Ivory Coast Economy Set to Grow in 2015

According to the International Monetary Fund, Ivory Coast’s economy will grow 7.9 percent this year, followed by over 7.0 percent for 2016 and 2017. However, the government expected a greater range of 9.0 percent growth.

According to the International Monetary Fund, Ivory Coast’s economy will grow 7.9 percent this year, followed by over 7.0 percent for 2016 and 2017. However, the government expected a greater range of 9.0 percent growth.

The IMF tempered growth expectations due to upcoming elections and investor uncertainty. Many investors stood on the sidelines to see the results of the election, but the business community is expected to be more engaged in the West African country in the coming years. However, the IMF felt this was an uncertainty, and it was not factored into the equation. President Alassane Ouattara is to win the election in October. Ouattara helmed the new government as the country suffered from a conflict that lasted over a decade, but peace was reached in 2011. Ouattara has expanded trade and increased spending in other sectors of the economy aside from agriculture. Ivory Coast is not only the world’s largest cocoa producer, but a great degree of its economy thrives on agriculture. Ouattara sought to diversify the economy, which is why his leadership is also known for infrastructure investment and attracting investors. Officials submitted a letter of intent to the IMF, stating that the government planned to boost investment spending by 18.6 percent GDP for 2015, an increase from 10.8 percent for 2014. With that being said, investment spending is not coming without a cost.

The government borrowed more money to pay for investment projects, including an upgrade of a power facility that proved costly. Ivory Coast will carry around 43 percent of GDP in the near future, according to IMF figures, and the debt service cost will increase from 10.8 percent last year to 13 percent this year. IMF data also suggests a current account deficit of 2.6 percent of GDP in the medium term. Regardless of the debt increase, Ivory Coast’s future looks positive over the long-term, and the IMF projects that inflation will come to a sustainable 2.0 percent for the year. Unknown factors could hamper the nation’s progress, such as crop failures stemming from inclement weather, and failures in electricity generation. The IMF is also concerned about the extra spending needed to finance projects throughout the country.

Other unknown factors are the country’s vast natural resources that have remained untapped because of the nation’s strong reliance on agriculture. Ivory Coast carries such natural resources as iron ore, gold, bauxite and manganese. Industry minister Jean-Claude Brou stated that gold mining can be a lucrative venture for his country, and the government is interested in further expanding this sector for development.