It was a relatively discreet conference which was held on Thursday April 25 at the Hôtel Ivoire in Abidjan: a room of modest proportions, only two ministers among the panelists and limited media coverage. However, the annual “Country Risk” conferences of the pan-African rating agency Bloomfield Investment Corporation, based in the Ivorian metropolis, have since 2017 been an expected event to situate the state of the continent’s economies.
The report published on this occasion is intended to establish “an investment risk map” by combining the analysis of the performance of public finances, the financial system and the socio-political risk of the country. Criteria on which Côte d’Ivoire proved to be generally performing well in 2023, according to Bloomfield which gives it a score of 6.5 out of 10, up slightly since 2022 (6.2), and says “recommend investment in the country “.
But the president of the agency, Stanislas Zézé, also highlights the weaknesses of the Ivorian economy and the regression of its human development index, raising doubts about the capacity of Côte d’Ivoire to maintain its growth on the long term. An analysis which aroused a touch of irritation from the Minister of Planning and Development, Nialé Kaba, seated in the front row of the audience.
On macroeconomic performance, “Côte d’Ivoire is one of the best performing countries in Africa, with an expected growth rate of 7% in 2023,” initially welcomed Stanislas Zézé. But the entrepreneur with the essential red socks also pointed out the vulnerability to the effects of climate change of a mainly agricultural economy. Climate disruption is expected to cause Côte d’Ivoire to lose 3 to 4.5% of its GDP per year on average, according to government projections for the period 2020-2030, a figure that could even exceed 12% of GDP by 2050.
Debt service, “a concern to watch out for”
Industrialization is making “slow” progress, with a sluggish secondary sector driven by the good performance of extractive activity (18.7%). A performance “greatly improved” by the discovery of the oil and gas deposits, Baleine and Calao, reported Stanislas Zézé, which “bring Côte d’Ivoire into the category of major hydrocarbon producers”.
On the management of public finances, the President of Bloomfield welcomed budgetary revenues up 17.4% compared to 2022, but recalled that total debt represented 55.9% in September 2023. “Although the debt total remains below the critical threshold of 70% of GDP, acknowledged Mr. Zézé, debt service in relation to tax revenues is up 68% and becomes a concern to monitor in the short and medium term. » Particularly because less than 10% of workers bear the full tax burden in an economy that is almost 90% informal.
The monetary and financial system is doing very well, on the other hand, with an increase in bank performance of 16.3% compared to the previous year. But, despite three successive increases in key rates by the BCEAO in 2023, inflation in Côte d’Ivoire now reaches 4.4%, well above the community level of 3%. A rate considered “a factor of fragility” by Mr. Zézé.
Not to mention that the level of human development has further deteriorated, moving Côte d’Ivoire from the category of countries with moderate human development to that of countries with low human development. At issue: the drop in the schooling rate of children, a “suffering” health system with a “serious shortage of medical equipment” and a deficit of qualified nursing staff, contributing to the one-year decline in life expectancy at birth.
A “mostly stable political climate”
In terms of the business climate, Côte d’Ivoire has made progress in its fight against corruption, according to the Transparency International ranking where the country’s index increases from 37 out of 100 in 2022 to 40 out of 100 in 2023. If institutional reforms have been carried out in this direction, this progress is illusory, Stanislas Zézé suggested, as long as the structures concerned, in particular the High Authority for Good Governance, remain subject to power.
As for the security situation, it seems controlled, with a very low index – 1.1 out of 5 –, “which constitutes a highly secure environment”, welcomed Mr. Zézé, despite “some concerns regarding the risks in the north “. The United States, whose ambassador was present in the room, recently alerted the Ivorian authorities to the risk of a jihadist attack near the northern border, a threat which “must be taken very seriously”, believes Stanislas Zézé.
But it is on the analysis of socio-political risk that Bloomfield’s report was most anticipated. If Stanislas Zézé initially recognized that “the political climate remained largely stable”, he also expressed doubts about its viability as the 2025 presidential election looms. “The history of this country has shown that elections , supposed to be banal acts of democracy, become moments of risk,” he lamented.
The reason, according to him, is the “choice of our political model” where powers have been concentrated since independence in the hands of the party in power. An absence of counter-power which creates “an imbalance and frustrations” and “leads to risks of authoritarian government, corruption and favoritism”, warned Mr. Zézé.
“Exogenous shocks”: Covid and war in Ukraine
While the scenario of Alassane Ouattara’s candidacy for a fourth term is already stirring debates, “the prolonged retention of a president at the head of a political party can generate risks of political stagnation and weak democratic renewal” , details the Bloomfield report. A situation which could lead to “increased polarization of society” and “political tensions”, insists the report, especially if electoral processes “are not perceived as transparent and fair”. The whole thing could “compromise investor confidence and economic stability.”
The economic stability of Côte d’Ivoire and its long-term resilience therefore once again depend on the test at the ballot box. Because 95% of SMEs contribute to 20% of the country’s wealth, recalled Mr. Zézé, while 5% of multinationals established in Côte d’Ivoire generate 80% of its wealth. “In the event of a prolonged crisis,” he concluded, “the probability that these 95% of SMEs will maintain the economy while the multinationals relocate is rather slim. »
Invited to speak afterwards, Minister Nialé Kaba balked at “certain expressions which, in our opinion, should be reformulated”, while acknowledging that she “essentially agrees with the conclusions of this report”. “Sustained efforts” have been made under the presidency of Alassane Ouattara since 2012, she said, notably on “industrialization”, the reduction of public debt and security risks in the north of the country.
Referring to the successive “exogenous shocks” represented by the Covid-19 pandemic and the Russo-Ukrainian war, the Minister of Planning assured that “the points of fragility mentioned in the report are already the subject of efforts by the government “. She also expressed “her astonishment and dismay” regarding the decline in the Human Development Index (HDI), of which she said she was unaware.
A decline, however, already indicated by the latest global report from the United Nations Development Program (UNDP) on human development, where Côte d’Ivoire fell between 2021-2022 and 2023-2024, from 159th to 166th place. , out of 193 states assessed.