On April 11, 2011 former Ivorian President Laurent Gbagbo was toppled and subsequently placed under house arrest in northern Cote d’Ivoire, marking an end to an intensely violent post-election crisis that lasted five months and claimed over 3,000 lives since results were announced on December 2, 2010. His rival, Alassane Dramane Ouattara, was sworn in as head of state on May 5, 2011 by the same Constitutional Council which had initially invalidated the vote tally published by the National Independent Electoral Commission. According to the commission, Mr. Ouattara won over 54 percent of votes cast.

Côte d’Ivoire, a medium-size country with a population estimated at 21 million, is the second largest economy in West Africa after Nigeria and is critical to the overall development of the sub-region. Despite its economic potential, years of political and military crisis, punctuated by a brief armed conflict that divided the country in 2002, and poor governance have taken a heavy toll on the country, transforming the once-model African nation into a fragile state in a constant struggle for a better future.

Economic Overview

Prior to December 2010, the economy’s performance in 2010 has been broadly satisfactory despite the global economic slowdown. Cocoa prices were at historic highs and oil exports have also been strong. However, GDP growth was expected to slow down from 3.8 percent in 2009 to 3.0 percent in 2010 due to problems in the electricity sector which have hampered manufacturing output, as well as declining productivity in the cocoa sector, and limited private investment until after the elections are over. The electricity sector has a deficit projected to surpass CFAF 100 billion in 2010 (about US$200 million), the result of emergency measures taken to deal with rolling blackouts experienced in the first quarter of the year. The Government had also made progress on the Heavily Indebted Poor Countries (HIPC) Completion Point triggers and prior to the election crisis it was expected that the authorities would reach HIPC Completion Point by mid 2011.

 

In the wake of post-election violence, the World Bank closed its office in Abidjan and froze disbursements, as did other development partners. The return to normalcy since the swearing-in of Mr. Ouattara as president, coupled with the repayment of debt arrears of Cote d’Ivoire’s debt arrears, cleared the way for reengagement with the World Bank, starting on May 15, 2011.

In June 2011, the World Bank's portfolio in Cote d'Ivoire - which has a dozen projects totaling nearly US$750 million (of which US$240 million remain undisbursed) - should be revived and adapted to the new socio-political and humanitarian context.

As a fragile post-conflict country, Côte d’Ivoire receives an exceptional level of grant financing from the International Development Association (IDA), the concessional development financing arm of the World Bank Group. The IDA portfolio currently comprises 10 investment projects, representing commitments of US$737 million, with an undisbursed balance of US$245 million. This financing (mostly grants) is supporting government reforms to strengthen economic governance in key sectors of the economy (cocoa, energy, financial) and management of public resources and public procurement, reintegration of ex-combatants and youth at risk, emergency community and urban infrastructure rehabilitation, and other activities to re-launch the economy and basic services throughout the country.

Pipeline

In fiscal year 2011, as part of a new Country Partnership Strategy for Côte d’Ivoire, the Bank had been preparing two IDA operations to present to the Board: a US$50 million Youth Employment and Skills Development project and a US$70 million Development Policy Operation (budget support) supporting economic governance and recovery. In addition, the Bank had allocated about US$15 million in IDA resources for regional operations, for a total IDA financing plan of US$134.5 million to be committed in FY11. Bank financing to Côte d’Ivoire since 2008 is on 100 percent grant IDA terms. The Bank was also preparing an US$80 million Education For All- Fast Track Initiative grant program to be approved this fiscal year (by June 30, 2011).The Bank is also completing a study on sources of growth, a poverty analysis and a survey of the investment climate. These activities are on hold pending resolution of the election-related crisis.

International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA) Portfolio

The IFC’s current total committed portfolio is US$70 million. The largest investments are a US$48.7 million equity investment in Devon Energy Côte d’Ivoire (oil and gas) and a US$13.3 million loan to the Azito power station. MIGA’s existing portfolio consists of one agribusiness project in the cocoa sector. The current gross outstanding exposure from this MIGA investment is $1.67 million.

World Bank Institute (WBI)

In FY 2010, WBI implemented its Strategic Renewal with a focus on seven cross-cutting themes, including: Fragile and Conflict-affected States; the Global Economic Crisis; Governance; Climate Change; Health Systems; Urban Development and Public-Private Partnerships. Côte d’Ivoire was expected to participate in the joint WBI/AFR Regional Governance for Extractive Industries Program. The program seeks to extend capacity building on revenue stream transparency to other sections of the value chain. WBI and IFC are exploring options for coordinated support to the cocoa sector. WBI was also planning to   look at institutional capacity gaps for potential training support, through its Leadership for Results programs and support for multi-stakeholder coalitions for reform (public/private sectors, civil society, parliamentarians, and media). WBI will help identify and build capacity of local training institutions

 

(Prior to the recent political turmoil)

From the World Bank’s reengagement in July 2009 until November 2010 when the recent political turmoil began, International Development Association (IDA) and Trust Fund support to Côte d’Ivoire achieved the following results:

Stabilizing the situation and assisting the Government to address key conflict factors

• Through the Post Conflict Assistance Project, economic reintegration services have been provided for almost 15,000 ex-combatants and youth-at-risk prior to the November 2010 post election crisis, providing these beneficiaries with jobs and incomes.
• 250,000 certificates/deeds (contained in 5,000 civil registries) have been salvaged, restored and digitized. Another 36,000,000 certificates/deeds (for 720,000 registries) started to be digitized.  To accomplish this, civil registry offices have been equipped with new computerized systems to ensure that births, citizenship, property, marriage and other life events are properly recorded, stored and available for Government to provide adequate services to citizens.
• The first ever National Civil Registry Archives was under construction to safeguard this information and to help prevent recurrence of abuses which contributed to the outbreak of the civil war. 
• Offices for local government officials were also being rehabilitated to facilitate the redeployment of the civil service across the country as part of the reunification process.
• IDA was providing services to clarify land rights and facilitate conflict resolution and has provided protection and treatment to some 2,000 women survivors of gender-based violence.

Assisting war-affected populations

• The IDA education project have  printed 6.5 million text books for primary school students, 244,000 teacher guides, and 87,000 teacher training guide for the 2010/011 school year. In response to the food price crisis, the project provided school meals to 68,000 students in 400 schools in 2009, working with the United Nations World Food Programme (WFP).
• IDA financed 50 community projects, of which 50 percent are health dispensaries and 50 percent schools.
• Transport infrastructure rehabilitation has included: spot improvements on 3,100 kilometers of unpaved roads; rehabilitation of 578 kilometers of unpaved roads; rehabilitation of 134 kilometers of paved road (Abidjan to San Pedro); construction of 50 small bridges across the country (ongoing) and completion of the Dihinibo bridge on the main road in the east.
• The emergency urban infrastructure project has financed more than 1,200 direct jobs with 60 local contractors for rehabilitation works; the project’s “Clean Cities” component has created employment for 2,000 unskilled workers and provided hands-on training resulting in the creation of several formal Small and Medium Enterprises (SMEs).
• Four solid waste SMEs have negotiated services contracts with Abidjan and created 500 permanent jobs.

The Transport sector adjustment project (CI-PAST) has built 50 small bridges to connect isolated communities to the rest of the country and economy.

Assisting economic recovery and reform

• Budget preparation and execution have improved and there were fewer discrepancies between approved budgets and actual expenditures; budget execution is published quarterly and posted on the internet.
• A modern computerized public finance management system (SIGFIP) has been extended to departments outside of Abidjan, including to the CNW as part of the unification process
• Tax burden on cocoa farmers reduced and sector transparency and management improved;
• Government measures to improve revenue have included: (i) improving tax and customs administration, including in the CNW zone; (ii) enhancing the revenue contribution from Reforming  the Cocoa sector ; A major challenge to the country economical recovery
• National oil/gas companies; (iii) reducing tax exemptions; and (iv) ensuring that public enterprises transfer to the treasury all social contributions on wages.
• Energy audits in support of the Extractive Industries Transparency Initiative (EITI) process have been prepared, Government has adopted an electricity sector policy in 2009, and Côte d’Ivoire has joined EITI in 2008.
• Government completed its first full Poverty Reduction Strategy Paper (PRSP) in January 2009 and reached the Heavily Indebted Poor Countries (HIPC) Decision Point in March 2009.

Pending a joint assessment of needs by donors aimed at establishing the actual extent of damage caused by the post-election crisis, it is likely that the crisis will have a dampening impact on attainment of the HIPC Completion Point, which is now scheduled to occur in the second half of 2012.

At the policy level, key donor partners were coordinating around the international consultative body which is attached to the Ouagadougou process (comprising the United Nations (UN), European Union (EU), International Monetary Fund (IMF), African Development Bank (AfDB) and the World Bank) and monitors implementation progress and challenges.

At the technical level, donors coordinated according to sectors with the line ministries as well as by way of a regular Groupe de Réflexion Stratégique, comprising heads of United Nations agencies, key bilateral partners and the international financial institutions (IFIs). The Bank and Fund coordinate closely on dialogue with authorities.

The EU’s program in Côte d’Ivoire is presented in a five-year strategy covering 2009 to 2013. In February 2009, the Bank signed a Protocol of Cooperation with the EU delegate in Abidjan outlining a World Bank-EU partnership for Côte d’Ivoire and establishing complementary roles for the two institutions as well as areas of collaboration over the next four years, including in the areas of i) Governance; ii) PSD; iii) health; iv) education; v) agriculture; and vi) infrastructure (roads and electricity). The Bank is pursuing the same approach with other key donors once they fully reengage, notably Agence française de Développement (AFD, the French development agency) and AfDB.

Although AFD initially linked its reengagement in Côte d’Ivoire attainment of the HIPC Completion Point, in April 2011 the agency extended a €400 million loan to the West African nation in light of the post-election crisis. Half of the money, or €200 million, enabled Cote d’Ivoire to clear two months of salary arrears.

The AfDB prepared a Global Country Strategy Note for 2009 to 2010 which laid out an arrears clearance plan for Côte d’Ivoire (cleared in early March 2009) and a reengagement strategy focused on strengthening economic governance and regional infrastructure (namely electricity and hydropower).

The UN System has a program covering 2009 to 2013 focused on five themes: Consolidating peace and protecting human rights; governance and decentralization; basic social services; economic recovery and food security; and the environment. The UN has provided support for the preparation of the PRSP and works closely with development partners, including the World Bank and IMF, to promote coherence and harmonization.

The Bank planned to work with the government to organize and sponsor a Consultative Group meeting to mobilize and coordinate donor support around the PRSP upon attainment of HIPC Completion Point.

Outside of financing operations, the Bank has also been strengthening partnerships with Côte d’Ivoire’s civil society and private sector through a “Dialogue Series on Development in Côte d’Ivoire.” This provides a forum for debate and exchanging views among community and national leaders on issues critical to recovery and peace-building efforts. The Country Office in Abidjan has been implementing a communications and outreach program with a broad array of stakeholders to further support a peaceful and smooth political transition and economic recovery during and following the electoral period. These efforts seek to raise awareness and understanding of the objectives of the reform program on the part of public opinion leaders while also providing a platform for exchanging views on the country’s priorities. As part of this effort, the Bank prepared a CSO strategy which includes putting in place a network of CSOs representing a broad array of sectors with which the Bank will hold regular consultations on its programs. The country office has also launched a new quarterly magazine, “L’Espoir,” (hope) as part of its outreach effort.