Cote d'Ivoire: Economic Crunch Bites as Crisis persists
By Eric Sande
ABIDJAN---The economy of Ivory Coast has been plunged into chaos with the state coffers running dry by day. The gradual plunge into an abysmal economic crisis cropped up after the two leaders , Laurent Gbagbo and Alassane Ouattara, both declared presidents of the Ivory Coast after the November 2010 Presidential election.
Two months on, the two presidents do keep an eye open to see if the new African Union mediation efforts will come to restore sanity while they engage in nurturing an institutional-conflict-by-proxy.
Gbagbo government spokesman, Ahoua Don Mello read in a statement Sunday on national television that, “The financial situation is getting tough” for banks in the Ivory Coast, and there is a financial crisis in Abidjan now, with trade slowing down.
The United States ambassador in the Ivory Coast, Phillip Carter III, is reported as saying that the army would eventually stop backing Gbagbo when the state coffers run dry. Early February, Mr. Carter had suggested that the window for Gbagbo to leave honourably, peacefully, with amnesty, was closing.
Mello responded by accusing the US diplomat Carter III, of “grave and unacceptable interference" in the internal affairs of his country as well as "blatant bias" for Alassane Ouattara.
Gbagbo’s refusal to cede power, has forced the international financial pressure supporting his opponent, Alassane Ouattara, to finally make its presence felt after his troops seized the regional stock exchange.
"Money is drying out," said business risk analyst Lydie Boka, manager of the France-based firm StrategieCo. "We live in a globalized world, and Gbagbo is trapped."
Of thirteen banks visited in Abidjan Wednesday, eleven were open for business, though only four had working banking machines, according to an Associated Press tally.
"Gbagbo has been trying to use the BCEAO offices in Abidjan as a central bank," Boka said, "but international banks cannot deal with this ad-hoc central bank because of the sanctions, so they're simply shutting down."
The Central Bank of West African States, known by its French acronym BCEAO, endorsed Ouattara's victory in November's election nearly two months ago but didn't succeed in cutting Gbagbo off from state coffers until it fired its president, a close Gbagbo ally accused of funneling money to his friend, in January.
Computer printouts posted at many bank branches informed clients of reduced banking hours. At one downtown branch of the SIB bank, the crowd grew angry after security stopped allowing people in a few minutes before the 3pm closing time.
The country’s economic situation is rapidly deteriorating. Inflation is high. Shortage of drugs in pharmacies and power cuts are becoming the order of the day. ATM or Cash Machines are increasingly empty. The consequences of the conflict between Gbagbo and the Bank of Central African States (BCEAO) are being felt. And due to the sanctions imposed in January by the European Union, the national oil and gas company (PETROCI), which produces 80,000 barrels per day, could close its refineries in a few months. PETROCI may no longer be able to assure domestic gas supply in the coming days.