News / Africa

Economic Sanctions Hurting Ivory Coast Economy

A woman sells food next to an open sewer in the Adjame neighborhood of Abidjan, Ivory Coast, January 28, 2011
A woman sells food next to an open sewer in the Adjame neighborhood of Abidjan, Ivory Coast, January 28, 2011

The political crisis between rival governments in Ivory Coast is beginning to effect its economy, as sanctions against the incumbent president lead to fuel and currency shortages.

The United States, the European Union and West Africa's regional economic alliance have all imposed sanctions against the government of incumbent President Laurent Gbagbo, because he is refusing to give up power to the United-Nations-certified winner of the vote, former Prime Minister Alassane Ouattara.

People in the commercial capital, Abidjan, say they are beginning to feel the impact of those sanctions. Mechanic Lamine Sylla says people do not have money to fix their vehicles.

Lamine says there have been many problems. If you work for the government, your money has been trapped.  You can no longer get paid. He says he has done five months of work on government vehicles and there is no money to pay him.

As the world's largest cocoa producer, Ivory Coast was once the economic giant of West Africa. But a brief civil war, years of division, and the political crisis that has followed November's election has brought power cuts, piles of uncollected trash and shortages of medicine.

Market Trader Fidel Sacre says it is something Ivorians have never seen.

Sacre says the impact of the crisis on the business sector is catastrophic.  He says it is the first time anyone in Ivory Coast has ever seen this in their own country.

With the Gbagbo government cutoff from the region's central bank, many cash machines in Abidjan are running out of money. Banks are limiting withdrawals and are having trouble clearing checks because connections to the regional banking system were severed when the Gbagbo government seized control of the central bank's local office.

That has been restricting the amount of cash in circulation, cutting into business for mobile phone seller Kadidiatou Sanoussi.

Before the crisis, Sanoussi sold five or ten mobile phones a day. But now things are quite difficult. Just to sell three mobile phones a day, Sanoussi says traders really need to hustle and bargain with customers to convince them to buy.

Ivory Coast's state-run oil firm says sanctions may eventually shut its refinery, reducing supplies of petroleum. Dealer Desire Allah says there is already a shortage of cooking gas.

With regular customers, Allah says business can hold up for two more weeks.  But there are other dealers who have nothing left and are struggling to find gas canisters.  Allah says the people can hold on for another week, but after that it will be very difficult as everyone switches to charcoal.

Gbagbo and Ouattara are both blaming each other for the economic hardships of this political crisis. Five heads of state from the African Union meet this week to discuss how best to resolve the dispute. West African leaders say they will await the outcome of that mediation but reserve the right to use military force to remove Gbagbo.

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