Ivory Coast Joins Ghana in Seeking IMF Bailout; Blames Covid, Russia-Ukraine War For Its Woes

The government of Alassane Ouattara has formally met an International Monetary Fund (IMF) team in Yamousokro, the capital of Ivory Coast, to plan the conditions of a bailout it is seeking.

The Ivorian government has requested US$2.6 billion from the Fund, claiming that it has yet to recover from the "pressures of the Covid-19 outbreak" and the "ripple consequences of the Ukrainian War."

The IMF stated that it will assist the government of Ivory Coast in "increasing tax mobilization to ensure macroeconomic stability and generate budgetary flexibility for important social expenditure, security, and investment needs."

Vice President Tiémoko Koné, Prime Minister Patrick Achi, Minister of State and Agriculture Kobenan Adjoumani, and Minister of Planning made up the Ivorian delegation to the IMF.

“Discussions on a new blended financial arrangement under the Extended Fund Facility (EFF)/ Extended Credit Facility (ECF) to support the authorities’ economic program have been very productive, and I am pleased to announce that a broad agreement has been reached on all policy objectives and reform measures.

“We expect to finalize a staff-level agreement, including on the level of access to Fund resources of at least 300 percent of quota (equivalent to about US$2.6 billion), in the coming days. The final program arrangement would then be subject to approval by the IMF’s Executive Board.

“The Ivorian economy proved resilient to the pandemic, but the economic rebound has softened in the face of adverse spillovers from the war in Ukraine and global monetary tightening.” The fund said.

“Indirect and direct subsidies to curb price pressures, higher security spending, and worsening terms-of-trade amid robust domestic demand have led to a widening of macroeconomic imbalances in 2022.” It added.

“Against this challenging backdrop, the authorities have requested Fund support under a blended ECF/EFF arrangement for their economic program. It aims to preserve fiscal and debt sustainability and anchor the 2021-25 National Development Plan (NDP) in key structural priorities to promote more inclusive growth led by the private sector and facilitate Côte d’Ivoire’s transition towards a middle-income country.

”The IMF staff supports the priorities of the authorities’ program. Discussions focused on boosting revenue mobilization to preserve macroeconomic stability and create fiscal space for critical social spending, security and investment needs.

“Key structural reforms include strengthening social protection for vulnerable households, improving public financial management and investment efficiency, and promoting private-sector led and more inclusive growth by creating new employment opportunities, including for Côte d’Ivoire’s large young population.”