Sanctions Hurt Ivory Coast Economy

Photo: AFP

Security contain clients standing outside the headquarters of the Bicici bank as they came to withdraw money in Abidjan, March 3, 2011

Economic sanctions against Ivory Coast are hurting business in the world's top cocoa producer.

Thousands of civil servants line up along Abidjan's Rue des Banques, waiting to be paid their February salaries. When foreign banks closed last month because of regional sanctions against incumbent President Laurent Gbagbo, his government faced its biggest economic challenge yet: finding the cash to pay its workers, especially its soldiers.

Gbagbo's government quickly took charge of those banks and reopened them this week, just in time to pay civil servants 80 percent of their normal salaries.

"That will be a great success. I am sure they will be able to do it," said English teacher Ibrahim Kalo.  He says the regional central bank move to cut off the Gbagbo government was a challenge to all Ivorians - a challenge that has been met.
"I think this was an operation to diabolize [demonize] the government of Cote d'Ivoire,” Kalo added. “But I think they can pay us. That is why we are standing now in the queue. You can see from all the banks here long lines of people waiting for money, and they will be paid. You can be sure of that. There is no trouble."

Winceslas Appia, general manager of Abidjan's Bank for Agricultural Financing says there is enough cash to take care of everyone. So people should remain calm, he said. Appia said the banks have put in place measures to reinforce their staff so everyone will be served.

Withdrawals limited

Personal withdrawals are limited to about $425 a day. Gbagbo's Minister of Economy and Finance, Desire Dallo says those limits are meant to help the banking system stay solvent.

Dallo is asking people not to withdraw all their money because the banking system works only if there is a balance between deposits and loans. Dallo said it is obvious that people are afraid that banks will close again. But he said these are now state-run banks that will not fail, so account holders should not panic and withdraw all their money because that will not help.Read More