Privatization in Cote d'Ivoire

Privatization in CÔte d’Ivoire
Country Fact Sheet

Produced by MIGA and the Africa Region of the World Bank – June 2001

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Centre de promotion des investissements en Côte d’Ivoire (CEPICI), 5ème étage, B.P. V 152, Abidjan 01

Côte d'Ivoire
Tél. : (225) 20 21 40 70

Fax : (225) 20 21 40 71

Source Documents

Privatization Background

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With the pressing need to rehabilitate a deteriorated fiscal position and to improve the role of the private sector in fostering growth, Côte d’Ivoire adopted in 1990 a privatization program, well before most of Sub-Saharan African countries. Initially, the privatization portfolio was constituted by 54 public enterprises for the period 1991-1994. That number was then increased to 71. Privatization transactions were modest until 1994 when the devaluation of the Franc Cfa brought better perspectives for the economy. The two largest transactions of the program: PALM INDUSTRIE and CI-TELCOM were finalized in December 1996 and January 1997, respectively. By the end of September 1997, 46 enterprises were privatized, including major agro-industrial companies (rubber, palm-oil, sugar), the electricity and telecommunications entities, as well as railways. Four public enterprises were removed from the program. The international shipping agency, SITRAM, was liquidated.

From 1991 to 2000, 59 targeted enterprises were partially or totally privatized, 4 were removed from the program and 9 were still in the process of being sold. Just taking into account the number of transactions concluded, the program can be considered as one of the most successful in Africa.

Sector	Before 1995	1995	1996	1997	1998	1999	2000	Total
Services, tourism, real estate	3	0	4	6	3	1	0	17
Financial	0	2	1	0	0	1	1	5
Manufacturing, industry	5	4	4	2	1	2	0	18
Agriculture, agroindustry	5	16	10	3	4	0	2	40
Energy, telecom, utilities	4	4	1	4	0	1	0	14
Transport	2	1	0	0	2	0	1	6
Other	2	0	0	0	1	1	0	4
Total no. of Transactions	21	27	20	15	11	6	4	104
Total sales value (US$ m)	32.9	81.07	111.36	254.55	80.06	21.58	9.58	591.1

Source: Africa Region Privatization Database, The World Bank

Note: Some companies can have multiple transactions

Competitive vs. Non Competitive Methods in Côte d'Ivoire

Method of Privatization	Number	Percentage
1. Competitive methods	34	73.9
a. Sale of shares by public flotation	12	26.1
b. Sale of assets through competitive bidding	10	21.7
c. Sale of shares through competitive bidding	10	21.7
d. Leases/concessions	2	4.4
2. Noncompetitive methods	9	19.6
a. Direct sale of shares	7	15.2
b. Sale of assets through direct negotiation	1	2.2
c. Liquidation	1	2.2
3. Unspecified	3	6.5
Total	46	100.00

Institutional Framework for Privatization

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The Government entity in charge of the privatization program is the Privatization Committee strengthened by a Technical Secretariat, the Cellule Technique du Comite de Privatisation.

In 1993, to enhance the legal and institutional framework, the 1990 privatisation decree was converted into a law which was enacted in July 1994. In May 1997, the Fonds National de Soutien a la Privatisation (FNSP) was created to encourage acquisitions by Ivorians and to promote the stock exchange.

The World Bank has supported Private Sector Development (PSD) and privatization in Côte d’Ivoire through projects such as:

· the Privatization Support Project approved in May 1992 and closed in September 1999 (US$15 million);

· the PSD project in 1996 (US$ 54.6 million);

· the PSD adjustment credit project approved in April 1996 and closed in March 1999 (US$180 million) and

· the PSD Capacity Building Project approved in June 1998 and closing in March 2002 (US$12 million).

Privatization Program Status

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Progress in the implementation of the program was slowed by the political situation in 2000 and beginning of 2001. Nevertheless, for 2000, 4 public enterprises were sold. Among them, the Banque Internationale pour l’Afrique Occidentale en Cote d’Ivoire (BIAO-CI), sold for $8.96 million. At the end of May 2001, the privatization program was still not resumed.

Outlook

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