) is expected from the private sector. Most notably, the sectors most targeted by private investment are mining, energy, agro-industry and construction, particularly roads, bridges, airports, seaports and railroads. The investment policy, which relies on the promotion of public-private partnerships, is designed to satisfy internal demand for infrastructure but also to accelerate regional integration. The objective is to encourage the free circulation of goods and persons in the framework of a viable economic space.
Adapted from a speech given to the Diaspora for Growth Forum in Paris, France on June 22, 2013.
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