Press Release No. 19/96

IMF Staff Team Completes Mission to Côte d’Ivoire

March 27, 2019

• The authorities and the IMF team have reached a staff-level agreement on the fifth review of the ECF and EFF arrangements, subject to approval by IMF management and the Executive Board.
• Based on preliminary estimations, GDP grew by 7.4 percent last year driven by strong domestic demand. Inflation remained subdued at about 0.4 percent.
• The medium-term outlook is favorable but risks to the forecast are tilted to the downside.

An International Monetary Fund (IMF) mission led by Mrs. Céline Allard visited Abidjan March 14 -27, 2019 to hold discussions on the fifth review of the three-year economic and financial program supported by the IMF through arrangements under the Extended Credit Facility (ECF) and the Extended Fund Facility (EFF).

At the conclusion of the visit, Mrs. Allard issued the following statement:

“The authorities and the IMF team have reached a staff-level agreement on the fifth review of the ECF and EFF arrangements, subject to approval by IMF management and the Executive Board. Consideration by the IMF’s Executive Board is expected in June 2019.

“Based on preliminary estimations, GDP grew by 7.4 percent last year driven by strong domestic demand. Inflation remained subdued at about 0.4 percent, well below the 3 percent regional threshold of the Western Africa Economic and Monetary Union (WAEMU). Credit to the economy grew at a healthy pace of 11.3 percent in 2018. Lower overall exports value because of lower cocoa prices and higher global oil prices widened the deficit in the external current account to 4.7 percent of GDP.

“The medium-term outlook is favorable but risks to the forecast are tilted to the downside. Economic activity is projected to remain strong in 2019 and the medium-term outlook is for robust growth to continue. Risk nonetheless persist from slower than expected pace in revenue mobilization, unfavorable terms-of-trade and tighter global financial conditions.

Inflation is expected to remain well below the regional norm. The fiscal deficit should reach 3 percent of GDP in 2019, WAEMU’s regional convergence norm, in accordance with program objectives.

“Performance under the IMF-supported program was satisfactory in 2018. All performance criteria and all but one indicative quantitative targets for end-December 2018 were met. Almost all structural benchmarks were also implemented. The budget deficit reached 4.0 percent of GDP, meeting the program ceiling despite weaker than expected revenues which were offset by a slight reduction in public investment.

“IMF staff and the authorities concurred on the need to accelerate reforms critical to maintaining growth at a sustainable pace and continue making it more inclusive while preserving fiscal and debt sustainability. Staff notes the progress made by the authorities in prioritizing the new investment projects and social expenditure which should help maintaining fiscal space to finance the National Development Program (2016-2020).

“IMF staff and the authorities also agreed on the importance of increasing domestic revenues which is essential to creating fiscal space to undertake priority spending and enhancing debt payment capacity.

“The mission noted the measures taken to mitigate fiscal risks by completing the restructuring the national oil refinery and advancing in the restructuring of the public banks. The implementation of the new prudential regulations consistent with the Basel II/III principles has helped to reinforce banking sector stability.

“The mission and the authorities concurred that Côte d’Ivoire’s economic transformation program continues to advance well. Continuing actions to spread growth benefits and continue reducing poverty levels will also be important factors for ensuring the long-term success of government policies. 

“The IMF team thanks the authorities for their hospitality and productive discussions.”