Cote d’Ivoire is heavily dependent on agriculture and related activities that engage roughly two-thirds of the population. Cote d’Ivoire is the world’s largest producer and exporter of cocoa beans and a significant producer and exporter of coffee and palm oil. Emerging from a decade of political unrest, Côte d’Ivoire is contributing significantly to the economic development of the West Africa region due to its geographical location, diverse economy, and infrastructure network. Côte d’Ivoire is one of the largest economies of the Economic Community of West Africa States (ECOWAS) and represents around 40 per cent of the West African Economic and Monetary Union (WEAMU) GDP. There has been a robust recovery of Côte d’Ivoire’s economy in the wake of its 2010 post-elections crisis, with the average real growth rate reaching 8.5% annually between 2012 and 2015. Côte d’Ivoire’s 2015 GDP was US$ 31.75 billion and per capita GDP estimated at US$ 1315. The International Monetary Fund (IMF) forecasts GDP growth to reach 8.5% in 2016 and 7.4 % per year on average in 2017-2020.
In 2017, GDP is forecast to grow by 8% – the fastest rate in sub-Saharan Africa – reaching $38.4 billion. The largest sector in Côte d’Ivoire’s economy, in terms of value added, is the services sector, accounting for almost half (48.7%) of total value added in 2015. In 2011, Côte d’Ivoire fell into recession. Its economy shrank by -4.2% in real terms. This was caused by the political crisis after the 2010 elections, which ended in April 2011. Since then the West African country has been booming. Between 2012 and 2016, its economy grew on average by 8.4% per annum.
Why invest in Côte d’Ivoire?
- The country has preserved its post-2011 political stability and is focusing intently on economic growth in order to become an “emerging” economy by 2020
- Fertile soils for agriculture and natural resources such as petroleum, natural gas, diamonds, manganese, iron ore, copper, gold, nickel
- Relatively well-developed road infrastructure, the second largest port in West Africa, and a modern airport with a reliable national airline, Air Cote d’Ivoire, which services all of the major capital cities in the region.
Côte d’Ivoire is a multi-party democratic republic. Côte d’Ivoire’s recent history has been marked by political turmoil, most notably between 2003 and 2006 during the first Ivorian civil war, and between 2010 and 2011 during the second Ivorian civil war.
In 2002, a civil war divided Côte d’Ivoire between a rebel-controlled North and a government-controlled South, with a buffer zone controlled by UN peace-keeping forces. In 2007 President Gbagbo and Guillaume Soro (former leader of the Forces Nouvelles) signed an agreement in which Soro joined Gbagbo’s government as Prime Minister and the two set out to reunite the country; dismantle the buffer zone; integrate rebel forces into the national army; and hold elections.
Alassane Ouattara won the presidential election in November 2010, but Laurent Gbagbo refused to stand down. A stand-off ensued until April 2011 when Gbagbo’s capture ended the post-electoral crisis in which some 3,000 were killed and thousands displaced. Gbagbo became the first Head of State to be formally charged by the International Criminal Court. The peaceful re-election of President Alassane Ouattara at the end of October 2015 confirmed the country’s stability since the end of the political crisis in 2011. According to The World Bank’s World Governance Indicators, Côte d’Ivoire has improved its score for political stability from -2.3 in 2005 to -0.86 in 2015.
The Mo Ibrahim Index of African Governance is an assessment of the quality of governance in African countries. Côte d’Ivoire’s Index score has improved since 2000, increasing from 39.9 to 52.3. In the 2015 Report, Côte d’Ivoire ranked 21st out of 52 African countries, up five places from its 2014 ranking and 20 places since 2012. In regional terms, it ranked fifth out of 16 west African states in 2015
In 2016, Côte d’Ivoire had an estimated population of 23.25 million which has been growing at an average of 2.32% during the last decade. The population is forecast to increase to 32.14 million by 2030. Like many other African countries, Côte d’Ivoire has a growing youth population. In 2016, 62.65% of the population was under the age of 24. The median age in Côte d’Ivoire is 18.5 years and the population density in Côte d’Ivoire is 75 per Km2 (194 people per mi2).
It is estimated that 51.9 % of the population is urban (12,371,913 people in 2017)
Doing business in Côte d’Ivoire
The highlights of World Bank score of doing business in Côte d’Ivoire is summarised as follows;
|Topics||World Bank 2017 Rank||World Bank 2016 Rank||Change in Rank|
|Starting a Business||50||44||
|Dealing with Construction Permits||182||180||
|Protecting Minority Investors||145||145||–|
|Trading across Borders||150||151||
Moody’s credit rating for Ivory Coast was last set at Ba3 with stable outlook. Fitch’s credit rating for Ivory Coast was last reported at B+ with stable outlook.
Côte d’Ivoire is a member of the West African Economic and Monetary Union (WAEMU), which uses the Franc CFA, a convertible currency. The French Treasury continues to hold the international reserves of WAEMU member states and maintains a fixed rate of 655.956 CFA to the Euro.
The WAEMU has unified foreign exchange regulations. Under these regulations, there are no restrictions for transfers within the community, and designated commercial banks are able to approve routine foreign exchange transactions inside the community. The transfer abroad of the proceeds of liquidation of foreign direct investments no longer requires prior government approval.
Despite the ability to transfer funds freely within the WAEMU zone, when Ivoirians and expatriate residents are traveling from Côte d’Ivoire to another WAEMU country, they must declare the amount of currency being carried out of the country. When traveling from Côte d’Ivoire to a destination other than another WAEMU country, Ivoirians and expatriate residents are prohibited from carrying an amount of currency greater than the equivalent of two million CFA (approximately USD 3,316). Larger amounts require the approval of the Ministry of Economy and Finance, and must be in travelers or bank checks.
There are no restrictions on the transfer of capital, dividends, and income, or on investments funded with convertible foreign currency. Remittances for Ivoirians were about 300 million in 2013 or 1.2 percent of GDP. Côte d’Ivoire is a member of the Inter-Governmental Action Group against Money Laundering in West Africa (GIABA), which is an associate member of the Financial Action Task Force (FATF).
Cote d’Ivoire’s legal system is based on a French civil law model. Côte d’Ivoire has both commercial and bankruptcy laws that address liquidation of business liabilities. In January 2012, the Council of Ministers established a Commercial Court specifically to handle business cases. In April 2013, the government endorsed a draft law to consolidate the autonomy and extend the attributions of the Commercial Court to create the Commercial Chamber of the Court of Appeals. In April 2014, the government endorsed a draft law on judiciary and conventional mediation, which established mediation throughout the Ivoirian legal framework in addition to the Commercial Court and the Arbitration Tribunal.
Côte d’Ivoire is signatory to the Organization for the Harmonization of Corporate Law in Africa (OHADA) that provides for the 16 member states, common corporate law and arbitration procedures
Côte d’Ivoire is a signatory to the International Center for Settlement of Investment Disputes (ICSID) and signatory to the 1958 New York Convention of 1958 on the Recognition and Enforcement of Foreign Arbitral Awards.
The Abidjan-based regional Joint Court of Justice and Arbitration (CCJA) provides a means of solving contractual disputes. The arbitration tribunal formed in 1999 also has the ability to enforce awards more quickly, but the use of the tribunal in lieu of the court system has been limited.
Cote d’Ivoire’s 2012 Investment Code (Article 20) requires that arbitration procedures be submitted to international arbitration under the rules outlined by the 1958 New York Convention and for the enforcement of awards under the ICSID Convention.
Key development challenges
Côte d’Ivoire suffers from weak governance and corruption challenges, and the fact that the country got a setback as a result of political turmoil that resulted in destruction of infrastructure, hence affecting the country’s ability to attract investments
There are domestic laws and regulations to combat corruption, but they are not effectively enforced. Under the Ivoirian Penal Code, a bribe by a local company to a foreign official is a criminal act. Côte d’Ivoire ratified the UN Anti-Corruption Convention in November 2011; however, the country is not a signatory to the OECD Convention on Combating Bribery.
In 2015, Transparency International’s Corruption Perception Index ranked Côte d’Ivoire 107th out of 168 countries.
Côte d’Ivoire’s security has significantly improved since the 2010-2011 post-electoral crisis, although some security incidents, linked to supporters of the former Gbagbo regime, have occurred, mostly in western Côte d’Ivoire. Islamist militant groups active in the Sahel also pose a threat in the region. Cote d’Ivoire suffered its first terrorist attack on March 13, 2016 on the beaches of Grand Bassam, for which Al Qaeda in the Islamic Maghreb subsequently claimed responsibility. With the new re-elected government the country is safe for business and politically stable.
Unemployment and skilled labour
In 2017, there will be an estimated 8.38 million people employed in Côte d’Ivoire, with a labour force participation rate of 67%. Of those employed, approximately 62% are male and 38% female (ages 15+). The total number of people employed in each broad sector has increased annually since 2012, and this trend is expected to continue in the future. The largest sector of employment is agriculture – employing 56% of the total workforce – despite the fact that it only contributes around 18% to GDP. The share of those employed in agriculture has fallen from 60% in 2012 to 57% in 2016. It is forecast to fall further still to 53% by 2021. Both industry and services are expected to increase their share of employment by 2021, to 6% and 41% respectively. The official unemployment rate is 5.3 percent with higher unemployment rate in the economic capital of Abidjan (10.9 percent) and other urban areas (6.8 percent). The unemployment rate among those aged 15-35 is 7.9 percent. Despite these low numbers, the general population considers unemployment to be a critical issue. The government implemented a national strategy for employment, which includes youth capacity building for employment and training programs.
In February 2015, the government endorsed a draft law on the new labor code to replace Law 95-15 of January 12, 1995. This law will fight against employment precariousness; promote union freedom and validation of certificates by internships. It also promotes job access for the handicapped and the requirement to maintain minimum levels of service in case of strike.
Attitude to Foreign Direct Investment
The major law affecting foreign investment is the 2012 Investment Code (replacing the 1995 Investment Code). This code offers incentives, including tax reductions and in some cases exemptions from value added taxes (VAT), on equipment for private investors. This code also includes planned industrial zones, which offer benefits to investors such as special tax treatment for periods ranging from 8 to 15 years, depending on the location of the investment. There are also incentives to promote sectors (low-cost housing construction, factories, and infrastructure development) that are key to the country’s economic development. In return, investors commit to technology transfer, compliance with environmental regulations, job training, and job promotion.
The National Assembly passed on March 4, 2014, a new Mining Code designed to attract foreign investors and increase transparency. The government does not use tax, labor, environment, or health and safety laws to impede or distort investment
Côte d’Ivoire’s investment promotion center (CEPICI) provides investment information and assistance for entrepreneurs interested in starting a business or foreign enterprises interested in investing in Côte d’Ivoire. CEPICI provides a “one-stop-shop” for investors, an outreach program to match opportunities with potential investors, and a public-private liaison program.
Restrictions on Foreign investment
The Ivoirian government understands that their annual growth rate over 7.5 percent cannot be sustained without foreign investment through mergers, acquisitions, joint ventures, takeovers, or start-ups. As part of its post-crisis economic reconstruction plan, the government actively encourages FDI and is committed to doubling foreign investment over the next several years. Although the government encourages all foreign investment, French firms have traditionally dominated key sectors of the Ivoirian economy.
Foreign companies are free to invest and list on the regional stock exchange (BRVM), which is based in Abidjan and dominated by Ivoirian and Senegalese firms. With the inception of the regional exchange, the West African Economic and Monetary Union (WAEMU) members established the Regional Council for Savings and Investment, a regional securities regulatory body.
There are restrictions on foreign investment in the health sector, law and accounting firms, and travel agencies.
There are no significant limits on foreign investment nor are there differences in the treatment of foreign and national investors, either in terms of the level of foreign ownership or sector of investment. There are no laws specifically authorizing private firms to adopt articles of incorporation or association that limit or prohibit foreign investment, participation, or control, and no such practices have been reported.
Screening of FDI
The government does not screen investments and has no overall economic and industrial strategy that discriminates against foreign-owned firms.
Intellectual Property (IP) Rights
The Ivoirian Civil Code protects Intellectual Property (IP) rights; however, protection of intellectual property rights in Côte d’Ivoire is weak it does not meet the standards established by the WTO Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) and the GOCI has limited resources for IPR protection
The government’s Office of Industrial Property (OIPI) or Office Ivoirien de la Propriété Intellectuelle (OIPI) is charged with ensuring the protection of patents, trademarks, industrial designs, and commercial names. Patents are valid for ten years, with the possibility of two five-year extensions. Trademarks are valid for ten years and are renewable indefinitely. Copyrights are valid for 50 years.
The Bureau ivoirien du droit d’auteur (BURIDA), the Ivoirian Copyright Office, is responsible for the collective management and protection of copyright and related rights in Côte d’Ivoire. The Ivoirian Copyright Office (BURIDA) has a labelling system in place to prevent counterfeiting and protect audio, video, literary and artistic property rights in music and computer programs. BURIDA has worked with the Ivoirian music industry to undercut piracy, including holding regular programs promoting enforcement.
Côte d’Ivoire is a member of the World Intellectual Property Organization (WIPO) and is party to the Paris Convention, its 1958 revision, and the 1977 Bangui Agreement covering 16 Francophone African countries in the African Intellectual Property Organization (OAPI), which has been TRIPS compliant since 2002. Under OAPI, rights registered in one member country are valid in other member states.
Côte d’Ivoire’s major National parks include Assagny National Park, Banco National Park, Comoé National Park, Îles Ehotilés National Park, Marahoué National Park, Mont Péko National Park, Mont Sângbé National Park, and Taï National Park among others
Côte d’Ivoire’s main natural resources are petroleum, natural gas, diamonds, manganese, iron ore, copper, gold, nickel, cocoa beans, cashew nuts, timber, coffee and palm oil. Côte d’Ivoire has been affected by deforestation. Between 1960 and 2010, the country’s forest cover fell from 12 million hectares to 2.5 million hectares as the agriculture sector and cocoa production expanded. Deforestation rates remain high (around 4%), posing a threat to the provision of environmental services which are essential for the country’s agricultural economy.
Investment Climate in Ivory Coast has been summarized to include the following
For more reading
State Department’s Office of Investment Affairs Investment Climate Statement. EB-ICS-DL@state.gov