Identifier
Created
Classification
Origin
09ABIDJAN35
2009-01-15 14:01:00
UNCLASSIFIED
Embassy Abidjan
Cable title:  

FINANCE MINISTER DOCUMENTS PROGRESS MADE TO MEET

Tags:  EFIN EAID PGOV PREL ECON IV 
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P 151401Z JAN 09
FM AMEMBASSY ABIDJAN
TO SECSTATE WASHDC PRIORITY 4854
DEPT OF TREASURY WASHDC PRIORITY
INFO ECOWAS COLLECTIVE
UNCLAS ABIDJAN 000035 


STATE FOR EEB/OMA, TREASURY FOR DPETERS

E.O. 12958: N/A
TAGS: EFIN EAID PGOV PREL ECON IV
SUBJECT: FINANCE MINISTER DOCUMENTS PROGRESS MADE TO MEET
HIPC CRITERIA

REF: A) 2008 ABIDJAN 813
UNCLAS ABIDJAN 000035


STATE FOR EEB/OMA, TREASURY FOR DPETERS

E.O. 12958: N/A
TAGS: EFIN EAID PGOV PREL ECON IV
SUBJECT: FINANCE MINISTER DOCUMENTS PROGRESS MADE TO MEET
HIPC CRITERIA

REF: A) 2008 ABIDJAN 813

1.(U) Embassy has received a letter dated January 6, 2009
from Cote d'Ivoire's Minister of Economy and Finance, Charles
DIBY Koffi, which outlines steps the country has taken to
comply with conditions/criteria for the HIPC decision point.
The letter, addressed to the Ambassador, covers concerns
raised by the IMF/World Bank mission that visited Abidjan in
October 2008, namely ex-budgetary expenditures, clearance of
arrears to the African Development Bank (AfDB) and payment
(in oil) for public works projects in the adminstrative
capitol of Yamoussoukro. The letter stressed Cote d'Ivoire's
commitment to satisfying the concerns of the Bretton Woods
institutions and solicits the support of the USG for debt
relief. An informal Embassy translation of the original
French text follows in paragraph 2. Post is also transmitting
the text in French to AF/W.


2. (U) Begin translation of text.

To: Her Excellency the Ambassador of the United States in
Cote d'Ivoire, Abidjan.

Subject: Information on the Economic and Financial Program
of Cote d'Ivoire with the Partners for Development and
Request for Support

Excellency,

The preliminary document of the enhanced initiative in favor
of Heavily Indebted Poor Countries (HIPC) for Cote d'Ivoire
has just been approved by the Boards of the International
Monetary Fund and World Bank, respectively on 12 and 16
December 2008.

This decision follows the efforts undertaken by the
Government since August 2007, in the framework of the
implementation of the Emergency Post-Conflict Assistance
(EPCA) Program. It notably concerns:
- the normalization of budget management;
- communication to the Council of Ministers, and quarterly
publication of the status of budget implementation, physical
and financial flows of the energy sector and data
(statistics) relating to the collection and use of levies on
the coffee/cocoa sector;
- gradual reduction in levies as special levies on coffee and
cocoa;
- adherence to the Extractive Industries Transparency (EIT)
Initiative;
- evalution of the system used to handle public finances and
preparation of a reform plan, taking into account all the

components.

In addition, despite the state's financial difficulties,
efforts have been made for the clearance of arrears to the
World Bank (225 billion CFA francs) and to start the
clearance of those to the African Development Bank, amounting
to 50 billion CFA francs.

The adoption of the preliminary document of the HIPC
Initiative gives Cote d'Ivoire the possibility to reach the
completion point of this initiative and conclude a medium
term program supported by a Poverty Reduction and Growth
Facility (PRGF),before the end of the first quarter of 2009.

Considering what is at stake in this program, that is to say,
the reduction in foreign debt, resumption of sustained growth
and, therefore, viability of the fight against poverty, the
government has made it a priority to implement all requests
and recommendations relating to them. This is why a diligent
response has been given to the observations and reservations
expressed at the conclusion of the October 2008 joint mission
of the International Monetary Fund, the World Bank, and the
African Development Bank.

Those observations concerned budget overrun linked to major
investment works by the state, the government's capacity to
respect the quantitative indicators of the program, notably
the primary basic balance and the level of social
expenditures, and concerns for the clearance of arrears to
the African Development Bank.

The measures taken by the Government to address these
concerns come down to the following:

CONCERNING MAJOR PUBLIC WORKS INVESTMENTS BY THE STATE:

- ordinance no. 2008-310 of November 3, 2008, amending the
management of the national budget in 2008, permitted the
integration of higher than planned levels of expenditures
linked to public works invesmtments by the State;

- a new procedure governing the budgeting for financing of,
and execution of public work operations including the
monitoring and evaluation of such operations, has been
defined by the Prime Minister through Instruction no.
001/PM/CAB of November 13, 2008 and Order no. 039/PM/CAB
which creates the Inter-ministerial Committee for operations
monitoring relating to major public works investments;

- a framework of contradictory evaluation of the works
carried out, including the National Consulting Firm for
Technical Studies and Development (BNETD),the General
Inspectorate of Finance and the operator, has been put in
place.

CONCERNING THE QUANTITATIVE INDICATORS OF THE PROGRAM, the
measures taken at the budget execution level guarantee
observation of the minimum social expenditures level and the
attainment of the planned primary basic balance, that is to
say, 0.8 percent of GDP. Actually, state expenditures were
frozen onNovember 24, 2008. Thus the expenditures estimated
at the end of November 2008 are almost definitive.

CONCERNING ARREARS CLEARANCE TO THE AFRICAN DEVELOPMENT BANK,
provisions are under way to finalize a financing operation
that will permit the mobilization of resources needed to pay
off the balance beyond the 50 billion (CFA) already paid by
the Government.

In addition, discussions continue about how to finalize
negotiations so as to permit the presentation of Cote
d'Ivoire's dossier to the Boards of the International
Monetary Fund and World Bank before the end of March 2009.

In this framework, the understanding and the support of all
the bilateral partners are necessary, so as to enable Cote
d'Ivoire to complete the program, and thus, secure the
conditions for sustainable peace.

And, I would like to request, on behalf of the Ivorian
Government, the support of the American authorities, notably
within the Bretton Woods institutions, with a view to full
resumption of cooperation with the international financial
community.

Reiterating my thanks to you for your constant support,
please accept, Excellency, the expression of my distinguished
consideration.

DIBY Koffi Charles

End of translation of text.

NESBITT