## _cr15147 ## Source details **Canonical URL:** [_cr15147](https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2015/_cr15147.pdf) ## Other formats - [Markdown version](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2015/_cr15147.pdf.md) - [Structured JSON version](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2015/_cr15147.pdf.json) --- ### Executive summary and program status - Presidential elections scheduled for October 2015; calm political environment with remaining sporadic incidents. - All continuous and end-December 2014 quantitative performance criteria (PCs) met; all but one indicative target (floor on government revenues) met. - Staff recommendation: complete the seventh ECF review and disburse an amount equivalent to SDR 48.78 million. - Mission dates: March 18–April 2, 2015; Report date: May 20, 2015. ### Recent macroeconomic developments and outlook - Growth: - Real GDP growth estimated at 7.9 percent in 2014 (authorities estimate 8.5 percent); cassava production rose by 74 percent contributing 1.3 percentage points to 7.9 percent GDP growth. - Staff baseline: 2015 projected 7.9 percent; average 7.6 percent over 2016–2017. Authorities project 9.4 percent in 2015 and double-digit medium-term growth. - Inflation: - Expected to hover around 2 percent; staff baseline shows Consumer price index (annual average): 2015 Prog.: 0.4; 2016 Est.: 2.6; 2017 Prog.: 1.2. - External sector: - Current account deficit narrowed to 0.7 percent of GDP in 2014 (from 1.7 percent in 2013); overall balance of payments surplus 0.6 percent of GDP in 2014 (vs 0.4 percent in 2013). - Terms of trade improved by 4.3 percent in 2014; solid cocoa export growth; lower oil prices supportive. ### Key 2014 fiscal and financing outcomes - Total revenue: CFAF 2,989.4 billion (17.7 percent of GDP) vs target CFAF 3,064.6 billion — shortfall CFAF 75.2 billion. - Total expenditure: CFAF 3,669.6 billion (21.7 percent of GDP) vs target CFAF 3,784.9 billion — under-execution of investment spending. - Overall fiscal deficit (payment order basis) narrowed to 2.2 percent of GDP in 2014 (from 2.3 percent in 2013). - Financing: greater recourse to external borrowing — 3.2 percent of GDP in 2014 vs 1.8 percent in 2013. - Eurobond issuance: US$1 billion issued February 24, 2015 (US$4 billion offered), 12-year average maturity, yield 6.625 percent (noted earlier Eurobond: US$750 million at 5.625 percent in 2014). ### 2015 new fiscal pressures and agreed adjustments - Revenue shortfalls: CFAF -116.8 billion (-0.6 percent of GDP) due to direct taxes, VAT, customs duties, dividends (base effect), lower import prices, larger-than-budgeted oil price drop; Petroci prevented from distributing dividends. - New expenditure needs: 0.6 percent of GDP, primarily to put audited extra-budgetary spending on budget (CFAF 58.4 billion) and higher electricity subsidy/HVO use and higher interest from US dollar appreciation. - Authorities’ fiscal response commitments: - Raise additional revenue (0.5 percent of GDP) and cut spending; revenue sources: higher petroleum product tax revenue, expected signature bonuses, recovery of tax claims on Petroci, higher social security contributions. - Revise downward projected investment spending based on 2014 execution; delay salary increases; take CFAF 12 billion from budget provision for unforeseen spending. - Revised 2015 projections: - Overall fiscal deficit projected 0.3 percent of GDP higher than budgeted, reaching 3.7 percent of GDP. - Primary basic fiscal deficit in 2015 projected to reach 0.5 percent of GDP. - Staff view: revised fiscal targets appropriate; excluding audited extra-budgetary spending (0.3 percent of GDP) basic primary balance equals that programmed at sixth review. In CFA francs, projected overall deficit (including extra-budgetary spending) about same as initial 2015 budget. ### Extra-budgetary spending, audits, and regularization - Off-budget expenditures do not trigger PCs under the TMU because PCs use payment order basis. - Authorities will rotate directors of administrative and financial affairs of line ministries to detect extra-budgetary spending; ongoing audits of pre-2011 spending with results expected second half of 2015. - Staff recommendations: - Frequent audits of line ministries by the Inspector-General’s office. - Prompt completion of ongoing audits and regularization of verified amounts. - Strict enforcement of the 1998 decree (Decree No. 98-716 of December 16, 1998) to prevent/punish spending outside the budget. ### Automatic fuel pricing mechanism (structure and revenues) - Mechanism in place since April 2013 transmits international oil price fluctuations to domestic retail prices with smoothing and a floor on taxable base (25 percent of cif import price). - Cross-price diesel/gasoline subsidy trigger when diesel price exceeds CFAF 615. - Initial 2015 budget projected fuel tax revenues at 1.2 percent of GDP based on taxation levels CFAF 194.4 per liter (gasoline) and CFAF 88.4 per liter (diesel). - As of January 2015, fuel taxation stood at CFAF 262 per liter (gasoline) and CFAF 156.6 per liter (diesel); preserving this level through year-end would generate additional fuel tax revenues of about 0.4 percent of GDP in 2015. ### Public Financial Management (PFM), cash management, and TSA - Enforcement measures: April 23, 2015 Council of Ministers reaffirmed the 1998 decree; government committed to forceful application and disciplining contraveners. - Preventive measures: establish an information center for suppliers, ensure realistic 2015 budget appropriations for subsidies and private schools, strengthen controls over line ministries (staff mobility, audits). - Treasury Single Account (TSA): - Closure of inactive public accounts at commercial banks by end-April 2015; remainder over three years. - Government to start four TSA pilot cases in 2015; short-term TSA scope limited by need to keep a large number of public accounts in a specific public bank for its liquidity. ### Public debt management and market development - Updated medium-term debt strategy finalized (SDMT 2015–19). - Authorities committed to complete reorganization of debt department into front-, middle-, and back-offices before end-June 2015. - Centralized database of public enterprises’ and government-guaranteed debt to be finalized end-June 2015. - Staff urged development of regional secondary market to deepen liquidity and limit foreign exchange risk; follow December 2014 World Bank-IMF TA recommendations. ### Financial sector reforms and vulnerabilities - Credit to the economy increased by 21.7 percent (crop credit +59 percent); credit to private sector +27.4 percent in 2014 (Supplement). - Banking indicators: - NPLs (gross) declined to 10.4 percent of total loans at end-2014 (from 12.7 percent in 2013). NPLs net of provisions: 2.65 percent at end-2014. - Banking sector capital adequacy ratio rose to 10.1 percent at end-December 2014 (minimum 8 percent; 9.2 percent in 2013). - Vulnerabilities persist in some individual banks; public banks and a couple of small banks with capital adequacy below regulatory minimum. - Financial sector development strategy implementation delayed due to staffing; planned steps include laws/regulations on treasury bond primary dealers, credit bureaus, draft leasing law, improved microfinance position. - Public banks: resolution of BFA in September 2014; sale of most state shares in SIB in February 2015; staff urged prompt action on remaining ailing public banks. ### Energy sector financial position and remedial measures - Electricity sector operational accounts improved but remain fragile; higher use of HVO and US dollar appreciation raised costs. - SIR and Petroci made large losses in 2014; Petroci unable to pay taxes and 2013 dividends. - Understandings: - Settlement of cross arrears between government and Petroci and increase in electricity subsidy in 2015 to reflect higher HVO use. - Payment in cash of IOUs to SIR amounting to CFAF 56.9 billion by end-June 2015 (structural benchmark), to be financed through a bond issuance on the regional market. - Structural benchmarks: completion of strategic audits — Petroci (underway) and SIR (to be launched). ### Structural reforms, business climate, and social spending - Domestic arrears clearance: - Complete regularization: CFAF 15.5 billion remain out of CFAF 152.9 billion audited arrears. - Regularize past securitized debt: about CFAF 43 billion remain out of CFAF 142.9 billion. - Procurement and governance: - Non-competitive procurement contracts: 5.6 percent of contracts approved in 2014 (vs 10.7 percent in 2013); accounted for 23 percent of value in 2014 (vs 42.8 percent in 2013). - Average procurement time reduced from 322 days in 2013 to 126 days in 2014. - Decree No. 2014-306 of May 27, 2014 amended procurement code aiming to reduce timeline to 88 days. - Social and pro-poor spending: - Pro-poor expenditures: CFAF 1,622.4 billion at end-2014 (9.6 percent of GDP) vs 8.6 percent of GDP in 2013; pro-poor expenditure IT exceeded objective (107 percent). ### Statistics, data quality weaknesses, and TA - Significant weaknesses in national accounts measurement (gaps in subsistence agriculture, construction, real estate services); staffing and capacity constraints at INS. - Weaknesses identified in 2012 national accounts: computation of nominal taxes on products and unexplained movements in sector value added. - Authorities requested STA technical assistance; STA mission planned for first quarter of FY16. - Staff urged upgrading and dissemination of economic data to facilitate monitoring by private investors and credit rating agencies. ### Projections, risks, and vulnerabilities (selected staff baseline numbers) - Growth projections: - GDP at constant prices: 2014 Est.: 8.0; 2015 Prog.: 7.9; 2016 Est.: 8.0; 2017 Prog.: 7.9. - Public debt and debt service: - Central government gross public debt expected to hover around 43 percent of GDP over the medium term (assuming overall fiscal deficit close to 3 percent of GDP); staff table shows Gross public debt (percent of GDP, central government only): 2014 Est.: 39.9; 2015 Prog.: 46.6; 2016 Est.: 39.4; 2017 Prog.: 45.6. - Public external debt-service due (CFAF billions): 2014 Est.: 326; 2015 Prog.: 324; 2016 Est.: 386; 2017 Prog.: 413. Percent of government revenue: 2014 Est.: 10.5; 2015 Prog.: 10.8; 2016 Est.: 12.3; 2017 Prog.: 12.0. - Risks (main downside): - Domestic: social tensions and political risks linked to October presidential elections; further extra-budgetary spending; unfavorable weather affecting agriculture and electricity. - External: tighter global financial conditions complicating financing of large public investment program; protracted sluggish growth in advanced and emerging economies. - Upside: post-election private investment pick-up could boost growth in 2016 but considered uncertain for baseline. ### Program monitoring, structural benchmarks, and performance criteria modifications - Authorities requested modifications to end-June 2015 PCs (primary basic balance and net domestic financing) and indicative targets consistent with revised fiscal projections. - Continuous ceiling on non-concessional borrowing increased by $793 million to accommodate external loan for Port d’Abidjan extension. - Proposed structural benchmarks for remainder of 2015 include PFM, financial sector reform, and business climate actions (see SBs such as payment in cash of securitized debt to SIR and PETROCI — SB end-June 2015; adopt protocol for HVO payments — SB end-June 2015; draft leasing law — SB end-September 2015). - TMU definitions and monitoring rules set out (date of TMU: May 19, 2015); PCs include floor on primary basic fiscal balance and ceiling on net domestic financing and new nonconcessional external debt; ITs include floor on overall fiscal balance including grants and floor on pro-poor expenditures. ### Staff appraisal and final recommendation - Staff commends authorities for strong macroeconomic performance and program implementation since 2011 (real GDP per capita grew 20 percent over 2012–14). - Staff considers 2015 fiscal stance appropriate after modest adjustments; calls for resistance to election-related spending pressures and control of current spending increases over the medium term. - Staff recommends completion of the seventh review and disbursement of SDR 48.78 million. *Source: IMF staff report excerpts — _cr15147 (May 19–20, 2015; IMF staff mission March 18–April 2, 2015).* ### EXECUTIVE SUMMARY ### EXECUTIVE SUMMARY ### Background - Côte d’Ivoire is preparing for presidential elections in October 2015 amid strong macroeconomic performance. - All continuous and end-December quantitative performance criteria (PCs) and all but one indicative targets were met. - All structural benchmarks were implemented, albeit with a minor delay regarding the restructuring/sale of a public bank’s capital holdings. - Some important structural measures experienced significant delays. ### Policy discussions - Main focus: - Containing the expansion of the 2015 fiscal deficits in light of new challenges. - Moving forward structural reforms under the program. - Agreements: - Authorities and IMF staff agreed to fiscal measures underpinning a small adjustment in the fiscal targets for 2015. - Other topics discussed: - Measures to strengthen the financial position of the energy sector. - Public Financial Management (PFM) reforms and public debt management (including reorganization into front-middle-back offices). - Financial sector reforms and private sector development. ### Outlook and risks - Macroeconomic outlook remains positive with high growth rates projected in 2015 and over the medium term due to continued efforts to address infrastructure gaps and improve the business climate. - Main downside risks: - Social tensions and remaining political risks linked to the October presidential elections. - Tighter global financial conditions complicating financing of the large public investment program. - A protracted period of sluggish growth in advanced and emerging economies. - Staff recommendation: - Support for the authorities’ request for completion of the seventh ECF review and for modification of the performance criteria for end-June 2015 and indicative targets. - Disbursement upon completion of this review: SDR 48.78 million. *May 20, 2015 — IMF staff mission: March 18–April 2, 2015 (Abidjan).* ### Recent developments - Growth: - Real GDP growth estimated at 7.9 percent in 2014, driven by services and agriculture; secondary sector growth was relatively sluggish partly due to lower value added in the energy sector. - Authorities estimate 2014 growth at 8.5 percent (higher tertiary sector rates). - Exceptional cassava production: 74 percent increase, contributing 1.3 percentage points to 7.9 percent GDP growth. - Fiscal outcomes (2014): - Total revenue collection was CFAF 75 billion (0.5 percent of GDP) short of objective. - Shortfalls due to lower direct taxes (CIT, PIT and capital gains) and VAT, higher provisioning in banking sector, unpaid taxes by a few public entities, and lower CPI inflation. - Total expenditure was CFAF 120 billion (0.7 percent of GDP) below target due to under-execution of investment spending. - Overall fiscal deficit (payment order basis) narrowed to 2.2 percent of GDP in 2014 (from 2.3 percent in 2013). - Financing: greater recourse to external borrowing — 3.2 percent of GDP in 2014 vs 1.8 percent of GDP in 2013. - External sector (2014): - Current account deficit narrowed to 0.7 percent of GDP in 2014 (from 1.7 percent in 2013). - Terms of trade improved by 4.3 percent; solid growth of cocoa exports; lower oil prices supportive. - Overall balance of payments surplus: 0.6 percent of GDP in 2014 (vs 0.4 percent in 2013). - Financial sector and credit: - Credit to the economy increased by 21.7 percent (crop credit +59 percent). - NPLs (gross) declined to 10.4 percent of total loans at end-2014 (from 12.7 percent in 2013). - NPLs net of provisions stood at 2.65 percent at end-2014. - Banking sector capital adequacy ratio rose to 10.1 percent at end-December 2014 (minimum requirement 8 percent; 9.2 percent in 2013). - Vulnerabilities persist in some individual banks, notably public banks and a couple of small banks with capital adequacy below regulatory minimum. - Sovereign bond issuance: - February 24, 2015: Issued US$1 billion (US$4 billion offered) with 12-year average maturity and yield of 6.625 percent. - Socio-political environment: - Calm ahead of October 2015 presidential elections. - Major parties of ruling coalition endorsed President Ouattara; former ruling party FPI to participate. - Progress on political reconciliation: detainees liberated, bank accounts unfrozen. - Security improving though sporadic incidents persist; no confirmed Ebola cases to date. ### Program performance - Quantitative performance: - All continuous and end-December 2014 quantitative PCs and all but one IT were met. - Basic primary deficit was below targeted program level by a narrow margin. - Continuous ceiling on new nonconcessional external debt observed. - Ceiling on net domestic financing observed despite larger-than-planned T-bond issuance because excess proceeds reduced floating debt and increased cash balances at the BCEAO. - Pro-poor expenditure (IT) exceeded objective (107 percent). - Floor for government revenues (IT) was missed (see revenue shortfalls above). - Identified extra-budgetary spending in 2014 reduced margins; if included in fiscal accounts, offsetting savings would have been required. - Structural reforms: - All end-December 2014 structural benchmarks implemented, with minor delay on sale of majority of state holdings in a bank. - Government took measures to improve business climate and tax administration. - Significant delays in: implementation of financial sector reform strategy, reorganization of public debt department into front-middle-back offices, and domestic arrears clearance. ### Projections and key statistics (staff baseline) - Growth: - Projected 7.9 percent in 2015. - Average 7.6 percent over the next two years (2016–2017). - Authorities’ projections: 9.4 percent growth in 2015 and double-digit growth over the medium term. - Inflation: - Expected to hover around 2 percent (assuming continued good harvests, prudent monetary policy, and stability in international oil and food prices). - Current account: - Projected to increase to 2.6 percent of GDP on average over the medium term (less favorable terms of trade and stronger import growth). - Public debt and debt service: - Central government gross public debt expected to hover around 43 percent of GDP over the medium term (assuming overall fiscal deficit close to 3 percent of GDP). - Debt service (including C2D) projected to rise to above 13 percent of total revenue from 10.8 percent in 2014. ### Risks and vulnerabilities - Domestic risks: - Social tensions or political risks related to presidential elections could be downside risks to growth. - Further extra-budgetary spending could create unsettled domestic liabilities and negatively affect private investment. - Unfavorable weather could damage agricultural production and hurt the electricity sector. - External risks: - Tighter global financial conditions may complicate financing of public investment program. - Sluggish growth in advanced and emerging economies could adversely affect economic activity. - Upside possibility: - Post-election reduction in wait-and-see behavior by private investors could push growth above baseline in 2016 (considered too uncertain for baseline). *Source: IMF staff Report — EXECUTIVE SUMMARY (Mission dates: March 18–April 2, 2015; Report date: May 20, 2015).* ### 11. The authorities agreed to factor in new fiscal pressures that have emerged since the ### _cr15147 - 11. The authorities agreed to factor in new fiscal pressures that have emerged since the ### New fiscal pressures and 2015 fiscal adjustments - Revenue shortfalls total CFAF -116.8 billion (-0.6 percent of GDP) due to: - Shortfalls on direct taxes, VAT, customs duties and dividends arising from a base effect (lower 2014 revenue outturn), lower import prices, and a larger fall in international oil prices than assumed in the budget. - The impact of lower oil prices on the oil company Petroci preventing it from distributing dividends. - New expenditure needs amount to 0.6 percent of GDP, mainly related to putting on budget: - Audited amounts of extra budgetary spending in 2014 in education (private schools) and military (fuel supply) sectors amounting to CFAF 58.4 billion. - Implications on the electricity subsidy of higher use of heavy vacuum oil (HVO) by the electricity sector in 2014 than foreseen in the 2015 budget, and higher interest because of the appreciation of the US dollar. - Authorities’ fiscal response commitments: - Raise additional revenue and cut spending to contain fiscal deficit expansion (MEFP, ¶26–31). - Additional revenues (0.5 percent of GDP) sources: higher petroleum product tax revenue, expected signature bonuses for new mining exploration contracts, recovery of tax claims on Petroci as part of a settlement of cross arrears, and higher social security contributions (reflecting the higher 2014 outturn). - Revise downward projected investment spending based on 2014 execution rate; delay salary increases from January to later in the year; take CFAF 12 billion out of the budget provision for unforeseen spending to offset part of the extra budgetary spending. - Revised 2015 fiscal projections: - Revised overall fiscal deficit in 2015 is projected to be 0.3 percent of GDP higher than budgeted, reaching 3.7 percent of GDP. - Revised primary basic fiscal deficit in 2015 is projected to reach 0.5 percent of GDP. - Staff assessment and guidance: - Staff considers revised fiscal targets appropriate; modest deterioration of the primary basic deficit is largely due to exogenous shocks (drop in oil and import prices) and integration of audited extra budgetary spending. - Excluding the audited extra budgetary spending put on budget (0.3 percent of GDP), the projected basic primary balance in 2015 would equal the one programmed at the time of the 6th review. - In CFA francs, the projected overall deficit (including extra budgetary spending) is about the same as planned in the 2015 initial budget. - Staff called on authorities to resist elections-related spending pressures and to monitor increases in current spending over the medium term. ### Extra-budgetary spending, audits, and regularization - Staff concluded off-budget expenditures do not give rise to accumulation of arrears or misreporting for purposes of the PCs under the TMU because only expenditures on a payment order basis are taken into account. - Authorities’ assurances and actions: - Could not trace further recent extra budgetary spending liabilities (MEFP, ¶32). - Will organize rotation of directors of administrative and financial affairs of line ministries to facilitate discovery of any recent extra budgetary spending. - Underscored sizable extra budgetary spending incurred prior to 2011; ongoing audit results expected in the second half of 2015, with a regularization strategy to be decided thereafter. - Staff recommendations: - Frequent audits of line ministries by the Inspector-General’s office. - Promptly complete ongoing audits and regularize verified amounts. ### Automatic fuel pricing mechanism (Box 1) — structure and revenue implications - Mechanism in place since April 2013 to transmit international oil price fluctuations to domestic retail prices while smoothing pump price fluctuations through adjustments to the taxable base subject to a floor. - Key features: - Smoothing operates by triggering retail price adjustments only when international price changes exceed specified thresholds. - Government retains some discretion regarding full pass-through of international oil price changes. - Floor on the taxable base: 25 percent of the cif import price, to ensure a minimum level of fuel tax revenues. - Cross-price subsidy between gasoline and diesel: kicks in when diesel price exceeds CFAF 615 to mitigate increases in the pump price of diesel. - Projections and observed taxation levels: - Initial 2015 budget projected fuel tax revenues at 1.2 percent of GDP compared to 1.0 percent of GDP in 2014, based on taxation levels of CFAF 194.4 per liter for gasoline and CFAF 88.4 per liter for diesel. - As of January 2015, due to partial pass through of the drop in international oil prices and full application of the taxable base for tax revenue purposes, fuel taxation stood at CFAF 262 per liter for gasoline products and CFA 156.6 for diesel products. - Preserving this amount of fuel taxation through the end of the year would generate additional fuel tax revenues of about 0.4 percent of GDP in 2015. - Implementation note (footnote): - This could be achieved by preserving the full amount of fuel taxation achieved in early 2015 (because of the partial pass through of the drop in international oil prices to consumers); i.e., by fully passing through to the consumer any future changes, in international oil prices. ### Public financial management (PFM), off-budget operations, and expenditure management - Enforcement and prevention measures: - Authorities concurred on enforcing regulatory framework to prevent and punish spending outside the budget (MEFP, ¶33). An April 23, 2015, Council of Ministers reaffirmed the 1998 decree. - Government commitment to forcefully apply the 1998 decree, including disciplining contraveners. - Measures to prevent extra budgetary spending: (i) establishing an information center to increase suppliers’ awareness of budget appropriations; (ii) ensuring realistic budget appropriations starting in 2015 for subsidies to private schools, the electricity sector and military fuel purchases; (iii) strengthening control over line ministries (increasing staff mobility and audits). - Staff suggested considering a specialized budgetary and financial discipline chamber within the planned Court of Auditors; Fund ready to provide technical assistance to reform PFM practices. - Mission concerns on off-budget mechanisms: - Growing use of off-budget mechanisms financed through borrowing by public entities to carry out fiscal and quasi-fiscal activities is concerning. - Mission opposed envisaged borrowing to carry out the rural electricity program (through CI-Energies) and the universal access program to telecom services (through ANSUT), stressing such activities are fiscal and should be included in the budget. - Practice violates universality principle, narrows budget perimeter, weakens budget control; mission called on government to refrain from using public entities for fiscal/quasi-fiscal activities and to broaden budget scope. - Expenditure management recommendations: - Further reduce recourse to cash advances, imprest accounts (régies d’avances), and other exceptional spending procedures (about 2 percentage points of GDP currently). - April 23, 2015 Communication includes provisions to limit recourse to cash advances. ### Cash management and Treasury Single Account (TSA) - Authorities taking steps toward setting up a Treasury Single Account (TSA) (MEFP, ¶40). - Timetable and scope: - Closure of inactive public accounts at commercial banks by end-April 2015 and the remainder over three years. - Architecture of envisaged TSA discussed; government intends to start four pilot cases in 2015. - Short-term scope of TSA will be limited by need to maintain a fairly large number of public accounts in a specific public bank to keep the bank liquid. ### Public debt management - Debt management actions and concerns (MEFP, ¶45–47): - Updated medium-term debt strategy finalized. - Concerns over excessive delays in reorganizing the debt department into front-, middle-, and back-offices due to staffing issues. - Concern over accumulation of debt (in national currency) by public sector entities in fragile financial situations. - Authorities committed to completing reorganization of the debt management unit before end-June 2015 (MEFP, ¶45). - Development of a centralized database covering public enterprises’ and government guaranteed debt is well advanced; finalization expected end-June 2015 to enable better monitoring of loans contracted by public entities. - Regional secondary market: - Need to foster development of a secondary market to deepen the market and limit accumulation of foreign exchange risk. - Current unattractiveness of the regional market for foreign investors due to buy-and-hold nature; staff urged consideration of recommendations from a December 2014 joint World Bank-IMF TA mission to deepen, unify, and add liquidity to the regional market. ### Structural reforms — fostering private sector development - Business climate improvements and remaining issues (MEFP, ¶48–50): - Domestic arrears clearance: - Complete regularization of remaining audited arrears to suppliers: CFAF 15.5 billion out of CFA 152.9 billion remain. - Regularize past securitized debt to banking and non-banking sectors: about CFAF 43 billion or 0.2 percent of GDP out of CFAF 142.9 billion or 0.8 percent of GDP remain. - Authorities indicated remaining arrears creditors have resisted proposed haircuts and financial terms but promised to reach out to them to complete the process before year-end. - Commercial courts: - Effective operation of commercial court of Abidjan welcomed; staff emphasized creating other commercial courts and a court of appeal; actions planned by authorities. - Relations with suppliers and taxpayers: - Staff noted concerns that private operators reported the treasury paid bills with long delays and tax and customs directorate harassing larger taxpayers. - Authorities stated no new domestic arrears had been accumulated since 2011 and larger taxpayers were not subject to tax harassment. - Staff advised enhancing transparency of tax control procedures. ### Financial sector reform - Mission concerns and calls for action (MEFP, ¶41–44): - Financial sector development strategy implementation delayed by staffing of organizational structure; staff stressed necessity to implement strategy to foster financial inclusion and SME credit access. - Authorities’ steps: laws and regulations on treasury bond primary dealers and credit bureaus, preparation of a draft law on leasing, measures to provide certain bank services free of charge, measures to improve financial position of microfinance institutions, appointment process for program project manager in final stage. - Restructuring of public banks: - Resolution of Banque pour le Financement de l’Agriculture (BFA) in September 2014 welcomed. - Government sale of most of its share in Société Ivoirienne de Banque (SIB) in February 2015 welcomed. - Staff pressed for prompt action on remaining ailing public banks to minimize fiscal restructuring costs and reduce banking system vulnerabilities. ### Energy sector financial situation and remedial actions - Electricity sector: - Financial situation improved following measures over last three years (better targeting of social tariff, increase in export prices, fight against fraud), but remains fragile. - Authorities indicated upcoming projects will help reduce cost of generating electricity. - Oil sector companies: - Fragile financial situation of SIR and Petroci compounded by large government IOUs, exacerbated by falling international oil prices and US dollar appreciation. - Both companies made large losses in 2014; Petroci unable to pay its taxes and 2013 dividends. - Understandings reached on: - Settlement of cross arrears between government and Petroci and an increase in electricity subsidy in 2015 to reflect higher HVO use in 2014. - Payment in cash of IOUs to SIR in amount of CFAF 56.9 billion by end-June 2015 (structural benchmark), to be financed through a bond issuance on the regional market. - Authorities committed to timely payment of HVO bills owed to these companies. - Structural benchmarks: completion of strategic audits — Petroci (underway) and SIR (to be launched). ### Statistical system weaknesses - Significant weaknesses cloud precise measurement of growth performance (see paragraph 1). - Data gaps and methodological issues: - Lack of source data in sectors: subsistence agriculture, construction and public works, real estate services — leading to use of proxies or focus group methodologies that yield imprecise measurements. - Staffing and capacity constraints at the National Statistical Office (INS). - Occasional errors in national accounts compilation. - Identified weaknesses in 2012 national accounts (latest year with final estimates): issues concerning computation of nominal taxes on products and unexplained movements in sector value added in real terms, directly affecting GDP growth measurement. *Source: _cr15147 - 11. The authorities agreed to factor in new fiscal pressures that have emerged since the (IMF staff report content supplied).* ### 23. The authorities and staff agreed that the production of quality economic data needs to ### 23. The authorities and staff agreed that the production of quality economic data needs to ### Data quality and national accounts - The authorities and staff agreed that the production of quality economic data needs to be significantly upgraded to strengthen decision-making. - The government requested technical assistance from STA to diagnose key weaknesses in the production of source date and the compilation of national accounts; a mission is planned for the first quarter of FY16. - Staff regretted that the weaknesses identified in the national accounts for 2012 had not been addressed before the ongoing finalization of the national accounts for 2013. - Recommendation: Côte d’Ivoire should upgrade and disseminate economic data to facilitate monitoring by private investors and credit rating agencies. ### National Development Plan (2012–15) - The government issued a progress report on the implementation of the 2012–15 National Development Plan (MEFP, ¶18). - The report, prepared in broad consultation with stakeholders and development partners, describes achievements in macroeconomic, structural and social policies. - Findings: - Côte d’Ivoire has achieved strong economic growth, restored macroeconomic stability and made significant inroads in structural reforms and poverty reduction. - Challenges remain to consolidate peace and strengthen social cohesion. ### Program monitoring, financing, and risks - Modifications requested by authorities: - Adjustments to end-June performance criteria (primary basic balance and net domestic financing) and indicative targets in light of revised fiscal projections (MEFP, Table 1). - Continuous ceiling on non-concessional borrowing increased by $793 million to accommodate an external loan to finance the extension of the Port d’Abidjan. - New structural benchmarks on PFM, financial sector reform and business climate proposed for remainder of 2015 (MEFP, Table 2). - Financing: - The program is fully financed. There are firm commitments from multilateral partners to cover the projected financing gap. - Risks (assessed as moderate): - Domestic risks: deterioration in the political and/or security situation; persistence of Ebola outbreak in neighboring countries could delay private investment decisions in the short term. - Social risks: periodic strikes in the public sector and the unfinished political reconciliation agenda ahead of the 2015 elections. - Statistical risks: significant weaknesses in the statistical system could make the recent and near-term growth outlook somewhat optimistic, complicating fiscal management in 2015. - Political climate: improving noticeably over last four years; occurrence of major violent incidents linked to the elections seen as fairly unlikely. - Authorities’ commitments and program credibility: - Authorities agreed to reexamine revenue projections at the time of the eighth review mission in September and adjust expenditures as necessary to achieve fiscal targets. - Strong implementation of the program since 2011 lends credibility to the government’s commitment to stay on course with the ECF-supported program despite the electoral context. ### Staff appraisal and policy recommendations - Commendation: - Authorities commended for continued strong macroeconomic performance under the Fund-supported program. - Over 2012–14, the growth in real GDP per capita has reached 20 percent. - All performance criteria and all but one indicative targets for end-2014 were met. - Growth and structural reform priorities: - Sustaining high growth rates requires further reforms to improve the business climate, including: - Creation of other commercial courts and a commercial court of appeal. - Reduction of domestic payments delays. - Improvement of relations between tax payers and tax collection agencies through enhanced transparency in tax control procedures. - Implementation of the financial sector development strategy to foster access to credit by SMEs. - Fiscal stance and vulnerabilities: - Staff considers the fiscal stance for 2015 remains appropriate despite emerging budgetary pressures. - Proposed adjustments to the 2015 budget include additional revenues and spending cuts allowing limiting the deterioration of the basic primary and of the overall deficit to 0.3 percent of GDP (i.e., the amount of extra budgetary spending put on budget). - The 2015 overall budget deficit is, in CFA francs, similar to the amount projected at the time of the 6th review. - The budget remains broadly growth-friendly and pro-poor, with significant increases in public investment and poverty-reduction expenditures. - Staff calls on authorities to stick to these fiscal objectives, control increases in current spending over the medium term, and take forceful actions to put the energy sector on a more solid financial footing to limit corresponding fiscal risks. - Extra-budgetary spending concerns: - Recent discovery of extra-budgetary spending is worrisome. - Authorities provided assurances they do not know of further extra-budgetary spending other than amounts reported in this review. - The April 23, 2015 Council of Ministers Communication reaffirmed that extra budgetary spending should be avoided. - Staff calls on the government to strictly apply the provisions of the 1998 decree aimed at avoiding extra budgetary spending, including through disciplinary, civil, and penal sanctions of contraveners. - Staff welcomes authorities’ initiative to launch audits of extra-budgetary spending undertaken before 2011. - Public financial management and public debt management actions needed: - Broaden the budget’s scope to ensure it covers all governmental activities and to avoid public entities borrowing to execute expenditures that should be in the budget. - Reduce public spending undertaken through exceptional spending procedures, notably treasury advances. - Pay close attention to accumulation of debt by public sector entities. - Implement restructuring of the public debt directorate into front-, middle-, and back-office and set up a centralized database covering public enterprises’ and government guaranteed debt. - Deepen the regional fixed-income market and develop a secondary market to limit foreign exchange risk on public borrowing in the future. - Statistical system improvements (reiteration): - Staff supports authorities’ commitment to address weaknesses in the national accounts statistics. - Urged actions: strengthen staffing and capacity at the INS, address information gaps on several economic sectors, review the compilation of national account statistics, and correct weaknesses identified in the final accounts for 2012. - More broadly, upgrade and disseminate economic data to facilitate monitoring by private investors and credit rating agencies. - Staff encouraged by the authorities’ request for technical assistance as reflecting willingness to address this issue. *IMF staff report excerpts (paragraphs 23–33)* ### 34. Staff supports the authorities’ requests for the modification of the end-June 2015 ### 34. Staff supports the authorities’ requests for the modification of the end-June 2015 performance criteria. It recommends completion of the seventh review and the disbursement of an amount equivalent to SDR 48.78 million. ### Staff recommendation - Staff supports the authorities’ requests for the modification of the end-June 2015 performance criteria. - Staff recommends completion of the seventh review and the disbursement of an amount equivalent to SDR 48.78 million. ### National income and prices (selected indicators and projections) - GDP at constant prices: 2012: 10.7; 2013: 8.7; 2014 Est.: 8.0; 2015 Prog.: 7.9; 2016 Est.: 8.0; 2017 Prog.: 7.9; 2016 Proj.: 7.7; 2017 Proj.: 7.4 - GDP deflator: 2012: 4.4; 2013: 2.0; 2014 Est.: 4.6; 2015 Prog.: 0.6; 2016 Est.: 5.1; 2017 Prog.: 1.9; 2016 Proj.: 1.7; 2017 Proj.: 1.8 - Consumer price index (annual average): 2012: 1.3; 2013: 2.6; 2014 Est.: 0.6; 2015 Prog.: 0.4; 2016 Est.: 2.6; 2017 Prog.: 1.2; 2016 Proj.: 1.5; 2017 Proj.: 1.8 - Consumer price index (end of period): 2012: 3.4; 2013: 0.4; 2014 Est.: 1.6; 2015 Prog.: 0.9; 2016 Est.: 1.6; 2017 Prog.: 0.9; 2016 Proj.: 1.8; 2017 Proj.: 2.0 ### External sector (selected levels and growth) - Exports, f.o.b., at current prices (annual changes): 2012: -4.1; 2013: -0.6; 2014 Est.: 12.3; 2015 Prog.: 9.9; 2016 Est.: 11.7; 2017 Prog.: -6.4; 2016 Proj.: 7.5; 2017 Proj.: 5.0 - Imports, f.o.b., at current prices (annual changes): 2012: 35.8; 2013: 0.0; 2014 Est.: 2.6; 2015 Prog.: 5.7; 2016 Est.: 7.9; 2017 Prog.: -6.8; 2016 Proj.: 7.1; 2017 Proj.: 7.9 - Export volume (annual changes): 2012: 8.2; 2013: 0.4; 2014 Est.: 5.1; 2015 Prog.: 1.9; 2016 Est.: 12.6; 2017 Prog.: 7.9; 2016 Proj.: 4.7; 2017 Proj.: 5.8 - Import volume (annual changes): 2012: 49.2; 2013: 3.6; 2014 Est.: 4.9; 2015 Prog.: 6.3; 2016 Est.: 9.6; 2017 Prog.: 11.9; 2016 Proj.: 8.3; 2017 Proj.: 7.1 - Terms of trade (deterioration –): 2012: -2.6; 2013: 3.9; 2014 Est.: 9.3; 2015 Prog.: 4.3; 2016 Est.: 7.8; 2017 Prog.: 26.0; 2016 Proj.: 3.8; 2017 Proj.: -1.5 ### Money and credit (changes and levels) - Money and quasi-money (M2) (annual changes): 2012: 4.4; 2013: 11.6; 2014 Est.: 17.1; 2015 Prog.: 15.9; 2016 Est.: 17.8; 2017 Prog.: 14.3; 2016 Proj.: 14.0; 2017 Proj.: 14.0 - Net foreign assets (changes): 2012: -5.5; 2013: 0.1; 2014 Est.: 1.3; 2015 Prog.: 3.9; 2016 Est.: 4.0; 2017 Prog.: 3.0; 2016 Proj.: 3.8; 2017 Proj.: 4.0 - Net domestic assets (changes): 2012: 9.8; 2013: 11.5; 2014 Est.: 15.8; 2015 Prog.: 12.0; 2016 Est.: 13.8; 2017 Prog.: 11.3; 2016 Proj.: 10.3; 2017 Proj.: 10.0 - Credit to private sector (changes): 2012: 5.3; 2013: 10.6; 2014 Est.: 13.8; 2015 Prog.: 11.2; 2016 Est.: 12.7; 2017 Prog.: 11.8; 2016 Proj.: 10.0; 2017 Proj.: 9.2 ### Central government fiscal stance and projections (selected) - Total revenue and grants (percent of GDP): 2012: 18.9; 2013: 19.8; 2014 Est.: 19.6; 2015 Prog.: 19.8; 2016 Est.: 19.6; 2017 Prog.: 20.9; 2016 Proj.: 21.2 - Total revenue (percent of GDP): 2012: 18.4; 2013: 18.5; 2014 Est.: 17.7; 2015 Prog.: 17.9; 2016 Est.: 17.7; 2017 Prog.: 18.8; 2016 Proj.: 19.0; 2017 Proj.: 19.4 - Total expenditure (percent of GDP): 2012: 22.1; 2013: 22.1; 2014 Est.: 21.8; 2015 Prog.: 22.0; 2016 Est.: 23.0; 2017 Prog.: 24.6; 2016 Proj.: 24.4; 2017 Proj.: 24.6 - Overall balance, incl. grants, payment order basis (percent of GDP): 2012: -3.1; 2013: -2.3; 2014 Est.: -2.3; 2015 Prog.: -2.3; 2016 Est.: -3.4; 2017 Prog.: -3.7; 2016 Proj.: -3.5; 2017 Proj.: -3.4 - Primary basic balance (percent of GDP): 2012: -1.2; 2013: -0.1; 2014 Est.: -0.5; 2015 Prog.: -0.5; 2016 Est.: -0.2; 2017 Prog.: -0.5; 2016 Proj.: 0.3; 2017 Proj.: 0.5 - Gross investment (percent of GDP): 2012: 16.5; 2013: 17.0; 2014 Est.: 17.3; 2015 Prog.: 16.8; 2016 Est.: 18.5; 2017 Prog.: 18.3; 2016 Proj.: 18.2; 2017 Proj.: 18.8 ### External sector and reserves (selected) - Current account balance (including official transfers) (percent of GDP): 2012: -1.2; 2013: -1.4; 2014 Est.: -3.1; 2015 Prog.: -0.7; 2016 Est.: -1.9; 2017 Prog.: -0.7; 2016 Proj.: -1.3; 2017 Proj.: -2.6 - Current account balance (excluding official transfers) (percent of GDP): 2012: -1.8; 2013: -2.7; 2014 Est.: -5.0; 2015 Prog.: -2.5; 2016 Est.: -3.8; 2017 Prog.: -2.8; 2016 Proj.: -3.2; 2017 Proj.: -4.5 - Gross public debt (percent of GDP, central government only): 2012: 44.5; 2013: 43.7; 2014 Est.: 39.9; 2015 Prog.: 46.6; 2016 Est.: 39.4; 2017 Prog.: 45.6; 2016 Proj.: 43.9; 2017 Proj.: 42.2 - External public debt (percent of GDP): 2012: 28.0; 2013: 26.4; 2014 Est.: 26.5; 2015 Prog.: 27.9; 2016 Est.: 27.6; 2017 Prog.: 31.6; 2016 Proj.: 30.6; 2017 Proj.: 29.5 - External public debt (excluding C2D) (percent of GDP): 2012: 17.2; 2013: 16.4; 2014 Est.: 18.9; 2015 Prog.: 19.1; 2016 Est.: 21.6; 2017 Prog.: 26.9; 2016 Proj.: 26.4; 2017 Proj.: 25.6 - Public external debt-service due (CFAF billions): 2012: 245; 2013: 243; 2014 Est.: 326; 2015 Prog.: 324; 2016 Est.: 386; 2017 Prog.: 413; 2016 Proj.: 490; 2017 Proj.: 560 - Percent of exports of goods and services: 2012: 3.7; 2013: 3.8; 2014 Est.: 4.2; 2015 Prog.: 4.6; 2016 Est.: 5.0; 2017 Prog.: 5.3; 2016 Proj.: 5.9; 2017 Proj.: 6.5 - Percent of government revenue: 2012: 9.7; 2013: 8.6; 2014 Est.: 10.5; 2015 Prog.: 10.8; 2016 Est.: 12.3; 2017 Prog.: 12.0; 2016 Proj.: 12.8; 2017 Proj.: 13.2 ### Balance of Payments (selected annual levels, Billions of CFA francs) - Current account: 2012: -164; 2013: -209; 2014 Est.: -533; 2015 Prog.: -109; 2016 Est.: -374; 2017 Prog.: -127; 2016 Proj.: -256; 2017 Proj.: -572 - Current account excl. grants: 2012: -245; 2013: -410; 2014 Est.: -859; 2015 Prog.: -413; 2016 Est.: -750; 2017 Prog.: -503; 2016 Proj.: -640; 2017 Proj.: -979 - Trade balance: 2012: 1,566; 2013: 1,479; 2014 Est.: 1,731; 2015 Prog.: 1,814; 2016 Est.: 2,149; 2017 Prog.: 2,017; 2016 Proj.: 2,183; 2017 Proj.: 2,114 - Exports, f.o.b.: 2012: 6,189; 2013: 5,953; 2014 Est.: 6,969; 2015 Prog.: 6,538; 2016 Est.: 7,846; 2017 Prog.: 7,185; 2016 Proj.: 7,713; 2017 Proj.: 8,021 - Of which: cocoa: 2014 Est.: 1,722; 2015 Prog.: 1,932; 2016 Est.: 2,400; 2017 Prog.: 2,431; 2016 Proj.: 2,392; 2017 Proj.: 2,719; 2016 Proj.: 2,752; 2017 Proj.: 2,588 - Of which: crude oil and refined oil products: 2014 Est.: 2,004; 2015 Prog.: 1,693; 2016 Est.: 1,584; 2017 Prog.: 1,447; 2016 Proj.: 1,475; 2017 Proj.: 1,210; 2016 Proj.: 1,455; 2017 Proj.: 1,581 - Imports, f.o.b.: 2012: 4,624; 2013: 4,474; 2014 Est.: 5,239; 2015 Prog.: 4,724; 2016 Est.: 5,698; 2017 Prog.: 5,168; 2016 Proj.: 5,530; 2017 Proj.: 5,907 ### Fiscal operations of the central government (levels, Billions of CFA francs) - Total revenue and grants: 2012: 2,621.4; 2013: 3,039.5; 2014 Est.: 3,390.0; 2015 Prog.: 3,293.4; 2016 Est.: 3,851.0; 2017 Prog.: 3,824.4; 2016 Proj.: 4,197.8; 2017 Proj.: 4,652.1 - Total revenue: 2012: 2,540.2; 2013: 2,838.0; 2014 Est.: 3,064.6; 2015 Prog.: 2,989.4; 2016 Est.: 3,474.8; 2017 Prog.: 3,448.2; 2016 Proj.: 3,814.6; 2017 Proj.: 4,245.3 - Tax revenue: 2012: 2,213.0; 2013: 2,408.6; 2014 Est.: 2,645.9; 2015 Prog.: 2,573.3; 2016 Est.: 2,942.4; 2017 Prog.: 2,881.1; 2016 Proj.: 3,265.7; 2017 Proj.: 3,638.0 - Direct taxes (levels): 2012: 720.4; 2013: 765.5; 2014 Est.: 785.1; 2015 Prog.: 741.1; 2016 Est.: 889.4; 2017 Prog.: 820.3; 2016 Proj.: 912.0; 2017 Proj.: 1,035.0 - Indirect taxes (levels): 2012: 1,492.5; 2013: 1,643.1; 2014 Est.: 1,860.8; 2015 Prog.: 1,832.2; 2016 Est.: 2,053.0; 2017 Prog.: 2,060.7; 2016 Proj.: 2,353.6; 2017 Proj.: 2,603.0 - Grants (levels): 2012: 0.0; 2013: 81.2; 2014 Est.: 201.5; 2015 Prog.: 325.4; 2016 Est.: 304.0; 2017 Prog.: 376.2; 2016 Proj.: 376.2; 2017 Proj.: 383.2; 2017 Proj.: 406.7 - Total expenditure: 2012: 3,054.0; 2013: 3,385.6; 2014 Est.: 3,784.8; 2015 Prog.: 3,669.5; 2016 Est.: 4,523.1; 2017 Prog.: 4,500.9; 2016 Proj.: 4,896.0; 2017 Proj.: 5,388.1 - Current expenditure (levels): 2012: 2,436.0; 2013: 2,451.4; 2014 Est.: 2,689.4; 2015 Prog.: 2,677.8; 2016 Est.: 3,053.6; 2017 Prog.: 3,123.3; 2016 Proj.: 3,416.2; 2017 Proj.: 3,779.0 - Capital expenditure (levels): 2012: 615.8; 2013: 934.2; 2014 Est.: 1,095.4; 2015 Prog.: 994.4; 2016 Est.: 1,469.5; 2017 Prog.: 1,377.7; 2016 Proj.: 1,479.8; 2017 Proj.: 1,609.1 - Interest due (levels): 2012: 233.0; 2013: 214.8; 2014 Est.: 207.3; 2015 Prog.: 213.6; 2016 Est.: 286.5; 2017 Prog.: 301.9; 2016 Proj.: 402.8; 2017 Proj.: 460.9 - On domestic debt: 2012: 79.6; 2013: 115.6; 2014 Est.: 118.5; 2015 Prog.: 119.5; 2016 Est.: 172.9; 2017 Prog.: 154.0; 2016 Proj.: 148.9; 2017 Proj.: 155.5 - On external debt: 2012: 153.4; 2013: 99.2; 2014 Est.: 88.8; 2015 Prog.: 94.2; 2016 Est.: 113.6; 2017 Prog.: 147.8; 2016 Proj.: 253.9; 2017 Proj.: 305.4 - Overall balance, including grants (levels): 2012: -432.7; 2013: -346.1; 2014 Est.: -394.8; 2015 Prog.: -376.1; 2016 Est.: -672.1; 2017 Prog.: -676.6; 2016 Proj.: -698.2; 2017 Proj.: -736.0 - Overall balance (cash basis) (levels): 2012: -242.0; 2013: -306.3; 2014 Est.: -514.8; 2015 Prog.: -538.5; 2016 Est.: -772.1; 2017 Prog.: -726.6; 2016 Proj.: -753.5; 2017 Proj.: -776.0 ### Monetary survey (selected levels, Billions of CFA francs) - Net foreign assets: 2012: 1,556; 2013: 1,559; 2014 Est.: 1,772; 2015 Prog.: 1,962; 2016 Est.: 2,234; 2017 Prog.: 2,569 - Central bank: 2012: 1,297; 2013: 1,300; 2014 Est.: 1,546; 2015 Prog.: 1,736; 2016 Est.: 2,009; 2017 Prog.: 2,343 - Banks (memorandum): 259 (consistent across projections) - Net domestic assets: 2012: 3,356; 2013: 3,922; 2014 Est.: 4,579; 2015 Prog.: 5,294; 2016 Est.: 6,040; 2017 Prog.: 6,867 - Credit to the economy: 2012: 2,308; 2013: 2,831; 2014 Est.: 3,446; 2015 Prog.: 4,194; 2016 Est.: 4,923; 2017 Prog.: 5,688 - Broad money: 2012: 4,911; 2013: 5,481; 2014 Est.: 6,351; 2015 Prog.: 7,256; 2016 Est.: 8,274; 2017 Prog.: 9,435 - Currency in circulation: 2012: 1,591; 2013: 1,748; 2014 Est.: 1,864; 2015 Prog.: 2,130; 2016 Est.: 2,429; 2017 Prog.: 2,770 - Deposits: 2012: 3,251; 2013: 3,679; 2014 Est.: 4,424; 2015 Prog.: 5,055; 2016 Est.: 5,764; 2017 Prog.: 6,573 ### External financing requirements and gaps (Billions of CFA francs) - External financing requirements: 2012: -125.2; 2013: -253.5; 2014 Est.: -995.2; 2015 Prog.: -1,037.2; 2016 Est.: -1,401.8; 2017 Prog.: -1,690.9; 2016 Proj.: -729.8 - Current account balance (excluding official transfers): 2012: -244.9; 2013: -410.3; 2014 Est.: -858.5; 2015 Prog.: -412.7; 2016 Est.: -749.8; 2017 Prog.: -503.3; 2016 Proj.: -639.6 - Amortization (including government): 2012: -316.2; 2013: -144.2; 2014 Est.: -229.7; 2015 Prog.: -226.0; 2016 Est.: -232.6; 2017 Prog.: -236.3; 2016 Proj.: -272.3 - Fund repayments: 2012: 5.5; 2013: 0.0; 2014 Est.: 3.4; 2015 Prog.: 3.5; 2016 Est.: 28.5; 2017 Prog.: 28.5; 2016 Proj.: 34.0 - Private capital, net: 2012: 62.6; 2013: 192.5; 2014 Est.: 89.7; 2015 Prog.: -150.5; 2016 Est.: -207.6; 2017 Prog.: -685.3; 2016 Proj.: 151.2 - Change in net external reserves without IMF (- = increase): 2012: 367.7; 2013: 108.5; 2014 Est.: 0.0; 2015 Prog.: -251.6; 2016 Est.: -240.3; 2017 Prog.: -294.5; 2016 Proj.: -3.1 ### Available financing and gaps (selected) - Available financing: 2012: 133.3; 2013: 357.0; 2014 Est.: 938.4; 2015 Prog.: 912.0; 2016 Est.: 1,287.2; 2017 Prog.: 1,312.1; 2016 Proj.: 870.2 - Project financing: 2012: 54.0; 2013: 219.9; 2014 Est.: 259.6; 2015 Prog.: 249.1; 2016 Est.: 461.8; 2017 Prog.: 401.8; 2016 Proj.: 508.9 - Program financing: 2014 Est.: 353.0; 2015 Prog.: 357.0; 2016 Est.: 490.0; 2017 Prog.: 572.1; 2016 Proj.: 0.0 - Fund disbursements: 2012: 101.5; 2013: 72.4; 2014 Est.: 36.4; 2015 Prog.: 36.4; 2016 Est.: 0.0; 2017 Prog.: 0.0; 2016 Proj.: 0.0 - Official transfers: 2012: -22.1; 2013: 64.6; 2014 Est.: 289.4; 2015 Prog.: 269.4; 2016 Est.: 335.4; 2017 Prog.: 338.2; 2016 Proj.: 361.2 - Financing gap (selected): 2014 Est.: -98.9; 2015 Prog.: 1.7; 2016 Est.: -131.3; 2017 Prog.: -126.2; 2016 Proj.: -154.1 ### Financial soundness indicators (banking sector, selected) - Risk-weighted capital to assets ratio: 2010: 12.5; 2011: 9.7; 2012: 8.6; 2013: 9.2; 2014: 7.7; June 2014: 10.1 - Total loans/total assets: 2010: 59.0; 2011: 52.2; 2012: 52.1; 2013: 55.4; 2014: 54.2; June 2014: 58.2/9 (table formatting preserved as presented) - Nonperforming loans (NPLs) (gross)/total loans: 2010: 17.1; 2011: 16.8; 2012: 15.5; 2013: 12.3; 2014: 11.9; June 2014: 10.4 - Provisions/NPLs: 2010: 75.5; 2011: 71.8; 2012: 78.6; 2013: 73.5; 2014: 71.9; June 2014: 77.0 - Liquid assets/total assets: 2010: 40.7; 2011: 36.6; 2012: 35.2; 2013: 37.1; 2014: 35.0; June 2014: 24.9/8/3 (table formatting preserved as presented) ### Proposed schedule of disbursements and timing of reviews under the ECF arrangement (SDR 2011–15, millions) - 25.00 percent of quota — Amount: 81.30 — Date of availability: November 4, 2011 — Condition: Executive Board approval of the three-year arrangement under the ECF. - 20.00 percent of quota — Amount: 65.04 — Date of availability: April 1, 2012 — Condition: Observance of PCs for end-December 2011, continuous PCs and completion of the first review under the ECF arrangement. - 20.00 percent of quota — Amount: 65.04 — Date of availability: October 1, 2012 — Condition: Observance of PCs for end-June 2012, continuous PCs and completion of the second review under the ECF arrangement. - 15.00 percent of quota — Amount: 48.78 — Date of availability: April 1, 2013 — Condition: Observance of PCs for end-December 2012, continuous PCs and completion of the third review under the ECF arrangement. - 15.00 percent of quota — Amount: 48.78 — Date of availability: December 6, 2013 — Condition: Observance of PCs for end-June 2013, continuous PCs and completion of the fourth review under the ECF arrangement. - 15.00 percent of quota — Amount: 48.78 — Date of availability: April 1, 2014 — Condition: Observance of PCs for end-December 2013, continuous PCs and completion of the fifth review under the ECF arrangement. - 20.00 percent of quota — Amount: 65.04 — Date of availability: October 1, 2014 — Condition: Observance of PCs for end-June 2014, continuous PCs and completion of the sixth review under the ECF arrangement. - 15.00 percent of quota — Amount: 48.78 — Date of availability: April 1, 2015 — Condition: Observance of PCs for end-December 2014, continuous PCs and completion of the seventh review under the ECF arrangement. - 15.00 percent of quota — Amount: 48.78 — Date of availability: October 1, 2015 — Condition: Observance of performance criteria for end-June 2015, continuous PCs and completion of the eighth review under the ECF arrangement. - TOTAL: 160.00 percent of quota — Amount: 520.32 ### Letter of Intent (introductory paragraph, May 19, 2015) - Côte d’Ivoire reports considerable progress since the end of the post-election crisis in 2011, placing the country on a path to strong, sustainable, and inclusive growth. - Implementation of the National Development Plan (PND 2012–15) resulted in completion of the first major infrastructure projects related to transport, communication, and water supply. - Political institutions, such as the Independent Electoral Commission, have been reinforced and have the confidence of all political parties and civil society. - Côte d’Ivoire will hold free, democratic, and transparent presidential elections at the constitutionally scheduled date in 2015. *Source: IMF staff report excerpts, Côte d’Ivoire — staff recommendations, tables, and Letter of Intent (as provided in the supplied content).* ### 2. The attached Memorandum of Economic and Financial Policies (MEFP) describes the ### Attachment I. Côte d’Ivoire: Supplement to the Memorandum of Economic and Financial Policies (May 19, 2015) ### Program overview and objectives - Implementation of the program supported by an arrangement under the Extended Credit Facility was satisfactory in 2014. - All the performance criteria and indicative targets at end-December 2014 were met with the exception of the indicative target on fiscal revenue. - Under the seventh program review of the ECF-supported program, the government is requesting financial assistance in an amount equivalent to SDR 48.78 million. - Government vision: turn Côte d’Ivoire into an emerging country by 2020 and substantially reduce poverty. - 2015 macro targets stated: - GDP growth rate of 9.4 percent in 2015. - Inflation rate of 1.7 percent in 2015. - Investment expected to increase from 16.1 percent of GDP in 2014 to 18.6 percent of GDP in 2015, of which 10.7 percent from private investment. - Fiscal stance: prepare a draft supplementary budget; fiscal deficit projected to reach 3.6 percent (consistent with the program performance criteria). - Request to modify program performance criteria on the primary basic balance and net domestic financing as of end-June 2015, as well as the indicative targets, consistent with the program framework. ### Recent macroeconomic performance (2012–2014) and 2014 details - GDP growth: - 10.7 percent in 2012. - 9.2 percent in 2013. - 8.5 percent in 2014. - Per capita GDP rose by more than 21 percent over three years (2012–2014). - Sectoral developments in 2014: - Primary sector growth: 12 percent. - Agricultural exports increased by 2.8 percent. - Cashew production: +15.8 percent. - Cotton seed: +13.3 percent. - Rubber: +9.4 percent. - Sugar: +6.9 percent. - Cocoa production: +0.3 percent. - Secondary sector: public works +15.5 percent; agro-food industries +8.6 percent; mining, petroleum and energy slowed. - Tertiary sector drivers: retail trade +11.1 percent; transportation +9.4 percent (air transport record passengers). - Inflation and prices: - Average price index variation in 2014: 0.4 percent (compared to 2013). - Food prices: -2.1 percent. - Transportation costs: -0.4 percent. - External sector and trade: - Terms of trade improved by 3.2 percent. - Export prices: +5.2 percent. - Import prices: 1.7 percent. - Exports of goods increased by 9.8 percent. - Imports of goods increased by 5.6 percent. - Credit and financial intermediation: - Credit to the private sector: +27.4 percent. - Medium- and long-term credits: +30.5 percent. - Ordinary short-term credits: +13.6 percent. - Ratio of credit to the economy in relation to GDP: 20.4 percent (slight increase). - Banking system indicators: - Capital adequacy ratio: 10.1 percent in December 2014 (9.2 percent in December 2013). - Non-performing loans: 10.44 percent at end-December 2014 (12.3 percent at end-December 2013). - Labor market and business activity: - Formal employment gain: +6.2 percent from end-December 2013. - Private sector employment: +6.6 percent. - Public sector employment: +4.9 percent. - 82 percent of net job creation in the private sector. - Business start-ups: 6,487 businesses created at end-December 2014 (2,775 in 2013). - Private investment in 2014: CFAF 968 billion, +28 percent. - Overall rate of private investment: 9.9 percent of GDP in 2014 (6.7 percent in 2012; 8.3 percent in 2013). - Capital markets: - Stock market capitalization rose year-on-year by 11.4 percent. - Average increase in trading volume: 75.6 percent from 2013. - Regional context: - Côte d’Ivoire marked by a 7 percent increase in GDP within WAEMU. ### Fiscal outcomes and public finances (2014) - Total revenues: CFAF 2,989.4 billion (17.7 percent of GDP) vs. target CFAF 3,064.6 billion (18 percent of GDP); revenue shortfall CFAF 75.2 billion. - Revenue shortfalls attributed to: - VAT exemptions from the investment code and higher-than-predicted VAT refunds. - Lower-than-expected taxes on income and wages due to cash flow constraints. - Shortfall in taxes on investment income (reinvested earnings). - Shortfalls in income from petroleum and gas. - Lower-than-expected export duties and taxes owing to declines in volume and prices. - Mobilized revenues increased by 5.3 percent relative to end-2013 outturn. - Total expenditure: CFAF 3,669.6 billion (21.7 percent of GDP) vs. target CFAF 3,784.9 billion (22.2 percent of GDP). - Operating expenditure (excluding staff-related expenditure, subsidies and post-crisis spending): CFAF 617.4 billion (in line with targets). - Investment expenditure (excluding post-crisis spending): CFAF 994.2 billion (programmed CFAF 1,095.4 billion). - Domestic resources funded 61.2 percent; 38.8 percent externally funded. - Implementation rate of projects funded with external resources: 90.1 percent. - Overall budget deficit: CFAF 376.2 billion, equivalent to 2.2 percent of GDP (target 2.3 percent of GDP). - Financing: - Financing on the regional market: CFAF 1,101.6 billion. - Mobilization of external budget supports: CFAF 144.3 billion. - Successful international Eurobond issuance: US$750 million at 5.625 percent (initial offering US$500 million at 5.875 percent). Proceeds used to lengthen debt maturities and accelerate repayment of domestic arrears. ### Program implementation, debt, and arrears clearance - End-December 2014 program performance: all criteria and indicative benchmarks observed except the floor on tax revenues. - Cash advances (TMU definition): CFAF 112.4 billion (under target ceiling CFAF 124.5 billion). - Floating debt at end-December 2014: CFAF 201.7 billion (moderate level). - Clearance of past payables: - Government cleared CFAF 354.1 billion of debt remaining from 2013 and previous years, leading to a net reduction in payables of CFAF 152.3 billion (target floor CFAF 110 billion). - Pro-poor expenditures: CFAF 1,622.4 billion, above the target floor. - Nonconcessional loans since start-2013: US$2,441.5 million (including Eurobond and port-extension loan), below cumulative ceiling US$2,444.4 million at end-December 2014. - Eurobond details reiterated: US$750 million at 5.625 percent (initial offering US$500 million at 5.875 percent). - Domestic arrears (audit and clearance): - Validated stock at end-December 2014: CFAF 152.9 billion; 69 percent paid. - Audit of domestic arrears (2000–2010) validated CFAF 92.8 billion excluding taxes for private creditors and institutions. - In 2013, government repaid CFAF 56.7 billion of arrears (tax debts CFAF 5.5 billion). - In 2014, state cleared CFAF 26.2 billion of the remaining CFAF 41.7 billion. - Remaining CFAF 15.5 billion breakdown: - CFAF 11.5 billion (of which CFAF 3.0 billion owed for refunds of VAT credits; amount could be converted into treasury securities). - CFAF 3.9 billion in counterfoils [mandats souches] requiring a separate audit. ### Structural reforms, procurement, and regulatory measures - Structural benchmarks at end-December 2014 observed except for restructuring of a new state-owned bank (three months delay in restructuring Société Ivoirienne de Banque (SIB)). - Delay cause: longer-than-expected discussions with prospective buyers on valuation of the state’s shares. - Subsidies: - Subsidies for HVO (Heavy Vacuum Oil) provided to the energy sector: CFAF 40.37 billion. - Public accounts and treasury management: - Detailed timetable for closing public accounts at commercial banks adopted in December 2014. - Action plan adopted for implementing recommendations regarding government accounts; timetable and quantitative indicators for clearing suspense accounts adopted. - Procurement reform: - Decree No. 2014-306 of May 27, 2014 amended Decree No. 2009-259 of August 6, 2009 (public procurement code), reducing procurement timeline to 88 days. - Average procurement time decreased from 322 days at end-2013 to 126 days at end-2014 (from examination of tender documents to contract approval). - Order No. 068/MPMB/CAB of February 21, 2014 established a committee for monitoring procurement deadlines and execution of expenditure. - A general procurement plan and procurement plan developed for 2014 budget management to ensure transactions can be traced and anticipated. - Efforts to update simplified procurement documents and disseminate call for tender documents; new tools being developed to improve estimation of investment budgets and categorization of businesses. *Memorandum of Economic and Financial Policies: Supplement to the MEFP — May 19, 2015.* ### 10. Use of non-competitive procurement contracts declined considerably. Non-competitive ### 10. Use of non-competitive procurement contracts declined considerably. Non-competitive ### Procurement trends and statistics - Non-competitive procurement contracts accounted for 5.6 percent of the government contracts approved in 2014, compared with 10.7 percent in 2013. - Non-competitive procurement contracts accounted for 23 percent of the value of those contracts in 2014, compared with 42.8 percent in 2013. - The average time for procurement decreased from 322 days in 2013 to 126 days in 2014. - The government adopted Decree No. 2014-306 of May 27, 2014, to amend Decree No. 2009-259 of August 6, 2009 establishing the public procurement code, with a view to reducing the overall timeline for government procurement from over 300 days to 88 days. ### Audit of public procurement stock (SIGMAP) - An audit of the public procurement stock was begun in December 2014 to consolidate the database of the public procurement management system (SIGMAP). - The audit covers procurement contracts from 1993 to 2012 contained in the database of the public procurement management system (SIGMAP). - The audit’s goal is to conduct an appraisal of the physical and financial execution of these contracts with a view to consolidating the system’s database. - At the conclusion of the audit, steps will be taken to dissolve unexecuted contracts that can no longer justifiably be maintained. - The government will follow up on contracts that are still of relevance but require review given their age. - The audit will enable appropriate steps to be taken to improve traceability and to conduct more effective monitoring of public procurement management. - The final audit report is expected at the end of the first semester of 2015. ### Reforms implemented to improve public procurement procedures (Box 1) - Adoption, implementation and dissemination of Decree Nos. 2013-404, 2013-405, and 2013-406 of June 5, 2013 and of new tender documents for public works projects, provision of supplies and related services and intellectual services to ensure that standard bidding documents are made available to all public procurement actors and that all national and international bids may be processed. - Design of three (03) simplified bidding documents to serve as reference for projects relating to fuel provision, routine public works and provision of routine supplies, in order to make the bidding process faster and more efficient for procurement stakeholders. - Review of the procedural manual in 2009 to reflect a more simplified version of the public procurement code and again in April 2014 to align it with the procedures and regulations in effect. - Completion of the establishment of procurement units in seven pilot ministries. - Production of procedural guides aimed at improving the design of bidding documents. - Inclusion of a database of reference prices (BDPR) on the website of the Directorate of Public Procurement (DMP). ### Tax administration and revenue collection improvements - Directorate of Large Entreprises (Direction des Grandes Entreprises) reorganized; designation now reserved for taxpayers with a turnover in excess of CFAF 3 billion. - Two Centers for Medium-Sized Enterprises (Centres des Moyennes Entreprises), operational since July 2014, established to improve management and monitoring of taxpayers with a turnover of between CFAF 400 million and CFAF 3 billion. - Launched an electronic land register to allow business professionals to consult online documents relating to land ownership. - Set up an automatic data exchange framework between the Tax and Customs Departments to expand the tax base and strengthen controls. - Begun implementing customs clearance operations at border checkpoints for goods from outside the WAEMU. - Begun to clean up the records for operators who have benefited from special customs arrangements for periods exceeding the periods allowed by regulations. ### Public financial management (PFM) reforms - In June 2014, the National Assembly adopted a new organic budget law and an organic law establishing a transparency code, thereby transposing the WAEMU directives into the national legal framework. - The government adopted four implementing decrees for those laws in July 2014. - Established a committee for monitoring the timely execution of expenditure. - For financial auditors, the timeframe for authorizing payment orders decreased from 8 business days in 2013 to 5 days in 2014. - Efforts to integrate technical ministries in multi-year programming relating to medium-term expenditure continued; 6 additional ministries were integrated in 2014, bringing the total number of ministries covered to 22. ### Business climate and investment promotion outcomes (Box 2 and paragraph 14) - Côte d’Ivoire improved by 30 places in the World Bank Group’s Doing Business ranking between 2012 and 2014 and ranked among the world’s top ten reformers in 2014 and 2015. - Advanced 11 spots in the World Economic Report’s Global Competitiveness Report 2014–15. - Rose by 21 places in the latest rankings published by Transparency International. - Received the prize for the most improved country in terms of mining reform at the Mines and Money conference in London in December 2014. - Selection for the Millennium Challenge Corporation’s Threshold Program noted as recognition of progress in macroeconomic policy, good governance, and transparency. - Specific Doing Business measures included: reduction of company start-up time at the CEPICI Single Window from 48 hours to 24 hours; elimination of the minimum capital requirement for LLCs; reduction in procedures and time for construction permits from 16 procedures and 364 days to 11 procedures and 87 days; reduction in procedures and time for electricity provision from 8 procedures and 55 days to 4 procedures and 28 days; reduction in preparation time of notary documents for property transfer from 10 days to 2 days; launch of the electronic land register; establishment of the One-Stop Window for Foreign Trade (GUCE); establishment of the Commercial Court of Abidjan with an average of 56 days for dealing with commercial disputes. ### Electricity sector financial equilibrium - Effective implementation of the strategy to reduce the deficit in the electricity sector led to significant improvements in the operational accounts of the electricity sector. - Higher than projected use of HVO fuel needed to keep up with domestic demand led to additional costs; the state granted additional support in the amount of CFAF 19.7 billion to help defray those costs. - Transfer rates were negotiated upward for export sales (EDM and Sonabel) for amounts in excess of the agreed quantities on the basis of the real costs of production. - The decline in the per-barrel price of oil, the appreciation of the dollar, and delays in defraying costs incurred by the use of HVO fuel delivered to the electricity sector are expected to have an adverse impact on the operational and treasury accounts of the Ivoirian Refinery Company (Société Ivoirienne de Raffinage (SIR)) and the National Petroleum Operations Company (Société Nationale des Opérations Pétrolières (PETROCI)). ### Financial sector development and banking measures - A financial sector development strategy was adopted at the beginning of 2014 aimed at improving access to financial services and addressing legal and judicial obstacles. - The government adopted a Financial Sector Development Program (PDESFI) to implement the strategy, including action plan implementation, design and monitoring of projects to support financial inclusion and development of leasing, and programs related to support of the country’s financial sector. - Microfinance sector capital improved from CFAF -10.9 billion in 2013 to CFAF -3.3 billion in 2014, linked to a 39.2 percent rise in credit volume to households and SMEs. - Progress in public bank restructuring included the liquidation of the Bank for Agricultural Financing (Banque pour le financement de l’agriculture (BFA)) in December 2014 and the transfer, in March 2015, of 44 percent of shares that were held by the state in the SIB. ### Social policy actions and results - Social housing: first complexes expected to be delivered in 2015. - Employment: implementation of the national strategy for boosting employment (Stratégie Nationale de Relance de l’Emploi (SNRE)) with activities including strengthening existing programs, establishing trainee positions for first-time employment, and improving job market information; a jobs forum was organized in Abidjan. - Gender: Women’s Support Fund of Côte d’Ivoire (FAFCI) with a budget of CFAF 1.5 billion and additional private sector funding of CFAF 500 million focused primarily in the interior, particularly on women in rural areas. - Agriculture: coffee-cocoa sector reform; establishment of a guaranteed price system for cotton and cashew producers; Rural Investment Fund (FIMR) increased investments in basic infrastructure; rubber sector tax relief arrangement established. - Education: more than 15,000 classrooms built since 2012; number of school cafeterias increased by 6000 in 2014; free textbooks distributed to more than 3 million students in 2014; gross primary school admission rate increased from 73.4 percent in 2008 to 97.8 percent in 2014; gross school enrollment rate increased from 76.2 percent in 2008 to 94.7 percent in 2014. - Health: contingency plan of CFAF 57.1 billion adopted for Ebola prevention; establishment of 16 treatment centers, a medical laboratory in Abidjan, and strengthened prevention and awareness-raising efforts nationwide; universal health coverage (CMU) facilities now able to provide basic healthcare to all members of the population. - Pro-poor expenditure was registered at CFAF 1,622.4 billion at end-2014, or 9.6 percent of GDP, versus 8.6 percent of GDP in 2013. These expenditures increased by 21.3 percent with respect to end-December 2013. ### Key results from the 2012–15 PND (Box 3) - Per capita GDP increased by 21 percent during the period from 2012 to 2014. - Road and transport infrastructure: completion of the northern highway (Abidjan–Yamoussoukro), the Riviera II highway interchange, and the Henri Konan Bédié, Bouaflé and Jacqueville bridges; 140 km of the Gesco–Singrobo highway reinforced; paving completed for 86 km of the Singrobo–Yamoussoukro section and for 120 km of the Boundiali–Tengrela section; more than 5000 km of rural roads upgraded. - Social sectors: number of jobs in the formal sector increased from 722,567 in 2012 to 756,597 in 2013, and again to 799,890 in 2014. - Education infrastructure: 9,291 primary school classrooms built, in addition to 3,500 secondary school classrooms and 45 middle schools. - Water access: construction of 794 pumps and 76 water towers; maintenance performed on 11,446 human-powered pumps; Abidjan’s water treatment station now operates with a ground storage capacity of 10,000 m3. - Social housing: commencement of 71 social housing construction projects and allocation of 3,060 hectares of land for the low-cost social housing program. - Electricity access: efforts to connect roughly 800 rural towns to the electrical power grid and to ease service subscription costs for households increased rates of access and coverage. - Private sector investment during 2012–2014 amounted to CFAF 4,699 billion, compared with the predicted level of CFAF 3,946 billion, a 118.3 percent implementation rate. *International Monetary Fund — Côte d’Ivoire staff report excerpt (sections 10–18 and Boxes 1–3).* ### 19. The government will work to maintain strong, sustainable, inclusive, gender-sensitive ### 19. The government will work to maintain strong, sustainable, inclusive, gender-sensitive and environmentally conscious growth in a stable macroeconomic environment ### Strategic framework, PND, and development objectives - Finalize a new PND 2016–20 framework before end-June 2015 based on recommendations from the report on the implementation of the PND 2012–15 (published March 2015). - Effective implementation of PND 2016–20 expected to help Côte d’Ivoire achieve its goal of becoming an emerging economy by 2020 and lead to a substantial reduction in poverty. - Funding of the public portion of the new PND: - Emphasis on mobilization of domestic resources and on expenditure control. - Mobilization of external resources to follow the medium-term debt management strategy to preserve debt sustainability. ### Reforms: business climate, governance, gender, and environment - Continue proactive reforms to improve business climate, transparency, good governance, and competitiveness. - Target benchmarks: - Place Côte d’Ivoire in the upper 50% of countries ranked at the top of the World Bank’s Doing Business ranking, Transparency International’s anti-corruption ranking, and the global competitiveness ranking issued by the World Economic Forum. - Rise considerably in the UNDP’s human development ranking. - Gender and environment initiatives: - Accelerate implementation of the policy for the economic empowerment of women and revitalize the Institutions for the Training and Education of Women (IFEF). - Environmental efforts to improve and strengthen environmental conditions, oversee protection and reforestation of the forest canopy, and account for effects of climate change. ### A. Macroeconomic framework — growth, inflation, external accounts, and money supply - Growth projections: - GDP growth rate expected to reach 9.4 percent in 2015 and 9.6 percent in 2016–17. - Investments projected: - Increase by 25.1 percent and amount to 18.6 percent of GDP in 2015. - Increase by 17.5 percent in 2016 to reach 20.2 percent of GDP. - Increase by 12.4 percent in 2017 to reach 21.1 percent of GDP. - Sectoral drivers (2015): - Primary sector: driven by subsistence farming, PNIA implementation since 2012, improved export processing (cocoa, cashews, cotton). - Secondary sector: construction and public works, manufacturing and agro-food industries, mining and energy production stimulated by investments. - Tertiary sector: transportation, telecommunications, and growth in regional/international conferences with ADB return to Abidjan in late 2014. - Food self-sufficiency and industrial processing: - Self-sufficient levels of rice production targeted for 2016/2017. - New industrial policy aimed to allow for 50 percent of basic commodities to be processed locally. - Inflation and external accounts: - Average annual inflation expected to remain moderate at 1.7 percent in 2015. - Current account balance deficit expected at -1.2 percent of GDP in 2015. - Trade balance expected to continue to post a surplus despite increased imports. - Capital and financial operations account expected to post a surplus due to increases in portfolio investment and foreign direct investment. - Overall balance of payments expected to record a surplus of CFAF 60 billion (0.3 percent of GDP). - International economic factors (decline in crude oil prices and depreciation of the euro against the dollar) expected to improve terms of exchange and price competitiveness. - Monetary aggregates: - Money supply expected to grow by 11 percent, driven by increased credits to the economy and net foreign assets. ### B. Public Financial Management — revenue, expenditure, debt, and specific fiscal measures - Revenue and tax reforms: - Total tax revenues in 2015 expected to increase to CFAF 2,881.1 billion or 15.3 percent of GDP (versus 15.2 percent of GDP in 2014). - Drivers: expected growth of direct and indirect tax revenues, particularly non-oil corporate profits taxes (14.2 percent), VAT (15.6 percent), and payroll taxes (17.6 percent). - Tax reform measures highlighted: - Operationalizing Centers for Medium-Sized Enterprises (CME). - Developing excise tax bases on tobacco and beverages by fixing a minimum price. - Decentralizing tax control and securing local tax frameworks. - Modernizing tax management by introducing online tax reporting. - Simplifying business tax systems. - New VAT credit management procedure to speed payments and improve monitoring; aim to process VAT credit refund files in a timely manner. - Acquire at least one mobile scanner to improve customs clearance control at border checkpoints. - Integrate 7 additional ministries into program budget preparation under the multi-year medium-term expenditure program. - Expenditure and budget aggregates: - Expenditure in 2015 expected to increase to CFAF 4,500.9 billion or 23.9 percent of GDP (versus 22.7 percent of GDP in 2014). - Expenditure drivers: revaluation of wages and income in public administration; increased public investment; strengthening social policy with the launch of CMU; policies dedicated to underprivileged populations (CFAF 1,716.4 billion); organization of elections. - Securitized and agreed debt: - Total predicted amount CFAF 142.9 billion; 69.9 percent treated through the bond issued by the Treasury in December 2014. - Remainder to be exchanged for new market securities, considering current maturity profiles. - Energy sector subsidies and HVO: - HVO consumption initially projected at CFAF 31 billion but ultimately registered at CFAF 50.7 billion, an overrun of CFAF 19.7 billion. - Audit of debts and cross-debts at end-2014 established a net requirement of approximately CFAF 8.3 billion to cover relevant debts; amount to be reflected in the 2015 state budget. - Next maturities of securitized debt to be paid up to CFAF 56.9 billion through market issuances to improve SIR cash flow. - Establish consultation framework for monthly examinations of liquid fuel consumption (HVO) needs to avoid unanticipated budget overruns. - Budget adjustments for 2015: - Education and training sector requested additional CFAF 36 billion for the 2014-2015 academic year: - CFAF 12 billion financed through budgetary reallocations. - CFAF 24 billion financed through upward budgetary adjustments. - Government to audit liabilities from school fees amounting to CFAF 46.7 billion and sign, before end-2015, a memorandum of understanding for treatment of these debts with private school administrators. - Additional CFAF 4 billion to fully cover fuel needs in 2015. - Liabilities of CFAF 22.4 billion from past budget overruns to be treated via agreement for repayment of debts and cross-debts between the government and the energy sector. - General audit of liabilities: - Conduct a general audit of liabilities incurred during 2000 to 2010 by the Inspection Generale des Finances, excluding liabilities from school fees, HVO subsidies, and fuel. - Results expected during the second half of 2015. - Government confirmed no recognized state debt liabilities currently exist apart from those identified in the memorandum; these liabilities are extra-budgetary expenditures executed outside the expenditure chain. - Prevention of extra-budgetary liabilities and budget execution controls: - Establish an information unit within the General Directorate of Budget and Finance to inform economic agents on availability of budgetary allocations and explain public financial procedures (including procurement and spending execution). - Strict enforcement of regulatory mechanisms imposing sanctions for non-compliance with budget execution procedures, per article 35 and article 36 of Decree No. 98-716 of December 16, 1998. - Ensure public financial management procedures observed for fuel expenditures. - Explore creation of a chamber for enforcement of budgetary discipline in the context of establishing the court of auditors. - Fiscal aggregates and balances: - Basic primary balance expected at CFAF 90.6 billion or -0.5 percent of GDP (versus -0.5 percent in 2014). - Overall budget deficit, including grants, expected to be CFAF 676.5 billion (or -3.6 percent of GDP, compared with -2.2 percent of GDP in 2014). - Measures to improve budget execution and rationalize expenditures: - Limit recourse to cash advances to emergency situations. - Reduce the number of régies d’avance. - Use the database of reference prices effectively. - Reduce public procurement granted on a non-competitive basis to 20 percent of the total number of procurement contracts approved. - Ensure compliance with inter-ministerial Order No. 0011 MPMB /MPMEF/CAB of November 29, 2013 on regulatory measures for use of provisional payment orders. - Good governance and anti-corruption actions: - Reinforce the high authority on good governance tasked with fighting corruption. - Strengthen control of government contracting management by simplifying procedures, providing training and information for procurement chain actors, and reducing procurement timetables. - Establish audit committees within executive boards of public companies and require yearly governance assessments by public companies and companies in which the state is a majority stakeholder. - Strengthen legal framework for public enterprise management via adoption of implementing decrees and develop a computer application for public enterprise management. ### C. Improving management and strengthening long-term viability of public finances - Adopted master plan for public financial reform and reform of internal and external controls covering 2014 to 2016: - Plan includes strategic actions related to budget, fiscal, procurement, accounting, and treasury reform to develop a modern public financial management system aligned with international standards. - Energy sector investment and subsidy reduction: - Investments totaling CFAF 5,300 billion devoted to building new production facilities or overhauling existing sites using new inputs (including biomass) and improving transmission and distribution networks. - Increased supply of gas from investments expected to obviate the need for HVO and enable progressive reduction of government subsidies to the electricity sector. - Energy sector management and HVO monitoring: - Issue a call for bids by end-June 2015 to recruit consultants for a strategic diagnostic study of the SIR. - Adopt a protocol for treatment of HVO deliveries and payments by end-June 2015. - Hold monthly technical meetings among the Ministry of Petroleum and Energy, the Ministry for Budgetary Affairs, the Ministry of Economy and Finances, and energy sector actors to monitor HVO consumption. - Define terms governing fuel supply to reduce budgetary overruns. ### D. Treasury Single Account (TSA) and public accounts consolidation - Establish a Treasury Single Account (TSA) to centralize government treasury operations. - Close 1,400 out of a total of 2,500 public accounts held with commercial banks. - Close dormant accounts at end-April 2015 after accounting instructions are drafted/updated. - Treat remaining accounts progressively over the next three years to safeguard financial system stability. - Implementation to begin in 2015 with testing on four account headings. - Awareness meetings underway with government units holding commercial bank accounts and senior management of those banks. ### E. Consolidation and development of the financial sector - Implement the program to develop the financial sector (PDESFI): - Program director to be named by end-June, 2015. - Adopt a draft law on leasing by end-September 2015 to develop leasing usage. - Ensure banks comply with regulations adopted by the Central Bank of West African States (BCEAO) and the Banking Commission to improve banking soundness. - Restructuring of public banks: - Transfer a majority of shares to another bank with a minority share; privatization committee to expedite discussions with purchasers regarding selling price of state shares. - For four banks where the state is a majority shareholder, name a program director by end-June 2015 under a steering committee to conduct privatization or resizing strategies while maintaining public service functions (financing the economy, savings, and availability of bank services). - Microfinance sector overhaul: - Strategic orientations: - Revoke licenses held by non-viable institutions and exercise caution in granting prior authorization to operate. - Strengthen supervision through enforcing sanctions and regulations. - Provide support for microfinance in the national strategy for financial inclusion. - Measures include support under two agreements with the French Development Agency (AFD) for training, technical assistance, research, capacity-building, review of license applications, and off-site and on-site audits. - Aim to consolidate a portfolio of sound, credible, and viable microfinance structures to support cost-effective access to financing for the poorest sectors of the population. *International Monetary Fund — Côte d’Ivoire country memorandum (extracted content).* ### 44. The government will support the BCEAO’s efforts to improve access to financial ### 44. The government will support the BCEAO’s efforts to improve access to financial services and bring about a reduction in the cost of financial operations ### Access to financial services and credit bureaus - The government will support the BCEAO’s efforts to improve access to financial services and reduce the cost of financial operations. - The government will undertake, in conjunction with the BCEAO, all of the steps necessary to finalize the establishment of credit bureaus during 2015. - A leading company in this area has already been selected following a call for bids. - Instructions adopted by the BCEAO establish sanctions against violators of measures providing some banking services free of charge. ### E. Debt Policy and Strategy - The government will continue to strengthen public debt management in accordance with the medium-term debt management strategy (SDMT 2015–19) adopted in 2014. - The SDMT 2015–19 outlines actions for optimal management of debt instruments in 2015 and incorporates sustainability analysis needed to ensure debt sustainability. - Efforts to develop a centralized database on the debt of public enterprises and government guarantees on that debt should be completed before end-June 2015 to enable improved monitoring of debt incurred by public enterprises. - The government will complete, before end-June 2015, the reorganization of the Directorate of Public Debt (DDP) in the front, middle, and back offices based on IMF technical assistance recommendations to ensure comprehensive public debt management. - The government intends to assess the performance of debt management (DEMPA) with the technical assistance of the World Bank, following the reorganization of the DDP. ### Measures to develop the sub-regional financial market - The government intends to undertake measures aimed at developing the sub-regional financial market with IMF and World Bank support. - Particular emphasis: reopening already existing bond facilities (increasing the total number of bonds within a given category). - In the context of implementing the TSA mechanism (expected to promote pro-active management of cash flow and debt), the government will progressively resume issuance of very-short term securities (1, 3, 6 months), which may potentially be issued at floating rates and for refinancing purposes. - The government will improve communication with the market by publishing its medium-term debt management strategy (SDMT) on its website or by other appropriate means. - The success of these measures depends on adequate strengthening of technical capacities needed to conduct active cash position management and management of refinancing risk. ### Diversifying sources of funding - The government will continue to diversify sources of funding to implement its development policy. - Due to increasing scarcity of concessional resources in 2015, the government will continue to diversify funding in line with its debt strategy. - The government is exploring the possibility of participating in Islamic financial markets by issuing Sukuk to complete certain projects under the 2012–15 PND. - In 2015, non-concessional external loans contracted over the period 2013–15 have been limited to a ceiling of US$3.843 billion (including the Eurobond), with the possibility of adjusting the ceiling upward by a maximum amount of US$820 million to include development and rehabilitation of Côte d’Ivoire’s electrical grid, in the event the terms were nonconcessional. ### F. The Private Sector as a Driver of National Economic Growth - The government will pursue structural and sector reforms to improve competitiveness and make the private sector the main engine of growth. - Efforts to reinforce economic infrastructure (telecommunications, the road system, energy, and port facilities) and to create, rehabilitate, and extend industrial zones will be redoubled as part of industrialization policy. - The government will develop health services and a pharmaceutical industry that produces generic medications to make Côte d’Ivoire a hub for hospital services in the sub-region. - An assessment of training and employment policies will guide more effective targeting of training programs to provide companies with a well-qualified workforce and to support innovation by entities involved in research and training. - Continued implementation of the PNIA will improve food security and promote agro-industrial sector development. - Results of the General Population and Housing Census and of the household survey will be used to better define and guide sector and anti-poverty policies. ### Business climate reforms (Box 4) — objectives for 2015 - Continue efforts to improve the business climate, focusing on Doing Business indicators and drawing on World Bank and CEPICI recommendations. - Specific aims for 2015: - Promote electronic, geographically-unified management of the registry of guarantees under the Trade and Personal Property Credit Register (Registre du Commerce et du Crédit Mobilier – RCCM) with a database indexed by debtors’ names. - Promote the dissemination of information up to 3 years old from BCEAO’s Centrale des Risques (credit risk database). - Reduce the time for moving import and export merchandise at ports. - Establish a legal framework for trade mediation. - Revise articles 31 and 39 of Decision No. 01/PR on the creation, organization, and functions of commercial courts to endow the president of the Commercial Court with authority to enforce decisions. - Encourage the completion of insolvency proceedings by the relevant professionals. - Guarantee quality of construction projects by introducing a building permit issuing mechanism based on risk management. - Improve the security level of real estate transactions by incorporating technological solutions and expediting formalities for real estate transfers by introducing electronic publication. - Make credit bureaus operational in Côte d’Ivoire. - Establish and organize a group of mediators on trade and commercial matters. - Introduce online business start-up procedures. - Strengthen procedures for quality control of electrical equipment on the market. - Establish a prior, external examination of transactions presenting conflicts of interest to enable auditors to issue their opinion prior to completion of such transactions. - All efforts aim to contribute to improving Côte d’Ivoire’s ranking in the 2016 Doing Business report. ### SME and industrial sector promotion - The government will continue to promote SMEs and industrial sector development, focusing on implementing the Phoenix program to support SME creation and development. - Coherence ensured through the framework law for promotion and development of SMEs and establishment of an SME development agency to coordinate policies and actions. - A National Program for the Restructuring and Upgrading of Industries (PNRMN), launched for a total amount of CFAF 152 billion, is being implemented to strengthen operating and management capacities of SMEs and Small and Medium-Sized Industries (SMIs). - The government has undertaken efforts to sign agreements with banks to promote SME financing. ### G. Employment and Social Policy - The government will pursue the 2014–15 operational action plan under the national strategy for boosting employment. - Actions include developing a database to identify potential trainees, producing and periodically disseminating an employment scoreboard (tableau de bord), implementing a decentralized job creation strategy through regional divisions and AGEPE branches, strengthening self-employment promotion initiatives, and continuing labor market monitoring via surveys and employment-related research. ### Social protection, healthcare, and education measures - The government will promote enrollment in the CMU; the registration period has begun. - The government will continue to ensure that producers of cacao, coffee, cashews and cotton receive 60 percent of the “farm gate” price (prix bord champ) for their products. - Law No. 2014-131 establishing the CMU was adopted by the National Assembly on March 6, 2014 and published on March, 24, 2014; CMU provides health insurance for CFAF 1,000/month per person. - To operationalize CMU, the National Healthcare Development Plan (PNDS 2012–15) implementation will be stepped up with focus on: - Launching a special program to extend coverage in first-contact facilities. - Rehabilitating and re-equipping emergency care services. - Re-organizing admission channels for emergency patients and introducing new emergency management procedures. - Developing regulatory hospital mechanisms to reduce overcrowding. - Improving distribution of healthcare staff and achieving equitable geographic distribution of healthcare facilities. - Rehabilitating and re-equipping maternity wards. - The 2016–20 PNDS will be drafted and approved to begin implementation in 2016. - The government will use CFAF 24 billion provided by the IMF to prevent outbreak and spread of epidemics like Ebola by improving the healthcare system. - Education: implement the “universal schooling” program (funding being secured) to establish middle schools in local communities and extend technical and professional high schools. - Program will: (i) make school enrollment obligatory for all children up to the age of 15; (ii) allow for the recruitment of more than 20,000 teachers; (iii) enable establishment of distance training programs for teachers; (iv) promote acceleration of literacy programs, particularly in bus terminals and markets. - Curriculum reforms: introduce courses on information technology and communications, financial management, business, and human rights; develop textbooks for teachers. - The government intends to fulfill commitments in the Sahel Women’s Empowerment and Demographics Project financed by the World Bank in the amount of US$30 million. ### Program financing and monitoring - The government deems the funding needs of the 2015 program will be met. - Additional financing to be mobilized on the regional money market, international financial market, and from foreign partners. - The government intends to raise CFAF 648.7 billion on the sub-regional money and financial markets, compared with CFAF 1,101.6 billion in 2014. - External financing, including budget support, is expected to amount to CFAF 1,100.1 billion, owing in part to assistance from the World Bank, IMF, African Development Bank, European Union, French Development Agency, Islamic Development Bank, and Eximbank China. - The government issued a Eurobond in the amount of US$1 million in 2015. - The government is exploring issuing Sukuk in national currency in 2015. - The government will continue bilateral discussions with remaining creditors regarding debt relief under the Heavily Indebted Poor Countries (HIPC) initiative. ### IMF program monitoring and commitments - The program will be monitored biannually by the IMF Executive Board on the basis of quantitative indicators and structural benchmarks (Tables 1 and 2). Indicators are defined in the Technical Memorandum of Understanding (TMU). - The eighth review will be based on performance criteria and indicative targets at end-June 2015, and structural benchmarks centered on public expenditure management, financial soundness and business climate. The eighth review is expected to be completed by December 2015 at the latest. - The government undertakes to: - Refrain from accumulating new domestic arrears and from any kind of advances on revenue, as well as from contracting any nonconcessional external borrowing other than that specified in the TMU. - Issue government securities only by auction through the BCEAO or through any other form of competitive bidding on the local financial market and the WAEMU market, and to consult with IMF staff on any new financing. - Refrain from introducing or intensifying any restrictions on payments and transfers related to current international transactions and from introducing multiple currency practices or entering into bilateral payment agreements that are inconsistent with Article VIII of the IMF Articles of Agreement, or from imposing or intensifying import restrictions for balance of payments purposes. - Adopt any new financial or structural measures that may prove necessary for the success of its policies, in consultation with the IMF. ### Statistics and capacity-building - The government will further develop the statistical system by completing implementation of the 2012–15 statistics master plan aligned with the 2012–15 PND. The master plan comprises: - Conducting national and sector surveys. - Strengthening and monitoring economic indicators. - Setting up a database for the Integrated Information Management System. - Changing the base year of national accounts and establishing quarterly national accounts. - Reforming the Harmonized Consumer Price Index (HCPI). - Preparing a directory of ministerial statistical offices. - Final reports from the 2013/2014 General Population and Housing Census and from the employment survey are now available. - Analysis of household survey and General Agricultural Survey data is currently being conducted. - A new classification system for activities and products has been developed and published; the year 2014 was chosen as the new base year for the annual national accounts. - Good progress has been made toward preparation of the quarterly national accounts; efforts to produce a breakdown of government financial operations based on the 2001 GFSM are being undertaken and may be completed by the end of December 2015. - Côte d’Ivoire intends to migrate to the Special Data Dissemination Standard to gain access on better terms to international financial markets. ### Capacity-building and technical assistance needs for 2015 - The National Governance and Capacity-Building Secretariat will assist public entities with training needs assessment, program design, and financing arrangements. - Technical assistance needs identified for 2015: - Modernization of the customs administration, especially on economic regimes and risk analysis systems. - Support for setting up quarterly accounts. - Strengthening the tax administration, especially of the tax base and the VAT. - Preparation of balances of payment forecasting. - Tax revenue forecasts. - Support for production of the government financial operations table (TOFE) in accordance with the 2001 GFSM. - Support for developing short-term economic indicators for the real sector. - The government is requesting an IMF technical assistance arrangement of at least one year to create and establish long-term financing instruments in local currency on the international market in support of the two CFAF zones (WAEMU and CEMAC). *Source: _cr15147 - 44. The government will support the BCEAO’s efforts to improve access to financial services and bring about a reduction in the cost of financial operations (PDF chapter).* ### 113.1 Not Met ### _cr15147 - 113.1 Not Met ### Program performance indicators and fiscal ceilings — reported values and compliance - Ceiling on new nonconcessional external debt (in $ million): - 900.0; 717.3 — Met - 900.0; 738.4 — Not Met - 3/ 900.0; 1,488.6 — Not Met - 1,650.0; 2,443.4; 2,441.5 — Met - 3,050.0; 3,843.4 - 3,050.0; 3,843.4 - 3,050.0; 3,843.4 - 3,050.0; 3843.4 - Ceiling on accumulation of new external arrears: - 0.0; 0.0 — Met (repeated series: all entries 0.0) - Ceiling on accumulation of new domestic arrears: - 0.0; 0.0 — Met (repeated series: all entries 0.0) - Floor on the overall fiscal balance (including grants) — reported cumulative values: - -76.1; -81.7 — Met - 7/ -310.6; -143.4 — Met - -364.5; -356.1 — Met - -394.8; -376.1 — Met - -179.3; -331.0; -451.2; -533.2; -584.7; -672.1; -676.6 - Ceiling on expenditures by treasury advance — cumulative values and compliance: - 19.8; 25.8 — Met - 55.6; 54.6 — Met - 81.5; 80.5 — Met - 124.5; 112.4 — Met - 29.4; 63.4; 74.7; 107.7; 109.9; 146.1; 144.9 - Floor on pro-poor expenditure — cumulative values and compliance: - 259.4; 300.4 — Met - 676.7; 717.8 — Met - 1,022.3; 1,086.1 — Met - 1,521.8; 1,622.4 — Met - 292.6; 763.3; 763.3; 1,153.1; 1,153.1; 1,716.4; 17; 16.4 - Floor on net reduction of government amounts payable ( - = reduction) — cumulative values and compliance: - -5.0; -85.8 — Met - -50.0; -129.7 — Met - -70.0; -170.9 — Met - -110.0; -152.4 — Met - -20.0; -50.0; -30.0; -70.0; -40.0; -100.0; -50.0 - Floor on government revenue — cumulative values and compliance: - 621.8; 659.9 — Met - 1,392.1; 1,462.3 — Met - 2,167.9; 2,167.7 — Not Met - 3,064.6; 2,989.4 — Not Met - 749.5; 1,642.2; 1,630.5; 2,486.4; 2, 472.8; 3,474.8; 3,448.2 - Memorandum items (selected series, cumulative values as reported): - Net banking sector claims on government: 11.3; 61.5; 129.3; 122.9; 17.4; 29.5; 9.1; 127.3; -41.0; -11.9; 54.8; -35.1; 1.4; -24.5; -33.9 - Program grants: 0.0; 9.0; 82.8; 82.8; 82.8; 82.8; 156.6; 167.0; 0.0; 73.8; 73.8; 73.8; 73.8; 147.6; 147.6 - Program loans: 0.0; 0.0; 0.0; 0.0; 0.0; 0.0; 50.5; 0.0; 0.0; 0.0; 6.4; 0.0; 6.4; 58.4; 46.4 - Project grants: 44.3; 54.4; 123.3; 113.7; 166.0; 125.3; 168.8; 137.0; 57.2; 114.3; 114.3; 137.2; 137.2; 228.6; 228.6 - Project loans: 61.3; 73.5; 170.7; 134.1; 229.9; 218.7; 259.6; 249.1; 115.5; 230.9; 241.1; 277.1; 281.2; 461.8; 401.8 ### Structural benchmarks — implementation status (2014–15) - Table 2a. Côte d’Ivoire: Structural Benchmarks, 2014–15, ECF — Seventh Program Review (selected benchmarks and status) - Public expenditure management: - Pay subsidies to support the electricity sector (HVO [Heavy Vacuum Oil]) in the amount of CFAF 40 billion — Reduce fiscal risks — SB end-December 2014 — Met - Adopt a detailed timetable for closing public accounts at commercial banks — Improve cash-flow management — SB end-December 2014 — Met - Restructuring of banking sector: - Restructure a state-owned bank — Reduce banking sector vulnerabilities and fiscal risks — SB end-December 2014 — Not met (implemented with delay in February 2015) - Improving the business environment: - Limit the current fiscal year’s VAT arrears pending refund to under CFAF 10 billion — Improve business climate — Continuous SB — Met - Implement plan to settle the full range of domestic arrears on audited debt, securitized and agreed debt — Improve business climate — SB end-December 2014 — Met - Table 2b. Côte d’Ivoire: Proposed Structural Benchmarks, 2015 — Eight Program Review (selected proposed SBs and timeframes) - Public expenditure management: - Payment in cash of the securitized debt held by SIR and PETROCI — Improve the financial position of the energy sector — SB end-June 2015 - Adopt a protocol clarifying the responsibilities of the respective parties, including the government, as regards the payment of HVO — Reduce fiscal risks — SB end-June 2015 - Issue a call for tender for the selection of an audit company that would complete a strategic audit aiming to restructure SIR — Reduce fiscal risks — SB end-June 2015 - Strengthening the soundness and development of the financial sector: - Adopt a draft law aimed at developing leasing — Develop the financial sector — SB end-September 2015 - Restructure a public bank — Strengthen financial sector soundness — SB end-November 2015 - Improving the business environment: - Limit the current fiscal year’s VAT arrears pending refund to under CFAF 10 billion — Continuous SB - Clear the full range of domestic arrears on audited debt from 2010 and earlier years — SB end-September 2015 - Regularize domestic arrears on securitized and contractual debt (“dette conventionnée”) — SB end-September 2015 ### Technical Memorandum of Understanding (TMU) — key definitions and monitoring rules - Coverage and timing: - TMU dated May 19, 2015. PCs and ITs are set for June 30, 2015; same variables are ITs for September 30, 2015 and December 31, 2015. - Cumulative change baseline: from December 31, 2014 for 2015 targets, except new nonconcessional external loans where cumulative change starts from December 31, 2012. - Performance criteria (PC) and indicative targets (IT): - PCs include: - a floor on the primary basic fiscal balance; - a ceiling for net domestic financing (including issuance of securities in CFA); - a ceiling on new nonconcessional external debt; - a zero ceiling for accumulation of new external arrears; - a zero ceiling for accumulation of new domestic arrears. - ITs include: - a floor on the overall fiscal balance (including grants); - a ceiling on expenditures by treasury advance; - a floor on “pro-poor” expenditures; - a floor on the net reduction of government amounts payables; - a floor on total government revenue. - Government revenue (IT): - Defined as all revenue collected by DGI, DGTCP, DGD, CNPS, CGRAE, and other nontax revenue as defined in TOFE. - Pro-poor expenditures (IT): - Derived from the detailed list of “pro-poor expenditures” in the SIGFIP system (see Table 1). - Treasury advances (IT): - Defined as spending paid by the Treasury outside normal and simplified execution and control procedures, not subject to prior commitment and authorization; exclusions and nominative list defined in ministerial Decree No. 178/MEF/CAB-01/26 of March 13, 2009. - Cumulative amount of expenditures by treasury advance will not exceed the cumulative quarterly ceilings representing 10 percent of quarterly budget allocations (excluding externally financed expenditures, wages, subsidies and transfers, and debt service). - Primary basic fiscal balance (PC) — definition: - Tax and nontax revenue (excluding grants) – {Expenditure + Net lending – Interest payments – Externally-financed capital expenditure – Expenditure related to the Ebola outbreak (on a payment order basis for all expenditure items)}. - Floor adjusted downward (upward) for an excess (shortfall) of external budget support (program grants/loans) relative to programmed amount. - Overall fiscal balance (including grants) (IT) — definition: - Tax and nontax revenue + (Grants – World Bank budget support grants – AfDB budget support grants) – {Expenditure + Net lending (on a payment order basis for all expenditure items)}. - Floor adjusted downward (upward) for an excess (shortfall) of project loans relative to programmed amount. - Net domestic financing (PC) — definition: - Net domestic financing = Variation of banking system’s net claims on the government (TOFE) + net non-bank domestic financing (excluding the variation of the amounts payable) + borrowing denominated and serviced in Francs of the Financial Community of Africa (FCFA) + financing margin of CFAF 10 billion. - Ceiling includes a margin of CFAF 10 billion above the net cumulative flow projected for each quarter. - Exclusions: new agreements on restructuring domestic debt and securitization of domestic arrears; new project loans from BIDC up to specified conditions. - For any new borrowing over and above a cumulative amount of CFAF 50 billion during 2015, government undertakes not to issue government securities except by auction through the BCEAO or through competitive public auction on the WAEMU financial markets registered with CREPMF, in consultation with Fund staff. - New nonconcessional external debt (PC) — definition and ceiling: - Debt definition per Executive Board Decision No.6230-(79/140), Point 9, as revised on August 31, 2009 (Decision No. 14416-(09/91)); includes loans, suppliers' credits, leases (PV at inception), arrears, penalties, judicially awarded damages that constitute debt. - External debt is debt borrowed or serviced in a currency other than the FCFA. - PC applies to all nonconcessional external debt irrespective of maturity, contracted or guaranteed by the government; applies also to commitments contracted or guaranteed for which no value has been received. - Exceptions (PC does not apply to): normal import-related commercial debts maturing < 1 year; rescheduling agreements; debts to BIDC up to equivalent of CFAF 20 billion for Jan 1–Dec 31, 2015; drawings on the IMF. - Concessional if grant element ≥ 35 percent, NPV calculated with a 5 percent discount rate. - Government undertakes to consult IMF staff in advance on terms and concessionality of proposed new debt. - Quantitative cumulative ceiling for new nonconcessional external loans: - US$800 million through December 31, 2013; - US$1,650 million through December 31, 2014; - US$3,843.4 million through December 31, 2015. - Ceiling applicable to debt-financing of projects in energy, infrastructure and transport sectors, and issuance of a Eurobond in 2015 for a maximum amount equivalent to U$1 billion. - Ceiling adjusted upward to reflect loan for rehabilitation and expansion of electric power grid by maximum amount equivalent to US$ 820 million, if terms are nonconcessional. - US dollar value of eligible loans subject to ceiling calculated using exchange rates at end-August 2013 in IFS database. - Amount of Eurobond deemed contracted = amount subscribed/purchased at end of subscription/purchase period as specified under final terms. - External payment arrears (PC): - External arrears = nonpayment of any interest or principal amounts on their due dates (taking into account contractual grace periods, if any). - PC applies to arrears under external debt of government and external debt guaranteed by government for which guarantee has been called. - Monitored on a continuous basis. - Amounts payable, including domestic payment arrears (IT and PC) — definitions: - “Amounts payable” (balances outstanding) include domestic arrears and floating debt; defined as expenditures assumed (prise en charge) by the public accountant but yet to be paid. - For program: obligations are (i) bills due and not paid to nonfinancial public and private companies; and (ii) domestic debt service (excluding the BCEAO). - Domestic payment arrears: balances outstanding to nonfinancial public and private companies and domestic debt service (excluding the BCEAO). Arrears to non financial and private companies = payment date exceeds 90 days; arrears on domestic debt service = payment date exceeds 30 days. - Floating debt: balances outstanding for which payment date does not exceed administrative regulation deadlines (90 days for nonfinancial public and private companies; 30 days for debt service to commercial banks, insurance companies, and other financial institutions). *Sources: Ivoirien authorities and IMF staff. Note: The terms in this table are defined in the TMU.* ### 21. The balances outstanding are broken down by payer and type, as well as by maturity and ### _cr15147 - 21. The balances outstanding are broken down by payer and type, as well as by maturity and ### Balances outstanding: breakdown and maturities - Balances outstanding are broken down by payer and type. - Maturities and length of overdue periods are categorized as: - For nonfinancial companies: < 90 days, 90–365 days, > 1 year. - For financial companies: <30 days, 30-365 days, > 1 year. ### Government commitments under the program - The government undertakes: - (i) to reduce the stock of amounts payable by at least CFAF 50 billion in 2015; and - (ii) to not accumulate new domestic arrears in 2015. ### Memorandum items #### A. Net Bank Claims on the Government - Definition: Net bank claims on the government are defined as the difference between government debts and government claims with the central bank and commercial banks (including the C2D deposits). - Coverage: The coverage of net bank claims on the government is that used by the BCEAO, and is the same as that shown in the net government position (NGP) (including the C2D deposits). #### B. External Financing (Definitions) - Within the framework of the program, the following definitions apply: - (i) Project grants: non-repayable money or goods intended for the financing of a certain project. - (ii) Program grants: non-repayable money or goods not intended for the financing of a specific project. - (iii) Project loans: repayable money or goods received from a donor to finance a specific project, on which interest is charged. - (iv) Program loans: repayable money or goods received from a donor and not intended for the financing a specific project, on which interest is charged. #### C. Program Monitoring and Data Reporting - Quarterly assessment reporting: - A quarterly assessment report on the monitoring of the quantitative performance criteria, indicative targets, and structural benchmarks will be produced by the authorities at the latest within 45 days of the end of each quarter. - Monthly and periodic reporting: - The government will report the information specified in Table 2 on a monthly basis, at the latest within 45 days of month-end or quarter-end, unless otherwise indicated. - Tables F.3.1, F.3.2, and F.3.3 are updated to take into account the expanded coverage of arrears. - The government will report final data provided by the BCEAO within 45 days of the end of the period in question. The information provided will include a complete, itemized listing of public sector liabilities and assets with: - (i) the BCEAO; - (ii) the National Investment Bank (Banque Nationale d’Investissement, or BNI); and - (iii) the banking sector (including the BNI). - Consultation and reporting on external debt: - The authorities will consult with the Fund staff on any proposed new external debt contracts or government guarantees on new external debt, including leases. - The authorities will inform the Fund staff, following signature, of any new external debt contracted or guaranteed by the government, including the terms of these contracts or guarantees. - Data on new external debt, the amount outstanding, and the accumulation and repayment of external payment arrears will be reported monthly within six weeks of the end of each month. *Source: _cr15147 - 21. The balances outstanding are broken down by payer and type, as well as by maturity and* ### 29. More generally, the authorities will report to the IMF staff any information needed for ### _cr15147 - 29. More generally, the authorities will report to the IMF staff any information needed for ### Reporting and monitoring obligation - "More generally, the authorities will report to the IMF staff any information needed for effective monitoring of the implementation of economic policies." ### Pro-Poor Spending (incl. Social Spending), 2009–15 (Table 1) — key line-items and totals (values preserved exactly as in source) - Agriculture and rural development: 49.239.135.241.468.272.181.781.988.6 - General administration: 8.59.27.07.710.016.321.428.033.9 - Agriculture promotion and development program: 10.610.810.812.018.715.115.917.823.4 - Training of supervisory staff: 8.48.310.38.413.515.718.416.921.5 - Water system works: 1.54.03.03.426.016.618.319.39.7 - Other investments in the rural area (FRAR, FIMR): 20.26.84.110.00.08.47.7 0.0 - Fishing and animal husbandry: 6.75.94.04.77.25.97.58.09.0 - General administration: 3.53.92.72.74.03.84.44.54.6 - Milk production and livestock farming: 2.31.81.21.52.90.91.71.72.0 - Fishing and aquaculture: 1.00.20.10.50.41.21.41.92.4 - Education: 533.1590.1529.2628.6651.2754.6756.3836.3960.9 - General administration: 19.624.924.723.619.819.519.520.625.2 - Pre-schooling and primary education: 336.7366.7301.1398.2379.2454.4449.2316.6403.8 - Literacy: 0.20.20.50.60.50.50.40.40.4 - Secondary education and vocational training: 83.083.874.280.374.883.787.7296.8306.9 - University and research: 93.7114.5117.0113.0140.0153.0156.1155.4178.1 - Emergency/Presidential program/Education: 0.00.011.712.836.943.543.546.546.5 - Health: 118.4113.6120.2138.0169.2205.1197.9267.4310.1 - General administration: 45.847.749.255.463.989.571.4123.0150.7 - Primary health system: 30.730.025.234.847.553.970.538.763.3 - Preventive healthcare (enlarged vaccination program): 1.91.40.40.82.32.61.62.91.5 - Disease-fighting programs: 1.71.51.11.44.01.21.724.85.6 - Infant/mother health and nutrition: 0.80.40.40.61.40.60.818.110.9 - HIV/Aids: 10.85.96.98.06.45.41.65.616.7 - Health centers and specialized programs: 26.626.625.725.131.833.932.334.241.4 - Emergency/Presidential program/Health: 0.00.011.312.012.018.018.020.020.0 - Water and De-contamination: 20.419.836.339.949.573.5118.482.183.3 - Access to drinking water and de-contamination: 4.96.010.210.710.825.469.937.038.7 - Environmental protection spending: 15.513.813.113.022.423.624.018.117.6 - Emergency/Presidential program/healthiness and de-contamination: 0.00.013.116.28.011.511.513.513.5 - Emergency/Presidential program/drinking water: 0.00.00.00.08.213.013.013.513.5 - Energy: 16.59.78.817.018.826.725.530.134.9 - Access to electricity: 16.59.78.99.010.813.712.516.621.4 - Emergency/Presidential program/Electricity: 0.00.00.08.08.013.013.013.513.5 - Roads and Art Works: 39.145.433.447.151.4101.780.2112.7118.7 - Road maintenance: 0.52.42.15.12.311.48.76.06.2 - Construction of art works: 3.02.51.17.54.022.25.623.320.4 - Other road projects: 35.640.622.223.534.152.249.965.567.0 - Emergency/Presidential program/maintenance and development: 0.00.08.011.011.016.016.018.025.0 - Social spending: 13.615.024.714.120.018.124.322.423.6 - General administration: 8.69.88.99.015.113.419.116.117.1 - Training for women: 0.60.70.50.70.70.50.60.90.8 - Orphanages, day nurseries, and social centers: 1.52.01.92.52.22.12.33.13.1 - Training of support staff: 1.71.91.61.31.61.81.92.02.1 - Indigents and victims of war or disaster: 1.20.511.80.70.50.40.40.40.5 - Decentralization (excl. education, health and agriculture): 35.132.029.032.131.731.834.560.056.1 - Reconstruction: 1.42.65.61.20.313.02.910.420.4 - Reconstruction and rehabilitation: 1.42.64.61.20.30.10.10.00.4 - Emergency/Presidential program: 0.00.01.00.00.012.92.910.420.0 - Other poverty-fighting spending: 9.611.916.215.913.06.77.910.510.8 - Promotion and insertion of youth: 8.48.913.713.47.65.15.48.18.2 - Support and follow-up of DSRP: 0.30.20.40.40.50.00.20.60.6 - Development of tourism and craftmanship: 0.92.82.02.14.91.62.31.82.0 - TOTAL: 843.0885.2842.7980.01,080.51,309.11,337.11,521.81716.4 (Source: Ivorien authorities. 1/ Supplementary Budget Law. 2012) ### Document transmittals and statistical reporting requirements (Table 2) — sectoral tables and periodicity - Real sector (R) - Table R.1: Cyclical Indicators (M) - Table R.2.1: Macroeconomic Framework (AN) - Table R.2.2: Supply-use accounts, current francs (AN) - Table R.2.3: GDP in francs (n-1): annual variation in volume (AN) - Table R.2.4: GDP deflators year (n-1) (AN) - Table R.2.5: Macroeconomic framework, underlying assumptions (AN) - Table R3: Price index (M) - Energy (selected): Tables R.4.1 through R.4.14 with periodicity (M) or (Q) as listed (e.g., Table R.4.1: Summary crude oil and gas production (M); Table R.4.12: Operating financial flows, SOGEPE (Q); Table R.4.13: Crude oil: Shipment report (Q); Table R.4.14: Petroleum revenue: Structure of maximum sales prices (M)) - Coffee/cocoa (selected): Table R.5.1–R.5.4 (Q) - Balance of Payments sector (B): Table B.1.1 (AN), B.1.2 (M), B.1.3 (M), B2.1 (AN), B.2.1.a (Q), B.2.1.b (Q), B.2.2.a (Q), B.2.2.b (Q), Table B.3 (AN) - Monetary sector (M): Tables M.1–M.6 (M) - Fiscal sector (F) — comprehensive monthly/quarterly/annual reporting requirements including: - Table F.1: Table of government financial operations (TOFE) (M) - Table F.2: Estimated government tax revenue (M) - Domestic arrears: Tables F.3.1–F.3.4 (M) - Domestic and foreign debt: Tables F.4.1–F.5.4 (M/Q) - Post-crisis expenditures: Table F.6 (M) - Treasury advances: Tables F.7.1–F.7.2 (M) - Investment expenditures: Table F.8 (M) - Social/pro-poor expenditures: Tables F.9.1–F.9.6 (M/Q) - Other operating expenses and revenue tables: F.10–F.13 (M) - VAT credits: Table F.14.1 (M) - Financing: Tables F.15.1–F.15.2 (M) - Wage bill: Tables F.16.1–F.16.4 (Q/AN) - Special accounts: Tables F.17.1–F.18 (AN) - Cash flow plan: Tables F.20.1–F.20.3 (AN/M) ### Relations with the Fund — key financial and institutional figures (as of March 31, 2015) - Membership: Joined: March 11, 1963 Article VIII - Quota (SDR Million and %Quota): Quota 325.20 100.00 - Fund holdings of currency (Exchange Rate): 324.17 99.68 - Reserve Tranche Position: 1.05 0.32 - SDR Department: Net cumulative allocation 310.90 100.00; Holdings 272.78 87.73 - Outstanding Purchases and Loans (SDR Million; %Quota): - RCF loans 81.30 25.00 - ECF Arrangements 637.72 196.10 - Latest Financial Arrangements (selected): - ECF Nov 04, 2011 – Dec 31, 2015 Amount Approved (SDR Million) 520.32 Amount Drawn (SDR Million) 422.76 - ECF Mar 27, 2009 – June 23, 2011 Amount Approved 373.98 Amount Drawn 230.89 - ECF Mar 29, 2002 – Mar 28, 2005 Amount Approved 292.68 Amount Drawn 58.54 - Projected Payments to Fund (SDR Million; based on existing use of resources and present holdings of SDRs): - Principal 2015 39.02 2016 46.18 2017 85.20 2018 109.59 2019 113.17 - Charges/Interest 2015 0.02 2016 0.02 2017 0.02 2018 0.02 2019 0.99 - Total 2015 39.04 2016 46.20 2017 85.22 2018 109.61 2019 114.16 - HIPC Initiative: Decision point date Mar 1998; Enhanced framework Decision point Apr 2009; Assistance committed by all creditors (US$ Million) 345.00 and 3,109.58 respectively; IMF assistance (US$ million) 22.50 and 38.66 (SDR equivalent in millions) 16.70 and 25.85; Completion point date -- June 2012 - Safeguards assessment: BCEAO assessment completed December 13, 2013; findings include strong control environment, enhanced governance, audit committee established, commitment to IFRS implementation by end-2014; recommendation to select a second experienced audit firm — BCEAO has selected a second audit firm. ### Technical assistance and IMF work program (selected highlights by year) - 2011: Multitopic (July) — strengthen TOFE compilation and implement WAEMU common GFS guideline; Debt management (July); Customs administration (August); FSAP follow-up (August); Public expenditure management (October); National accounts (December) — assessment of quarterly national accounts. - 2012: Government financial statistics (Jan/Feb, Nov/Dec); Tax administration workshops; Customs workshop; Public wage bill management (December). - 2013: Public expenditure management — budgeting strategy; Public Debt Management workshops; Customs/tax administration workshops; National accounts — quarterly national accounts; Strategy and Roadmap to Program Budgeting; Cash management — Treasury Single Account; Migration to GFSM 2001. - 2014: Public Financial Management (January) — Budget execution and spending procedures; Customs Administration - AFRITAC (March); Cash management (April); National Accounts-AFRITAC (April) — Quarterly GDP; Tax administration– AFRITAC (May) — VAT management; Treasury Single Account implementation support; Budget Management Information System modernization; Accounting and financial reporting improvements. - 2015: Revenue Administration diagnostics and IT systems for VAT administration; Public Financial Management — Budget preparation and credibility; Tax Policy — Auditing of large taxpayers. - Resident Representative: First posted in Abidjan in 1984; interruptions in 2005–06 and 2010–11; continuously assigned since May 2011. ### Joint Bank-Fund work program, 2015–16 (selected items and timings) - World Bank: CI- Country Partnership Framework (CPF) — July 16, 2015; Third Poverty Reduction Support Credit — February to July 2015; CI- Public Investments and Service Delivery — May 30, 2016; CI-Productive Social Safety Net — May 28, 2015; CI-Emergency Basic Education Support Project — September 30, 2015; numerous sectoral operations and ESW with various expected delivery dates in 2015–2016. - IMF: 8th ECF review (September 2015); Article IV Consultation (January 2016) - Mutual requests: - Fund requests to Bank: Periodic updates on budget implications of reforms in the civil service, coffee/cocoa sector, electricity sector, financial sector, as well as an infrastructure master plan (Ongoing) - Bank requests to Fund: Regular updates on macro-economic and fiscal projections (Ongoing) ### African Development Bank (AfDB) Group — operations and portfolio summary (selected) - Since 1971: AfDB approved 71 operations for Côte d'Ivoire; 41 fully completed, 14 cancelled, 9 ongoing (3 newly approved). - Net commitment: UA 1,399 million (CFA F 1,053 billion) - Sectoral distribution by importance: multi-sector (24%), social sector (20,68%), rural development and agriculture (20,40%), transport (17,32%), energy and telecommunications (13,67%), water/sanitation (3,8%), finance (0,2%). - Financing window: more than 70% from ADB window; 92,36% directed to public sector. - Post-2011 interventions: 2011–12 Country Brief and Emergency Programme to Restore Basic Social and Administrative Services (PURSSAB); Post-Crisis Multi-Sector Institutional Support Project (PAIMSC); support for rehabilitation of health and educational establishments and income-generating activities in former CNW zones. - Status of Bank Active Portfolio as of March 2015 (example project): - Gourou Basin Integrated Management Project (Sanitation of Indenié junction and the Lagoon): UA 23 — grant approved November 24, 2010, put in place June 2011. *Prepared By African Department “In Consultation with other Departments” — informational annex content as provided.* ### 5.5 The main purpose of this program, which will ### 5.5 The main purpose of this program, which will ### Program purpose and scope - Main purpose: contribute in the national budget to restoring basic social and administrative services, social cohesion and reconciliation as stated in the Government’s request. - Program completion: end of June 2015. - Program addressed urgent needs through restoration of: - basic health, educational and social welfare services, - water and sanitation networks, - public administration services, - dialogue, social cohesion and reconciliation mechanism. ### Specific projects and objectives - Agricultural infrastructure support project in Indéné-Djuablin Region (PAIA-ID) - 21.6 - Objective: contribute to improving food security and reducing poverty in rural areas; increase, on a sustainable basis, the production and productivity of major crops; improve marketing conditions. - Youth Employability and Insertion Support Programme - 18,8 - Objective: support promising employment and vocational training to create direct jobs for women and youths; assist changing the profile of future labour through reforms (gradual shift to steer the educational system to respond to economic demand and act on rapidly growing labour flows). - The Social Inclusion and Cohesion Enhancement Support Programme (budget support) - 30 - Approved: June 2014. - Objectives: restore social cohesion, improve social inclusion, address social and psychological damage caused by past conflict, nip conflicts in the bud to guarantee greater political stability and more equitable economic growth. - Main expected outputs: - (i) the socio-economic reintegration of ex-combatants; - (ii) support for the resolution of inter-community conflicts and care of victims. ### Status of Bank Active Portfolio (as of March 2015) — selected operations and amounts (in UA million) - Strengthening systems to protect economies against health shocks (regional operation, approved in October 2014) - 6 - Purpose: response to emergency created by the Ebola epidemic and longer term requisites for economic resilience and prevention of similar public health shocks. - Côte d’Ivoire, Liberia, Sierra Leone and Guinea (CLSG) Interconnection Project – Multinational - 33,00 - Purpose: support energy sector via interconnecting power grids of Côte d’Ivoire with other Mano River Union member countries. - Road Development and transport Facilitation Programme within the Mano River Union (MRU) countries (Côte d’Ivoire, Guinea and Liberia), December 2014 - 97 - Objective: boost post-conflict economic recovery by improving road infrastructure and promoting intra-community trade; reduce transport costs; facilitate free movement of persons and goods; improve living conditions of programme area communities. - Fight back Programme against EBOLA - 10 - Objectives: bring the Ebola epidemic to an end; strengthen foundations for effective control of unusual public health events; pave the way for sustainable improvement of systems and capacities for post crisis resilience. - Project construction of bridge toll Henri Konan BEDIE (private sector, PPP BOT concession 30 years) - 50 - Purpose: build toll bridge over the Ebrié Lagoon linking South and North shores of Abidjan. - Azito power expansion project - 26 - Purpose: convert existing simple-cycle power plant of 2 x 144 MW gas-fired turbines to combined-cycle, increasing capacity to approximately 430 MW. - Ciprel power expansion project - 44 - Purpose: expand to combined cycle turbine facility in two phases: phase A gas turbine (111MW), phase B combined cycle turbine additional 111MW; increase capacity by 222MW. - Microcredit Côte d’Ivoire (equity participation and technical assistance) - 1.5 - Notes: equity participation part signed on June 2013; technical assistance part to be signed on November 2013. ### Strategy for AfDB re-engagement - Timeframe referenced: period 2011–12; Country Strategy Paper approved beginning of December 2013. - Two pillars: - (i) Strengthening Governance and Accountability — create environment to foster socio-economic inclusion and address demands for improved governance and basic service delivery. - (ii) Infrastructure Development in support of Economic Recovery — promote optimal use of natural resources through development of high quality infrastructure in agriculture, transport and energy to bolster economic recovery. ### Indicative Work Program for 2015 and 2016 (Description — Amount in UA million — Year) - Côte d’Ivoire-Mali regional road Project (under preparation) — 73 — 2015 - SME and SMI Support Project — 10 — 2015 - Agro-industrial Infrastructure Support Project in the Centre Region — 30 — 2016 - Regional African Trade Insurance — 10 — 2015 - Abidjan Urban roadway development Project — 140 — 2015 - Road project Odiénné -Mali Border — 80 — 2016 - Road projet Tieningboue-Mankono — 45 — 2016 - San Pedro Regional Port Extension Project (private sector) — 50 — 2016 ### Statistical issues (As of May 2015) — assessment and data adequacy - General assessment: Data provision has some shortcomings, but is broadly adequate for surveillance. Weaknesses in national accounts, balance of payments, public finance statistics, and reconciliation of fiscal and monetary data. - National accounts: - Comprehensive national accounts for 1996 onwards compiled using 1993 SNA methodologies, base year 1996. - Authorities drafting plan to implement 2014 as new base year and update implicit deflators. - National accounts up to 2012 (final) and 2103 (provisional) are available. Fund staff has made observations on weaknesses yet to be addressed. - Ongoing work on quarterly national accounts with AFRITAC West support; first data projected to be available by end 2015. - Price statistics: - Harmonized CPI adopted by all WAEMU members; new base year (2008) adopted in 2010. - Current CPI covers main city (Abidjan); will be extended to other urban areas with support from WAEMU Commission and AFRISTAT. - Labor market statistics: No such statistics are published regularly. - Government finance statistics: - Annual data on budgetary central government compiled. - Monthly or quarterly fiscal data not provided for publication but made available to IMF African Department; metadata lacking. - Authorities transposing 2009 WAEMU TOFE Directive based on GFSM 2001; laws and decrees approved by Council of Ministers and await Parliamentary approval. - Assistance from AFRITAC to use Treasury Trial Balance for reporting budgetary central government operations and progressively implement GFSM 2001. - Parallel TOFE based on trial balance being compiled; work needed to expand TOFE coverage to all subsectors of general government. - Monetary sector statistics: - Prepared by national agency of the BCEAO and released by BCEAO headquarters. - Shortcomings: inconsistencies in source data and lack of proper sectorization to fully adhere to Monetary and Financial Statistics Manual. - STA missions (2011, 2013, 2014) to BCEAO headquarters made recommendations and assisted in developing SRFs for central bank accounts and initiated work on SRF for other depository corporations. - Financial sector surveillance: BCEAO accepted STA’s invitation to begin regular reporting of member countries’ FSIs for dissemination on the IMF website. - External sector statistics: - National agency of the BCEAO in Abidjan compiles and disseminates annual balance of payments and international investment position. - BCEAO headquarters delineates methodology and calculates international reserves for WAEMU countries. - Customs computer system allows satisfactory monitoring of trade data, though inconsistencies with BP6 and shortcomings in coverage of services and transfers. - Weaknesses in coverage of foreign assets of private nonbanking sector, reporting of private capital flows (especially FDI), and insufficient information on private debt stocks and debt service flows. - Latest ESS data available relate to 2010. ### Data Standards and Reporting - Participation: Côte d’Ivoire participates in the General Data Dissemination System (GDDS) since May 2000 and has posted metadata on the Data Standards Bulletin Board. - No data ROSC is available. - Reporting to STA: Côte d’Ivoire regularly reports data to STA; latest balance of payments reported is for the year 2010. ### Table of Common Indicators Required for Surveillance (As of May 2015) — selected entries - Exchange Rates — Date of Latest Observation: Current — Date Received: Current — Frequency of Data: M — Frequency of Reporting: M — Frequency of Publication: M - International Reserve Assets and Reserve Liabilities of the Monetary Authorities — Date of Latest Observation: 02/15 4/15 — Frequency of Data: M — Frequency of Reporting: M — Frequency of Publication: M - Reserve/Base Money — 02/15 4/15 — M M M - Broad Money — 02/15 4/15 — M M M - Central Bank Balance Sheet — 02/15 4/15 — M M M - Consolidated Balance Sheet of the Banking System — 02/15 4/15 — M M M - Interest Rates — 02/15 4/15 — I M M - Consumer Price Index — 03/15 4/15 — M M M - Revenue, Expenditure, Balance and Composition of Financing – General Government — 02/15 4/15 — M M M - Stocks of Central Government and Central Government-Guaranteed Debt — 02/15 4/15 — M M M - External Current Account Balance — 12/12 3/15 — M M M - Exports and Imports of Goods and Services — 12/12 3/15 — M M M - GDP/GNP — 2014 3/15 A A A - Gross External Debt — 02/15 4/15 — M M M *Source: IMF staff summary (as provided in the content unit).* --- _Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2015/_cr15147.pdf_