Index trend
Previous quarterly editions
Expropriation risk: 54 49 49 48 ▼ Political violence risk:51 49 48 48 ►Terrorism risk:44 43 41 41 ▼Exchange transfer and trade sanction risk: 55 55 55 54 ►Sovereign default risk:73 73 65 65 ►
Overall Risk Temperature: 54 (Medium -1) TREND ►
Special topic: Gray zone aggression
Degree to which the country relies on outbound gray zone action to achieve its strategic objectives1 = Not at all5 = Gray zone action is a core tactic
1
Impact of inbound gray zone attacks on the country1 = Negligible impact5 = Significant impact on economic growth and/or political stability
2
Cote d’Ivoire is not known to have mounted or been the victim of gray zone attacks according to the open-source data available. Cote d’Ivoire’s relationships with its regional (excluding Burkina Faso) and international neighbors are cordial. Abidjan maintains close ties with former colonial power France and actively courts foreign investment from the European Union, the U.S. and China.
The country maintains diplomatic relations with Russia, which has increased its presence in Ivorian civil society in recent months and has an anti-Western agenda. The West African country maintains a small military force for defensive purposes and is not seen as a local or regional military threat.
The potential for gray zone activities in cyberspace exists, as evidenced by the rising rate of cybercrime in the country and government attempts to counter it. The West African country is reputed to have one of the highest rates of cybercrime on the continent — despite having a comparatively low (though rapidly rising) level of internet penetration of round 45.4%. The government launched its 2021 – 2025 National Cyber Security Strategy at the beginning of the decade, including action to prevent cyberattacks on government information systems and critical infrastructure. Nevertheless, the disclosure that Foxtrot International, a local subsidiary of the French group Bouygues, was the victim of a $200,000 bank transfer fraud in September 2023 highlights continued vulnerabilities.
TREND ▼
The risk of arbitrary expropriation or uncompensated confiscation of property or assets faced by foreign investors in Cote d’Ivoire remains negligible. The sole exception to this general rule occurs in the cocoa sector where Cote d’Ivoire and neighboring Ghana — respectively the largest and second-largest growers of cocoa in the world — have announced their intention to transform themselves from exporters of primary commodities to major players in the value-added sector.
The government intervened in the market in April to increase prices to 1,500 CFA francs ($2.48) per kilogram — a record high — following the surge in cocoa prices on the New York Stock Exchange earlier in the year to $5,874 per tonne. While the larger cocoa buyers such as Mars, Ferrero Roche and Cargill — whose capitalization exceeds the GDP of the two West African cocoa growers — are likely to be unaffected by the move, many smaller players are likely to find themselves squeezed out of the sector altogether.
Cote d’Ivoire continues to be a regional magnet for foreign direct investment, which is fundamental to the country’s short- to medium-term growth outlook, and the government is highly unlikely to embark on any course of action such as arbitrary expropriation, which would jeopardize its investor-friendly status.
At 82 years of age, President Alassane Ouattara is expected to step down when his third term in office expires in 2025, although he has yet to announce his intentions. Assuming that he does step down, a new leader will have to be appointed or selected from within the ruling Rally of the Republicans, who will face the main opposition PDCI Democratic Party, now led by former Credit Suisse CEO Tidjane Thaim in the 2025 ballot.
Despite the violence that accompanied the 2020 presidential elections when Ouattara stood for an unconstitutional third term, the country’s social and political cohesion appears to have improved considerably over the past five years. The 2025 transition of power will be a key test of its ability to maintain that stability.
Large-scale spending on infrastructure, roads, tower blocks, housing, power plants and bridges — including the recently opened Alassane Ouattara bridge in Abidjan — have made the economic capital barely recognizable from a decade ago. GDP has roughly doubled over the past decade or so, although 40% of the population still live in poverty.
The risk of terrorist attacks — particularly from neighboring Burkina Faso, Mali and Niger — continues to pose a threat to the stability of Cote d’Ivoire and other coastal states in the Gulf of Guinea region, although this is easily overstated. Despite major incidents in 2016 and 2020, Al-Qaeda and Islamic State have singularly failed to gain a foothold in the country, which remains a strong ally of France and home to 900 French troops.
The series of military coups in Mali, Burkina Faso and Niger in recent years, and particularly the inflow of military assistance to all three from Russia, has certainly heightened tensions in the region, amid reports that the U.S. is moving aircraft and commandos into the West African region to help curtail the spillover of Al-Qaeda and Islamic State militants into the region, after being expelled from their stronghold in Niger earlier this year.
TREND ►
Cote d’Ivoire recorded a marginal drop in inflation to 4% in July, down from 4.1% in June, although there were significant spikes in inflation in key sectors — food at 5%, housing 7.9% and transport 3.5%. Nevertheless, inflation does now appear to have peaked.
Economic growth is forecast to reach 6.5% of GDP in 2024, up from 6.3% in 2023, more or less in line with the average 7% annual growth over much of the past decade. Under Ouattara’s leadership, Cote d’Ivoire’s GDP has increased from $43 billion in 2013 to $70 billion at present, making the country’s economy the economic powerhouse of the West African region.
The government this year unveiled a $20 billion plan to further help drive economic growth, which aims to increase installed generation capacity to 3.5 gigawatts by 2025 and 8.6 gigawatts by 2040. The country is expecting a twofold increase in oil output by 2027, boosted by recent oil and gas discoveries by Italy’s Eni in the offshore Baleine and Calao fields.
Ouattara told Parliament earlier this year that more than $15 billion is to be invested in the country’s hydrocarbons sector, which should see output grow to 200,00 barrels per day from 60,000 at present.
Cote d’Ivoire earlier this year overtook South Africa to become the highest-rated sovereign in sub-Saharan Africa by several credit rating agencies. This was due to the country’s improved debt profile, making the risk of default highly unlikely. The country’s debt-to-GDP ratio stands at 58%, up from 38% in 2019, although this is still low for an African sovereign and is expected to decline to around 50.8% by 2027.
Both the International Monetary Fund and the World Bank insist that the country’s debt burden is sustainable. Debt-fueled growth, however, is not without its critics, domestic and foreign, who warn that roughly half the annual budget is now financed by foreign loans.
Cote d’Ivoire remains popular with foreign investors and in January saw its $2.6 billion Eurobond issue oversubscribed, thereby ending sub-Saharan Africa’s near two-year lockout from international capital markets. Moreover, the country’s 2023 budget deficit of 5% of GDP is expected to fall to 3% over the short to medium term.
