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COTE D'IVOIRE

Sekondi Accra

Even though former president Laurent Gbagbo was purported to be on the losing end of recently held elections, he had to be forced from from office because he refused to relinquish the presidency. He is presently incarcerated while awaiting trail before the International Criminal Court (ICC). The current president, Alassane Ouattara, had to be placed under the protected guard of United Nations (UN) troops at an undisclosed compound while the issue was decided through force of arms. Even though there was strong international pressure from United States President Barack Obama and others for Gbagbo to step down but he refused. The country was on the verge of civil war with thousands of refugees fleeing into neighboring Liberia before Gbagbo relinquished power. There were conflicting news reports which ascertain that western powers, especially France, were dissatisfied with the election results because they favored Ouattara, whose wife is French, and who has a working relationship with the President of France, Francois Mitterrand. Some political analysts state the current North Atlantic Treaty Organization (NATO) and French intervention into Cote D'Ivoire's election process is nothing more than western power's attempt not only to gain a political foothold but also to exploit the country's natural resources for financial gain.

Before the present turn of events, Cote D'Ivoire was faced with the problem of developing economic strategies which would entice international investors. Unchecked racketeering is bleeding the economy and the country also needs to vastly improve its infrastructure. The world's largest cocoa producer was fortunate that record cocoa prices served to cushion the impact of electrical blackouts, decreasing oil production and political demonstrations. But even that bit of good financial fortune was not enough to translate into investments that would reverse declining yields exacerbated by structural mismanagement. Before Gbagbo's intransigence, Cote D'Ivoire was trying to position itself to qualify for debt relief from the International Monetary Fund (IMF) and World Bank.

The government had missed six election dates since Gbagbo's mandate expired in 2005. A large voter turnout of 80% exhibited how committed Ivorians are to progress. The key to the country's stability now rests with a successful resolution of the current crisis which may further increase the de facto divisions that already exist between its northern and southern zones. Gbagbo's loss at the polls much have come as a stinging rebuke because he was able to dictate terms in the run-up to elections due to the seemingly poor organization of the opposition party, Rassemblement des Houphouetistes pour la Democratie et la Paix. Futhermore, despite a pre-electorial pact with Ouattara, Gbagbo's military supporters were campaigning throughout November 2010 to attract elements of Henri Konan Bedie's Parti Democratique de la Cote d'Ivoire. The current political and social situation is further complicated by the position of Forces Nouvelles (FN) rebels. Under a 2007 peace deal, government forces had been gradually redeployed to the north, but rebels have maintained effective control of the area. Who will they ultimately support: Gbagbo or Ouattara?

There were indications before the elections that the political road to the polls was going to be tumultuous. Gbagbo's dissolution in February 2010 of the electorial commission on the specious claim that its director had attempted to inflate the electorial roll with opposition supporters led to riots that left at least 13 people dead. Before that decision, sporadic outbursts of protests occurred intermittently only to quelled by government forces. In August 2010 the UN Mission to Cote D'Ivoire took the unprecedented action of recommending that the UN Security Council ease an arms embargo imposed since 2004. Then Defense Minister Michel Amani N'Guessan posited that the security forces needed to anti/riot and crowd/control equipment. The government echoed this belief once again in September 2010 when the US Federal Bureau of Investigation (FBI) officials uncovered a plot an arrested an Ivorian army colonel who was attempting to purchase arms and ammunition worth over $3.5 million dollars. At the time of the colonel's arrest, the arms embargo was still in effect. However, now that Alassane Ouattara has gained the presidency, the arms embargo may soon be lifted.

Before the post election turmoil, Cote D'Ivoire's economic prospects were mixed. In May 2010, the African Development Bank convened its annual meeting in its former seat in Abidjan, signaling its intention to return once npresent conflicts were resolved. Foreign investing was not possible during the post election unrest and when it was possible, a French headed scheme that shared the risk of bank lending was halted after the February 2010 banking crisis. Inflation reached 2% in 2010 and government revenue was projected at $4.6 billion dollars before internal chaos materialized. The International Monetary Fund (IMF) predicted a real growth rate of 3% in 2010, increasing to 4% in 2011. The rise was supposed to help offset the number of people who lived below the poverty level, which increased from 39% of the population in 2001 to 49% in 2008.

Before the election trauma, IMF stated that Cote D'Ivoire's external debt of $12.5 billion dollars was "unsustainable". Paris Club creditors cancelled $845 million dollars of debt in 2010, but failures to hold elections and delays in implementing cocoa reforms held up over $2.9 million dollars in debt relief form the IMF and World Bank. The government was able to maintain broad macroeconomic stability along with increased budget transparency, but neither of these accomplishments stopped the IMF from witholding a third credit-facility loan in September 2010. It reasons for doing so cited: corruption in the judiciary, imbalances in the electricity sector and an unsustainable government wage bill.

Due to delayed elections, the government had to put critical cocoa reforms on hold. Changes by the IMF and World Bank included a new regulatory framework and the imposition of taxes that were to be no higher than 22% of the international market price. Some reforms were enacted in October 2010, cocoa authorities set the primary export tax for the 2010-11 season at 14.6% of the international market price. this marked the first time since liberalization in 1999 that the levies would not be applied as a fixed total. The government was also supposed to apply a new levy to fund additional reforms. The tax was supposed to finance the implementation of a foward selling system that would have buoyed the government's reserves in the event of a decline in international prices. Economic prognosticators expected the the main cocoa crop for 2011 to decrease by 10% from 2010's 1.2 million tons, which was commensurate with the 2009 harvest, which was the worst yield in five years.

Disease prone-crops coupled with outdated farming methods compounded by aging trees served to reduce production from the country's 700,000 small farms. Government attempts to alleviate the swollen-shoot virus have been mediocre and riddled with corruption. Given the present environment of civil unrest, Ghana stands to become the largest cocoa supplier in the world if it can increase output by about 1 million tons by 2015.

The country is laden with abundant natural resources. In 2010, Cote D'Ivoire and Ghana argued following the discovery of deepwater oil deposits on both sides of the maritime border. They have ultimately decided to create a joint committee to resolve future disputes. Petroleum production was forecast at 17.9 million barrels by the end of 2011, down from 21.9 million barrels in 2009. The mining sector is the focus to diversify away from cocoa and petroleum. The plan before the election turmoil was to increase the mining sector's contribution to GDP to 10% by 2020, up from the current level of 1.5%. The government issued approximately 200 of the outstanding 260 mining permits during the past two years. Gold production was forecast to triple to 20 tons annually by 2015, increasing from 7 tons, as new mines were opened in the north. Cote D'Ivoire had requested for a UN sanctioned ban on the sale of diamonds to be curtailed. The mines, all located in the rebel occupied northern territory, produced approximately 300,000 carats annually, generating tax revenues of $20 million dollars. With so much wealth on the table, one can easily see why Gbagbo was reluctant to relinquish the presidency.

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Cote d'Ivoire maintains an embassy at 3421 Massachusetts Avenue, NW, Washington, DC 20007; tel: 202-797-0300.
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