Country Report Cote d'Ivoire August 2008

Outlook for 2008-09

• The holding of the presidential election, scheduled to take place on November30th, will continue to be a necessary condition for improving pol-itical stability, as it is intended to bring an end to the country's political crisis.
• Political instability may continue after the poll if there is widespread electoral fraud or if the main political parties do not accept the results.
• As long as the political crisis continues, economic policy will focus on keeping the economy afloat, leaving long-overdue reforms to the next government.
• Assuming that political stability improves, real GDP growth will rise by a modest 2.5% in 2008 and 3.8% in 2009, supported by a recovery in the oil sector and the peace dividend.
• Inflation is forecast to rise to an average of 5% in 2008, in line with higher world food and energy prices, before declining to 3% in 2009 as food and energy pricesfall.
• The current-account balance is forecast to turn into a surplus equivalent to 4.7% of GDP in 2008 and 4.6% of GDP in 2009 owing to a widening trade surplus supported by high commodity prices.

Monthly review

• The company overseeing voter registration and the creation of a new electoral roll, Sagem Securite, has presented its operational plan to the government, amid fears that the process will not be completed in time for the election.
• Mr Gbagbo has threatened to reshuffle the government if cabinet members from some political parties continue to criticise the government's actions.
• The integrated central command (ICC) has held its first talks with pro-goverment militias in the west of the country to start their demobilisation.
• The country has been paralysed by protests over high fuel and food prices, which were triggered by the government's decision to end fuel subsidies.
• The government has been forced to introduce emergency measures, resuming subsidies for diesel and paraffin and increasing transport allowances.
• The estimated cost of these measures, CFAfr200bn (US$484m), is to be financed by reducing spending in non-essential areas such as administrative costs and international travel.
• Work has started on a project to extend the warehouse storage capacity of the infrastructure used by Mali at Abidjan's port.
• Several companies have relinquished licences in Cote d'Ivoire's offshore area following disappointing seismic studies.

Source: Country Report