On the road

For many reasons, Africa analysts are saying that the next several months will be pivotal ones in the history of Côte d’Ivoire. For the first time since a brief but bloody civil war in 2002-03 split the country in half, dividing it into zones dominated by forces loyal to Ivorian president Laurent Gbagbo and the Forces Nouvelles anti-government rebels, a peace process has moved forward into a power-sharing agreement.

After negotiations concluded in Burkina-Faso’s capital Ouagadougou in March, Forces Nouvelles secretary general Guillaume Soro now sits in the prime minister’s office in the country’s economic (and defacto political) capital of Abidjan. Many hope that the other key tenets of the Ouagadougou agreement, including the disarming of rebel groups and pro-government militias, and the issuing of identification cards to tens of thousands of previously excluded voters, will be rapidly implemented ahead of general elections tentatively slated for 2008, opening the way for a resurgence of what was once west Africa’s economic crown jewel.

“We’re very much in limbo in Côte d’Ivoire and it’s very difficult to predict the way things will go,” says Daniel Balint-Kurti, an analyst focusing on Côte d’Ivoire at Chatham House, a British foreign policy institute.

Although some observers of the region’s chaotic political scene are sometimes wont to lump Côte d’Ivoire in with other failed states in an area that has seen more than its fair share of conflict in the past decade, it is important to recall that, despite its recent state of upheaval, things were not always thus in the country.

National development

Under its former president the late Félix Houphouët-Boigny, who ruled the country from its independence from France in 1960 until his death in 1993, Côte d’Ivoire’s economy flourished, growing at an annual rate of nearly 10%. Mr Houphouët-Boigny’s government welcomed immigrants to help speed along national development; thousands of people poured in from Burkina-Faso, Guinea and Mali to join the country’s indigenous citizens and long-standing European and Arab populations.

The economy appeared so resilient, in fact, that observers often marvelled at what they called “the Ivorian miracle”. But after Mr Houphouët-Boigny’s death, things took a turn for the worse.

Prices for cocoa and coffee, the backbones of the Ivorian economy, began to teeter in the 1980s, and the country experienced its first ever military coup in 1999, led by former military commander Robert Guéï (later killed in the first hours of the civil war). Tensions between residents of the western and northern regions of the country, where many immigrants had settled, and those in the south and the east worsened, spurred on by the nefarious rhetoric of Ivoirité – a definition of national identity that many took as an attempt to disenfranchise those with immigrant backgrounds from the political process.

These and other tensions helped to set the country on the course that led to its eruption into insurrection five years ago. But now, some hope, the nation is turning a chapter on its dark recent past.

Economic sparks

After watching Côte d’Ivoire’s gross domestic product (GDP) growth slide into negative territory in recent years and incomes fall by 15%, amid all the talk of peace and reconciliation, the economy of this resource-rich state has recently begun to show some life. GDP growth is expected to rise 1.7% this year, according to the International Monetary Fund. Ivorian finance minister Charles Koffi Diby recently suggested that growth could be as high as 2.5%.

The country still has a robust university system that turns out about 500,000 graduates each year with degrees in fields such as arts, sciences and technology, and its literacy rate of 50%, while far from ideal, nonetheless compares favourably with those of neighbouring countries, such as Mali (46.4%) and Guinea (29.5%).

At the international level, Côte d’Ivoire has maintained a conscientious programme of debt issues on the domestic bond market and severely reigned in state spending to address its debts to multilateral lenders, like the World Bank and the African Development Bank. The country’s foreign debt stands at CFA Fr8000bn ($18bn), four times Côte d’Ivoire’s annual budget, while its domestic obligations tally in at about CFA Fr325bn .

Industrial fortitude

Even in the face of recent conflicts, Côte d’Ivoire continued to supply nearly 40% of the world’s cocoa; three to four million of the country’s 18 million population work in some aspect of the industry. Annual proceeds in the government-controlled southern zone are estimated by the Ivorian treasury to run at about $1.4bn; in the northern rebel-controlled sector estimated annual cocoa revenues are thought to be about $30m. Should the country reunify, there would seem to be room for cocoa and other industries (such as the ever-lucrative export of essential oils) to expand still further.

Côte d’Ivoire’s private sector, for its part, is eagerly anticipating that longed-for stability. “We have a major private sector here in Côte d’Ivoire,” says Guy M’Bengue, managing director of the Association pour la Promotion des Exportations de Côte d’Ivoire (APEX-CI). “There’s a lot of potential in terms of human resources and in terms of infrastructure compared with other countries. Of course, this infrastructure must be maintained and upgraded, but we have the basics.”

Variable infrastructure

Although parts of the rebel north, such as its power base of Bouaké, have a slightly ramshackle air, in the economic hub of Abidjan in the south, visitors speed along good roads lit by steady supplies of electricity, passing gleaming high-rise office buildings bustling at ground level with non-ubiquitous (at least in west Africa) amenities, such as sushi restaurants and supermarkets stacked to the rafters with products from across Africa and Europe.

Through it all, Abidjan, once called “the Paris of west Africa”, has retained its status as the nation’s first city. The nation’s official capital, Yamoussoukro, located in the central region, is still perhaps uncomfortably close to the epicentre of conflict, being little more than half an hour away from the first rebel roadblocks on the way to Bouaké.

Anxious to wean its economy off cocoa-dependence, Côte d’Ivoire’s oil sector is rapidly expanding. The International Monetary Fund recently affirmed that the sector would help to boost Ivorian exports over trend levels in the next three years. Also, the country’s maritime officials are planning a vast expansion of Abidjan’s state-controlled port, the largest in west Africa.

“There’s big potential in the oil sector, and we expect that the government will take it seriously because it will be another pillar of our economic environment,” says Mr M’Bengue.

The country’s burgeoning telecoms sector, dominated by Orange Côte d’Ivoire (a subsidiary of the Orange brand of France Télécom), has seen marked growth since its arrival on the scene in 1996, with about five million of the country’s citizens now counted as regular mobile users.

New entities, such as the Village de Technologies de l’Information et de la Biotechnologie (VITIB), a free trade zone for biotechnology, information technology and telecoms companies, also show the country’s desire to diversify its economic system. New investment codes and existing economic mandates, such as the Free Trade Zone law, specifically aimed at attracting foreign investment, are designed to help such new economic engines achieve their goals.

Corruption crackdown

Mr Gbagbo’s announcement in late October that the government had begun an investigation into possible corruption in the country’s cocoa trade was welcomed. Following his inauguration as the country’s president in 2000, a quartet of cocoa institutions began operation in addition to an existing body to regulate the cocoa trade and ostensibly support the country’s cocoa farmers. An ensuing multiplication of taxes levied on the exported cocoa crop resulted in imposts for the 2006-07 harvest measuring CFA Fr49.11 (10 US cents) per kilo, up sharply from CFA Fr15.5 in 1999.

There are still hurdles to overcome. Following the civil war, the country’s economic system was effectively split in two, with no goods for export being permitted to flow south – instead being rerouted through neighbouring countries like Togo and Guinea.

A body known as the Centrale serves as the economic and financial management structure of the Forces Nouvellas zone. “My role consists of implementing models of economic policy that allow businesspeople to operate and the Centrale to make some money so it can carry out its mission,” says Professor Andre Ouattara, the director of the Centrale, interviewed in his office in the rebel stronghold city of Bouaké. That mission includes keeping the Forces Nouvellas fed, clothed and armed.

Signs of the fragility of the peace process are, likewise, not hard to come by. Attending a disarmament ceremony in Bouaké in July, Mr Gbagbo declared: “People of Côte d’Ivoire, the war is over.” Yet only the month before, while attempting to land in the northern rebel redoubt, Mr Soro’s plane came under heavy fire in an attack that left four dead, though Mr Soro was unhurt. No-one has claimed responsibility for the attack.

There is still concern that any economic revival should come hand-in-hand with a comprehensive political settlement. “People are fed up, they got to the height of the horror and they are looking for real peace,” says Francis Akindes, a professor of economics who taught at the University of Bouaké before its destruction at the outset of the war.

“They jumped into the Ouagadougou Agreement because it offered a ceasefire, but the real problems that caused the war have never been solved,” says Mr Akindes, who also serves as an associate researcher affiliated with the Institut de Recherche pour le Développement in Paris.

Nevertheless, Côte d’Ivoire’s business sector appears eager and willing to help usher the country into a new era of peace and prosperity, and to address some of the problems that have plagued the country in the past. Organisations such as APEX-CI have been enthusiastic signatories of the United Nation’s Global Compact, a 10-point framework that focuses on good governance and business practices, with a particular focus on anti-corruption and transparency.

Certainly, the road ahead is fraught with obstacles, but if Côte d’Ivoire’s political actors can put the war-making and demagoguery of the past behind them, they have the best chance since the death of Mr Houphouët-Boigny to push their country over the edge from a potential to an actual economic success story, bringing jobs and wealth to their citizens, attracting foreign investment and building a country of which Ivorians could be proud.

COUNTRY FOCUS

CôTE D’IVOIRE

Population: 18 million

Pop. growth rate: 1.995%

Area: 318,000 sq km

Real GDP growth (2006): 1.2%

GDP per capita: $1600

Current account: $529.1m

Largest sector (% of GDP): Services

Labour force: 6.8 million

Unemployment rate: 13% (urban)

_{Source: CIA Factbook}

KEY FACTS:

In March a power-sharing agreement was forged between President Laurent Gbagbo and Forces Nouvelles secretary general Guillaume Soro, who is now prime minister

GDP growth is expected to rise between 1.7% and 2.5% in 2007

Côte d’Ivoire’s universities produce about 500,000 graduates each year

During the civil war, the country still produced 40% of the world’s cocoa; three to four million people work in the cocoa industry

The oil and telecoms sectors hold huge potential for expansion