Ivory Coast Increases Budget on Higher Cocoa, Gas, Port Revenues

Posted by Michelle Howard July 9, 2014

Ivory Coast has increased its 2014 budget by nearly 4 percent on expectations of higher earnings from cocoa, natural gas and the country's ports, a government spokesman announced on Wednesday.

Ivory Coast, the world's top cocoa grower and French-speaking West Africa's largest economy, has undergone a rapid economic turnaround since the end of a decade of political turmoil in 2011. Its economy grew around 9 percent last year.

"The cabinet adopted a finance bill revision that brings the 2014 state budget to 4,407 billion CFA francs ($9.16 billion), up from 4,248 billion CFA francs initially," government spokesman Bruno Kone said following a cabinet meeting.

Ivory Coast announced a surprise first-quarter budget surplus in May after state revenues, resulting largely from improved tax collection, beat expectations by around 31 percent.

Kone said that the new budget would see investment spending increase from 1,258 billion CFA francs to 1,306 billion CFA francs for the year.

"These are good signals that confirm that our economy is doing well and that our current GDP growth rate of 9.1 percent will be maintained," he said.

Credit ratings agency Moody's assigned Ivory Coast a first-time rating of B1 with a positive outlook on Tuesday. The agency gave the same rating, which ranks the country four notches below investment-grade, to a planned $500 million Eurobond.

The new bond, expected to be issued this month, will mark Ivory Coast's first venture onto the international capital markets since it defaulted on its previous Eurobond during a brief post-election civil war three years ago.

The government resumed coupon payments on the defaulted $2.5 billion Eurobond after securing $4 billion in debt relief in June 2012 under an IMF-World Bank scheme. It has since emerged as one of non-oil producing Africa's best-performing credits.

($1 = 480.9100 West African CFA Francs)