The financial war in Ivory Coast: Five key questions answered
The real battle for the world's No. 1 cocoa producer isn't happening on the streets of the commercial capital, Abidjan. It's unfolding in bank corridors.
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But that industry has been nearly milked dry: Up to 40 percent of the export price of Ivorian cocoa consists of the government's take, both formally and informally. In coming chaotic months, as soldiers, ruffians, and bureaucrats skim more and more revenue off cocoa farmers, truckers, and traders, expect to see more cocoa smuggled across the Ghanaian border, where farmers earn nearly twice the $2 a kilogram they fetch in Ivory Coast.Skip to next paragraph
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But Gbagbo's government need not live on chocolate alone: The IMF suspects that state revenue from Ivory Coast's oil reserves may actually exceed the $1 billion a year it fetches from the cocoa harvest. How he'll manage, keep, invest, and pay out that revenue could help determine how long he can hold on to the Ivorian throne.
5.) Is the Idea of a new Ivorian currency for real?
In the last-minute drive to keep their government fed, Gbagbo's closest advisers are rushing to build the apparatus of a self-sufficient state – something intrinsically different from the Ivory Coast envisioned by Francophiles that founded it.
The notion of tossing up a strident, self-isolated Ivory Coast that more closely resembles Zimbabwe (where Gbagbo has sought advice) than, say, Senegal, may seem like a wide-eyed, midnight hour-idea meant to stave off an impending regime collapse. But it's closer to the entire raison d'être of Gbagbo's movement.
"They have an obsession with autarky," meaning economic self-dependence, International Crisis Group analyst Rinaldo Depagne told The New York Times. And it's an obsession that's had a long time coming.
Much is mind-boggling about the Ivorian conflict, but this much is clear: The country was founded with limited economic independence from France, from which it benefited from 40 years of stability, impressive growth, and French aid, while neighboring Ghana, now a rising world market, suffered the madness of military coups and banknotes that dove in value like pogs.
Today, not Ivory Coast, but rather Ghana leads West Africa, and the French ties seem more a disadvantage than a safety precaution. Growth in the eight countries that use the West African CFA franc, which is tied to the euro, has lagged behind the sub-Saharan African average.
The Gbagbo era has marked a perhaps inevitable backlash to Ivory Coast's French-friendly policy, and the latest expression of that resentment is the Gbagbo's Currency of the Ivoirian Resistance. It's the bills that Gbagbo's team has proposed printing as a way to pay civil servants and soldiers. As a currency, analysts say the MIR would almost surely be a disaster. But the irony is that, whenever the ruckus dies down, it might not be such a terrible idea.
"A large chunk of Africa is tied to the least adaptive zone in the world," African Development Bank Chief Economist Mthuli Ncube told Bloomberg News in June. "Surely, that's a disadvantage."
If there's hope for whatever comes out of this political crisis, it's that the conflict – messy and destructive as it has been – may offer this nation a fresh chance to reclaim its place as an economic leader in West Africa.