Last Thursday, President Alassane Ouattara announced that his administration will cut budget expenditures for the 2017 year by 10%, due to global slump of cocoa prices.

The decision, which was discussed at the beginning of the month during the visit of an IMF delegation, will impact various sectors of the Ivoirian economy. Budget lines dedicated to investment will be reduced 10% or FCFA200 billion ($320 million).

“Salaries excluded, we were forced to cut our spending by 10%. The budget of every ministry has been reduced by 5 to 10%,” the President said cited by Reuters. The nation currently experiences an unprecedented budgetary pressure, mainly due to fall in cocoa prices, unplanned concessions for civil servants and payments made to mutineers since February 2017.

IMF says a 0.63% increase in Cote d’Ivoire’s public expenditures, will boost the nation’s cocoa exports earnings by 1%. Let’s recall that these earnings make 20% of Cote d’Ivoire’s total exports revenues.

It should be recalled that Cote d’Ivoire, in the framework of two 3-year loan agreements, will get more than $659 million. The country also plans to borrow on the international debt market to finance the economic and political reforms it initiated after the 2011 crisis.

Fiacre E. Kakpo