Overview

Context: The socio-political situation has improved substantially since the 2011 Article IV Consultation, but significant challenges remain. Boosted by a surge in public investment, economic activity rebounded quickly from the post-election crisis in early 2011. Since end-2011, the focus of policy has shifted from short-term crisis recovery to implementation of policies to promote high and inclusive growth. Côte d’Ivoire reached the HIPC Initiative Completion point in 2012. Article IV discussions: The discussions focused on policies needed to achieve the objectives of the government’s 2012–15 National Development Plan (NDP): high growth and reducing poverty. Key policies are additional improvements in the business climate and governance, as well as further efforts to create fiscal space, reinforce the financial sector, and maintain external stability, while preserving the stable macroeconomic environment. Outlook and risks: The medium-term outlook is positive, with robust growth projected in the years ahead. Sustained reform efforts remain needed to maintain high growth rates over the medium term, and improve Côte d’Ivoire’s living standards, which have deteriorated significantly since the late 1970s. A slowing down of reform efforts would result in weaker economic growth. External risks include higher financing costs following the end of an accommodative monetary policy in the US. Exchange restrictions and regime: Côte d’Ivoire, a member of the WAEMU, has accepted the obligations under Article VIII and maintains an exchange system free of restrictions on the making of payments and transfers for current international transactions. The WAEMU’s exchange regime is a conventional peg to the euro. Program performance has been good: All quantitative performance criteria and indicative targets at end-June 2013 were met. While considerable progress was made in key structural reform areas, a few structural benchmarks were met with delays, and others missed. Staff supports the completion of the fourth review under the ECF and the authorities’ request for an increase in the program’s limit on new nonconcessional external debt to make room for the issuance of a Eurobond in an amount equivalent to US$500 million. Completion of the review will result in disbursement of an amount equivalent to SDR 48.78 million under the ECF arrangement.

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