RESTRICTED
WORLD TRADE WT/TPR/M/2
21August 1995
ORGANIZATION(95-2441)
Trade Policy Review Body
4-5July1995
TRADE POLICY REVIEW
CÔTED'IVOIRE
MINUTES OFMEETING
Chairman: Ambassador Nestor Osorio Londoño
Page
I. INTRODUCTORY REMARKS BYTHE CHAIRMAN 2
II. OPENING STATEMENT BYTHE REPRESENTATIVE OF
CÔTED'IVOIRE 3
III. STATEMENT BYTHE FIRST DISCUSSANT 4
IV. STATEMENT BYTHE SECOND DISCUSSANT 7
V. STATEMENTS BYMEMBERS 9
VI. REPLIES BYTHE REPRESENTATIVE OFCÔTED'IVOIRE
AND ADDITIONAL COMMENTS 13
VII. CONCLUDING REMARKS BYTHE CHAIRMAN 19WT/TPR/M/2 Trade Policy Review Mechanism
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I. INTRODUCTORY REMARKS BYTHE CHAIRMAN
1. TheChairman welcomed alldelegations tothefirstmeeting oftheTrade Policy Review Body
(TPRB) oftheWorld Trade Organization (WTO). Thepurpose ofthemeeting wastoconduct the
trade policy review ofCôted'Ivoire. TheChairman welcomed theCôted'Ivoire delegation, headed
byH.E. Ferdinand Angora Kakou, Minister ofIndustry andTrade, aswellasthediscussants,
Mr.HervéJouanjean(EuropeanCommission)andMr.JohannesHuman(SouthAfrica).Thediscussants
would speak intheirpersonal capacities.
2. Following theadoption oftherulesofprocedure (WT/TPR/W/4), theChairman recalled the
objectives oftheTrade Policy Review Mechanism (TPRM), asdecided bytheCONTRACTING
PARTIES on12April 1989 (BISD 36S/403). Themeeting wastobaseitswork ontworeports, one
submitted bytheGovernment ofCôte d'Ivoire (WT/TPR/G/2) andtheother bytheSecretariat
(WT/TPR/S/2). Herecalled theprocedures forconducting reviews, introduced inMay 1993
(document L/7208).
3. Canada andtheUnited States hadgiven advance notice inwriting ofpoints theywished to
raiseduring themeeting.Republic ofCôte d'Ivoire WT/TPR/M/2
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II. OPENING STATEMENT BYTHE REPRESENTATIVE OFCÔTED'IVOIRE
4. Attheoutset, therepresentative ofCôted'Ivoire congratulated Mr.Renato Ruggiero onhis
appointment. Hethanked thetwodiscussants fortheirparticipation andtheSecretariat forthetechnical
assistance ithadprovided toCôted'Ivoire onmany occasions. Thereview ofCôted'Ivoire 'strade
policies wastaking place atacrucial moment inthecountry 'seconomic history. After adjusting the
parity ofitscurrency andsuccessfully implementing itsstructural adjustment programme, Côted'Ivoire
hadrecorded positive growth of2percentin1994.
5. Côted'Ivoire became aGATT contracting party asearly as31December 1963, three years
afterattaining independence, andanoriginal Member oftheWTO upon theentry intoforce ofthe
Marrakesh Agreement. Thisborewitness toitsinterest in,andcommitment to,themultilateral trading
system andthemajor principles ofpredictability andtransparency thatunderpinned it.
6. Despite many obstacles interms oftechnology andinfrastructure, during thefirsttwodecades
ofitsexistence Côted'Ivoire hadexperienced "theIvorian economic miracle", inwhich itsdevelopment
hadbeendriven bytheexploitation ofitsagricultural andforestry resources. Thismiracle waspossible
onlybecause thegovernment hadopted foreconomic liberalism, which encouraged investment. For
example, boththeInvestment CodeandtheCustoms Tariff werefavourable toinvestment. Accordingly,
Côted'Ivoire wasfirmly oriented towards external markets.
7. During thisperiod, there wasgreater government intervention intheeconomy intheformof
equity holdings inmany companies andthecreation ofnewState enterprises ornewstructures such
astheAbidjanStockExchange.Thisgovernmentintervention,designedtomakeupfortheshortcomings
oftheprivate sector, increased overtheyears andresulted inagrowth rateofasmuch as10percent.
Thisgrowth trendwasbroken bythecrisis ofthe1980s, whose mainfeatures wereasharp deterioration
intheterms oftrade, overvaluation oftheCFA franc andexcessive debt.
8. Asfrom1990, adjustment efforts werestrengthened witheconomic stabilization andrecovery
programmes suchasthePASFI (finance), PASA (agriculture) andthePASCO, which wasdesigned
torestore theoverall competitiveness oftheeconomy. These adjustment programmes were aimed
atstabilizing andbalancing public finances, andrestoring economic growth byattributing amajor role
totheprivate sector. Henceforth, government intervention would beconfined tolaying down therules
ofthegame; thecorollary offullliberalization wasderegulation andadjustment ofthenational economy
tothelawsofcompetition andthemarket-place.
9. These various measures hadalready ledtoaturn-around andsurplus intheprimary balance
oftheState'sfinancial operations. Growth hadaccelerated, reaching 6percentinthefirsthalfof
1995, andtheauthorities werehoping foradouble-digit annual growth rate,asachieved inthepast.
National resources wereincreasingly devoted totheproduction sector, thanks tothesimplification of
administrative procedures, theelimination ofnon-tariff barriers, thereduction andbinding ofcustoms
duties, priceliberalization andgovernment withdrawal frommosteconomic activities. These measures
wereaimed atreducing production factor costs and,withthechange intheparity oftheCFA franc,
enhancing economic competitiveness.
10. Further efforts would have tobemade toattain thedesired goalofdouble-digit growth
underpinned byamodern agricultural sector, aproductive mining sector, andtrade based onthenew
ruleslaiddown bytheWTO. Theobjective oftradepolicy wastostrengthen andmodernize domestic
trade, inparticular through greater participation ofnationals, andtomake rational useofallthenew
WTO instruments inorder toincrease Côted'Ivoire 'sshare ininternational trade, relying onWTO
technical assistance todevelop national expertise.WT/TPR/M/2 Trade Policy Review Mechanism
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III. STATEMENT BYTHE FIRST DISCUSSANT
11. Thefirstdiscussant (Mr. Hervé Jouanjean) expressed hissatisfaction atparticipating inthe
review ofCôted'Ivoire 'strade policy, which wasanimportant event foranumber ofreasons. To
begin with, itwasthefirstreview ofCôted'Ivoire under theTPRM. Secondly, itwasalsothefirst
review carried outunder thenewWTO procedures: ittherefore covered aspects relating notonlyto
trade ingoods, butalsotoservices, intellectual property andalltheother sectors covered bythe
Marrakesh Agreement; thefactthatCôted'Ivoire hadjoined theOrganization atitsinception reflected
thecountry 'scommitment tothemultilateral system. Lastly, thereview wastaking place atakey
moment forCôted'Ivoire 'seconomy, 18months afterthedevaluation oftheCFA franc which had
hadatremendous impact ontheeconomies concerned.
12. Formany years, Côte d'Ivoire hadbeen synonymous with"miracle". Foralongperiod
following independence in1960 uptothe1980s, Côted'Ivoire experienced exceptional growth, with
anaverage realannual GDPgrowth rateof6.8percent. Critics ofthisexceptional period sometimes
considered thatthiswas"growth without development", which waspurely fuelled bytheexterior.
Thecountry'seconomicdevelopmenthadbenefitedfromaverystablepoliticalandregulatoryframework
thatattracted foreign investors. Allsectors oftheIvorian economy haddeveloped harmoniously under
liberal Stateguidance. TheAbidjan Stock Exchange wasthemoststriking illustration ofthissuccess.
13. Since theearly 1980s, GDP involume terms hadceased toincrease andevenshrunk slightly.
Under theimpact ofhighpopulation growth, from 8.3million inhabitants in1980 to14.4million in
1994, percapita GDP hadevenfallen bytwothirds inUSdollar terms. Export agriculture remained
thebasisofthecountry 'sdevelopment (coffee, cocoa, bananas andwood) and,withtheslump inworld
prices, hadcontributed totheIvorian economy 'svulnerability, despite major growth ofmanufacturing
investment intheagri-food industry.
14. Despite theinternal adjustment policy pursued between 1981 and1993, theGovernment had
notmanaged toredress seriously themacroeconomic imbalances andmodify thestructural factors that
blocked growth. Thedecision tochange theCFA franc/French franc parity meant thatthedomestic
adjustment process could becomplemented attheexternal level. Thiswasthecontext inwhich the
Government hadintroduced theneweconomic stabilization andrecovery programme thatwasnow
theframework forthedevelopment ofCôted'Ivoire 'strade policy. Thecurrent objectives were as
follows:
- ariseintherealgrowth rateofGDP toover6.5percentannually asfrom 1995;
- larger budget surpluses;
- institutional reforms andspeeding-up oftheprivatization programme soastoimprove
public sector efficiency;
- reform ofthetrade, price andeconomic regulation mechanisms soastoenhance the
country 'sexternal competitiveness; and
- intensive development ofhuman resources.
15. Onthewhole, theIvorian economy appeared tohaveresponded positively totheshiftinrelative
prices brought about bydevaluation andthesharp increase inthecompetitiveness ofproduction sectors.
Despite thefallindisposable realincome, GDPgrowth in1994wasnearly 2percent,primarily thanks
totheriseinagriculturalandlivestockproductionandtherecoveryinmanufacturing,particularlytextiles
andchemicals. Theupturn inproduction andexports wassignificant inthecaseofnon-traditionalRepublic ofCôte d'Ivoire WT/TPR/M/2
Page 5
agricultural products suchaswood, palmoil,rubber andsome manufactured goods suchaspreserved
fish,cement andinstant coffee.
16. Thisrevival ofeconomic activity wasprimarily based onhigher utilization ofexisting capacity,
ariseinpublic investment andnewdirect investment intheoilandnatural gasandenergy sectors.
Thetotalinvestment raterosefrom8percentofnominal GDPin1993to13percentin1994. Domestic
saving increased considerably, from 15.3percentofGDP in1993 toover26percentin1994, in
conjunction withthecontraction ofprivate consumption, thestrengthening ofpublic finances andthe
improvement ofrawmaterial prices.
17. Growth forecasts for1995 amounted to6.5percentbytheIMF and7percentbythe
Government. Current budgetary outlays, excluding interest, were inlinewithprogramme targets.
Wage costs remained below forecast, owing inparticular toareduction ofalmost 3percentinthe
number ofpublic employees. Following significant lagsinthefirsthalfoftheyear,investment spending
picked upconsiderably inthesecond halfoftheyear, andevenexceeded thelevelinitially envisaged
thanks totheefforts made toreform administrative procedures inthisfield. However, itwasprimarily
self-financed investment spending thataccelerated orexceeded initial expectations inthisway,whereas
project-aid remained wellbelow forecasts. Intheinterests ofrestoring private sector confidence, the
Government hadstepped upthesettlement ofarrears indomestic payments.
18. These macroeconomic andfinancial developments ledtoagreater thanexpected improvement
inthecurrent account andoverall account ofthebalance ofpayments. Thanks tothe4-per-cent rise
inthevolume ofexports, 9-per-cent reduction inthevolume ofimports and13-per-cent improvement
intheterms oftrade, thesurplus onthebalance ofgoods andnon-factor services almost doubled, rising
from7percentofGDPin1993to13percentin1994, compared to11.4percentintheprogramme.
Taking intoaccount interest charges andnettransfers, thebalance-of-payments current deficit fellfrom
10percentofGDP in1993 to1.6percentin1994, rather thanthe6.9percentenvisaged. Owing
tothelarge inflows ofprivate andpublic capital, thebalance ofpayments recorded asurplus of
US$402 million, withaconsiderable strengthening oftheCentral Bank'sexternal position.
19. Although in1994 theGovernment concentrated itsefforts primarily onthemanagement of
macroeconomic policies toaccompany thedevaluation, anumber ofstructural reforms wereintroduced
inorder toliberalize theeconomy andreduce theroleofthepublic sector. Thus, theGovernment,
lifted non-tariff barriers, adopted anewlabour codesimplifying hiring andfiring formalities, privatized
seven enterprises andrestructured several public enterprises intheagricultural andprivate sectors.
20. Rural incomes improved under thecombined effect oftheexchange rateadjustment andthe
accompanying measures. Admittedly, theriseinprices paidtoproducers ofexport crops onlypartially
reflected world pricetrends expressed inCFAfrancs, butitdidleadtoariseinruralincome in1994.
Ontheotherhand,theincomeofthedeprivedurbanpopulationdeclinedinrealtermsdespitegovernment
efforts toholddown prices ofsome staples suchasrice,school books andmedicines. Other measures
thatform partofthesocial security safety-net, inparticular spending targeted atcertain vulnerable
groups andlabour-intensive public works, onlypartially attained theexpected results.
21. Besides tapping public aid,theGovernment hadundertaken orenvisaged aseries ofactions
abroaddesignedtomakeprivateinvestorsawareoftheneweconomicprospectsofferedbyCôted'Ivoire.
Increasing theflowofprivate capital wascertainly theonlystrategy compatible withthehighgrowth
rates("double-digit" fortheendofthedecade) forecast bytheGovernment.
22. Thefirstdiscussant went ontonotethattheIvorian economy 'scompetitiveness hadbeen
significantly enhanced bythechange intheparity oftheCFA franc. Toensure sustained growth,
theGovernment hadtaken averyhardlineoninflation, withatemporary price freeze, limited priceWT/TPR/M/2 Trade Policy Review Mechanism
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increases foressential goods, areduction ininternal andborder taxes, andbudgetary andmonetary
policy instruments. Theresults for1994 seemed tobeuptoexpectations. How didtheIvorian
Government intend toensure price stability when inthefoodsector there wasalready strong demand
forlocalsubstitution products, together withlocal shortages andprice hikes? How didtheIvorian
Government intend toconsolidate thecompetitiveness oftheeconomy anddiversify production and
exports?
23. Wasitthecasethat"recentexportpolicyreflectslittleattemptatliberalization:theadministrative
procedures canbefurther simplified, while thedomestic environment continues tohamper thesector 's
performance"? What wasthesituation inthecaseofimports?
24. Agrowth rateof8.7hadbeensuggested for1997, andevendouble-digit growth fortheend
ofthecentury. DidtheIvorian authorities share theviewthat"future growth would depend toalarge
extent onCôted'Ivoire 'sability toattract investment"? Were thereanysigns thatexpectations inthis
fieldwould bemet? Could thedomestic saving ratebeexpected tostabilize atthehighlevelithad
onceagain reached?
25. In1994theGovernment hadessentially attained itsbudgetary objectives bydrastically reining
incurrent budgetary spending, which hadmade itpossible tofinance thegrowth ofpublic investment.
Nevertheless, theburden ofpublic debtremained particularly high. Inthesecircumstances, howcould
theneedtotapresources torepay thedebtbereconciled withthetaxcutsneeded torestore theIvorian
private sector 'scompetitiveness?
26. TheIvorian authorities hadopted forcloser integration ofthecountries oftheWest African
Economic andMonetary Union (WAEMU). What weretheirobjectives inthisfield? What wasthe
expected impact ontrade flows? What attitude would Côte d'Ivoire takewithregard toregional
authorities suchasECOWAS?Republic ofCôte d'Ivoire WT/TPR/M/2
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IV. STATEMENT BYTHE SECOND DISCUSSANT
27. Thesecond discussant (Mr.Johannes Human) associated himself withthewelcome addressed
totherepresentative ofCôted'Ivoire, acountry thatwascommitted tothemultilateral trading system
andtheprinciple oftransparency. Thebroadly-based tradeliberalization programme hadbeeninitiated
inorder torevive aneconomy depressed byplunging commodity prices andarising realeffective
exchange rate. Theprogramme included notonlyasignificant reduction inimport tariffs butalsoan
easing ofnon-tariff barriers, aprivatization programme, andanewcompetition policy andinvestment
regime.
28. However, thisfirmchoice infavour ofamore liberal economy andheightened competition
might toacertain extent becompromised byacomplex tariff system involving fourdifferent import
duties, andtheexistence ofreference prices andalternate duties (comprising bothanadvalorem
component andaspecific component). Theremaining quantitative restrictions could alsoadversely
affect trade. Côted'Ivoire should beencouraged toincrease thenumber oftariffbindings forindustrial
products.
29. Although itwasnotasignatory totheAgreement onGovernment Procurement, Côted'Ivoire
hadaprocurement regime thatwasparticularly opentoforeign suppliers. DidCôted'Ivoire intend
tobecome amember ofthenewAgreement onGovernment Procurement?
30. TheIvorian economy wastoalargeextent based ontheexport ofagricultural products. This
made thecountry particularly vulnerable topriceordemand fluctuations onworld markets. Government
intervention inthepasttostabilize export prices andvolumes hadinvolved serious price risksandits
financial resources hadbeenputunder severe strain, especially during thelate1980s when world coffee
andcocoa prices hadslumped. Insome cases, theexistence ofofficial prices hadledtoillegal exports
ofcertain commodities.
31. Whyweresome agricultural sectors covered byprivatization orderegulation plans while other
important sectors remained under State control? What wastheGovernment 'sposition withregard
toStatetrading andexport monopolies? Diditintend tocontinue controlling prices andvolumes for
export, forexample inthecaseofcoffee andcocoa? Would references prices forcocoa exports remain
guaranteed? Wasthemarketing board -Caistab -going tocontinue managing payments atofficial
prices? IftheCaistab export monopoly wasmaintained, howwould theGovernment avoid wide
discrepancies between guaranteed prices toexporters andworld market prices?
32. Côted'Ivoire wastheworld 'slargest producer ofcocoa, which provided more thanaquarter
ofitsexport revenue, primarily fromtheNetherlands andFrance. TheEuropean Union hadrecently
announced certain changes initsregulations which might affect cocoa exports totheEuropean Union.
WastheGovernment considering diversifying itsexport markets inorder tominimize theimpact of
thenewregulations?
33. Until thelate1980s, almost 50percentofIvorian industry wasGovernment-owned, while
therestwasshared between theIvorian private-sector (10percent) andforeigners. Private capital
hadbeenconcentrated inarelatively small number ofenterprises. Since 1992-93, amajor privatization
programme hadconfirmed theGovernment 'sdetermination towithdraw from theproduction sector.
What wasthecurrent status ofthatprogramme andwhatwerethefactors towhich thedelays could
beattributed? Were measures being considered toensure thatStateenterprises didnotbecome privately
owned monopolies?
34. Theservices industries played akeyintermediate roleintheproduction andmarketing of
agricultural, energy andmanufactured products. Trade policy measures affecting services suchasWT/TPR/M/2 Trade Policy Review Mechanism
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transport, thesupply ofwater, electricity, fuel,irrigation aswellaswholesale andretail trade, finance
andinsurance hadadeterminant effect onforeign tradeperformance. Inthecaseofenergy distribution,
organized intheform ofexclusive concessions granted totheprivate sector, therateswere usually
negotiated insuchawayastoguarantee theconcessionaire stable remuneration whatever thetrend
inglobal prices. Inthecaseofwater, prices were fixed every fiveyears inthelightofproduction
costs andremuneration ofthesuppliers. Were anymechanisms planned toensure thathighprices
didnotundermine thecompetitiveness ofIvorian exports?
35. With regard tomaritime transport, onwhich more than90percentofIvorian external trade
depended, thesecond discussant noted thattwocompanies shared almost exclusive rights overtraffic
withCôted'Ivoire. Theobligation onexporters tousetheservices ofoneofthese twocompanies
might constitute anadditional costfornational industry asawhole. What reforms werecurrently being
undertaken inthissector?Republic ofCôte d'Ivoire WT/TPR/M/2
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V. STATEMENTS BYMEMBERS
36. Thedelegates welcomed thedelegation ofCôted'Ivoire andcongratulated Dr.Chulsu Kim
onhisappointment tothepostofDeputy Director-General.
37. Therepresentative ofCameroon stressed thatCôted'Ivoire hadbeenpartofthe"critical mass"
ofcountries necessary totheestablishment oftheWTO, andnoted theactive rolethatithadplayed
throughout theUruguay Round, particularly withrespect totrade incommodities. With aview to
improving thefollow-up totheconclusions oftheUruguay Round andensuring their rational
implementation, aliaison committee between thepublic andprivate sectors hadbeensetupbythe
Ivorian authorities, reflecting theIvorian Government 'scommitment tostreamlining administrative
procedures foreconomic operators. Itwasnowuptothepartners ofthedeveloping countries togive
substance totheircommitments, particularly withrespect tospecial anddifferential treatment infavour
ofthedeveloping countries, sothattheCôted'Ivoire could achieve fullrecovery.
38. Thespeaker wentontoaskwhatspecific measures hadbeentaken byCôted'Ivoire following
thechange inparity andtheimpact ofthose measures onthecountry 'seconomy ingeneral andon
itsforeign trade inparticular. Wasittruethatthere wasnofree-trade zoneinCôted'Ivoire?
39. Therepresentative ofMorocco pointed outthatCôted'Ivoire, likemany other countries, faced
anerosion ofthepreferential margins initstraditional markets following theconclusion oftheUruguay
Round, evenifthedevaluation hadbeenabletominimize theeffects ofthaterosion intheshort term.
Nevertheless, there remained thelong-term problem ofexternal competitiveness: howdidthe
Côted'Ivoire Government intend tomaintain andevenincrease itsshare ofitstraditional markets
following theMarrakesh Agreements?
40. Therepresentative ofSenegal joined theother delegates incongratulating Côted'Ivoire for
itsclearstance infavour ofliberalism andopenness totheoutside, asaresult ofwhich itwould not
haveanyparticular trouble inmaking theadaptations needed tocomply withtheMarrakesh Agreements.
Theoffermade byCôted'Ivoire within theframework ofthose negotiations hadbeendeemed tobe
adequate andinconformity withitslevelofdevelopment. However, these efforts hadtobemetwith
similar efforts onthepartofthedeveloped countries andtheinternational financial institutions inthe
form ofmassive contributions ofresources conducive togrowth andsustainable development. The
decrease intariff andnon-tariff protection, particularly foragriculture andtextiles, would permit the
Ivorian economy toprofit more fullyfromthenewenvironment thatwastaking shape. Côted'Ivoire
would alsohavetheopportunity ofdeveloping industries producing products withahigher value added,
since thelowering oftrade barriers affected those products toamuch greater extent.
41. TherepresentativeofCanadanotedthattheshareoftheotherAfricancountriesinCôted'Ivoire's
foreign trade haddoubled since 1985, atrend which hadbeenreinforced bytherecent devaluation
oftheCFAfranc. However, thecountry remained heavily dependent oncommodity exports. Inthat
connection wasittrue,assuggested intheReport bytheSecretariat, thatthegrowth inexports of
commodities subject totaxes, monopolies andother administrative procedures hadbeenslower than
thegrowth inexports ofproducts notsubject tosuchrestrictions?
42. Thespeaker noted withsatisfaction theefforts made byCôted'Ivoire atdiversification and
recognized theexistence, insome cases, ofconsiderable commercial barriers tothefurther processing
ofsuchproducts. Henoted theabsence ofanexport promotion strategy andofinstitutions capable
ofsupporting private export efforts. HadCôted'Ivoire received anyassistance fromtheInternational
Trade Centre inthatregard? Where could further assistance bestbetargeted toaddress thatconcern?WT/TPR/M/2 Trade Policy Review Mechanism
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43. Inspiteoftheelimination ofsubsidies andthereduced protection ofestablished industries,
therewasalackofinternal competition intheIvorian economy, inwhich mostsectors weredominated
byoneortwoenterprises. Inthatrespect, whatwerethepriorities ofthenewCompetition Commission
withaviewtoimproving thecompetitiveness oftheeconomy?
44. Itwasnecessary tostreamline import procedures, particularly the"other duties andcharges"
andVAT, generally higher onimported goods. Canadian companies hadcommented ontheburdensome
andlengthy customs procedures. DidCôted'Ivoire intend tosimplify those procedures? What trade
measures were maintained forenvironmental protection purposes?
45. Theservicessectoraccountedformorethanonethirdofthecountry'sGNP,andwasparticularly
open, asdemonstrated bythelarge foreign presence. TheIvorian authorities should, therefore,
participate more actively inthetelecommunications andmaritime transport negotiations being held
under theauspices oftheWTO. Finally, abody should becreated toreview andassess thecountry 's
trade policy.
46. Therepresentative oftheUnited States commended theGovernment ofCôted'Ivoire forhaving
reduced itstariffs by50percentandliberalized itstrade despite adepressed economy inacontext
ofsubstantial exchange-rate fluctuations. These efforts, combined withrevised investment policies,
would serve boththeeconomic interests andthesocial welfare ofCôted'Ivoire byexpanding trade
flows, attracting foreign capital andinvestments andproviding formore consumer choice.
47. However, Côted'Ivoire hadreintroduced export taxes oncoffee andcocoa, anaction which
could havenegative effects ontheproduction levelofthose commodities which weresovitaltothe
Ivorian economy. Lessharmful sources ofrevenue should besought. Acceleration oftheprivatization
programme would make itpossible tostrengthen economic growth while increasing Stateresources.
Liberalization ofcertain sectors hadbeenslowed asvested interests hadtriedtoblock thereform process.
48. Thepersistent prevalence ofnon-tariff tradebarriers wasasource ofconcern: theywereoften
more trade-distorting thantariff barriers. What were theGovernment 'splans withrespect tothe
elimination ofnon-tariff tradebarriers before 1January 1996? Inparticular, howwerethesequantitative
import restrictions administered? What weretheprocedures forobtaining priorapproval orpermission
from thetechnical ministries? Didtheydiffer foreachministry?
49. Theprices of22goods andservices remained under administrative control. Which ofthese
weretobederegulated byJanuary 1996? When didCôted'Ivoire intend toapply alloftheprovisions
oftheAgreement oftheImplementation ofArticle VII? Why were there stillrestrictions ontrade
inrice,coffee, flour, sugar andrawtobacco? WasittruethatCôted'Ivoire nolonger maintained
anyexport subsidies? Wastheuseofminimum import prices truly inkeeping withtheprovisions
ofArticle 4.2oftheAgreement onAgriculture?
50. Towhat extent didthenewInvestment Code comply withallprovisions oftheAgreement
onTRIMs? When would theCode beimplemented? What restrictions existed forforeign investors
inthefinancial services, building andpublic works sectors? What restrictions weretherewithrespect
toemploying managers? Whodecided whether international ornational quality standards hadbeen
met?
51. Wasittruethatthesystem oftaxation offered protection todomestic industries? Hadanyrecent
changes taken place intheinternal taxation system? Wasthesystem inconformity withtheobligations
contained inArticle III?DidtheCôted'Ivoire provide product patent protection forpharmaceutical
andagricultural chemicals? Ifnot,what steps didtheauthorities intend totaketocomply with
Article 70(8) oftheTRIPs Agreement? Were there anyexceptions tonational treatment ortheMFN
principle withrespect tointellectual property?Republic ofCôte d'Ivoire WT/TPR/M/2
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52. Thepersistenceofmonopoliesintheservicessector,especiallywithrespecttoaircargotransport,
wasasource ofconcern; wasanyliberalization planned forthatsector? Towhat extent had
Côted'Ivoire fulfilled itsobligations withrespect tonotifications?
53. Therepresentative ofHong Kong noted thattheCôte d'Ivoire hadopted against State
intervention. Thereduction byhalfofimport duties wasquiteremarkable inviewoftheirimportance
inthecountry 'sState budget. Theinvestment regime wasgoverned bytheprinciples ofMFN and
national treatment. Theannounced revision oftheimport regime waswelcome, andwould perhaps
leadtoitssimplification.
54. Therepresentative oftheEuropean Communities joined other speakers incongratulating the
Government ofCôted'Ivoire forthereforms thathadbeenintroduced, which hadbeenunanimously
welcomed byallthecreditors oftheCôted'Ivoire Consultative Group attheirrecent meeting inParis.
However, customs revenue accounted for50percentofGovernment revenue; where didtheIvorian
Government plantofindthefinancial resources necessary tomaintain abalanced budget andavoid
compromising itsliberalization efforts?
55. Thecommitment oftheIvorian authorities withrespect toregional integration wasappreciable.
TheCôted'Ivoire 'ssupport forthecreation oftheWestAfrican Economic andMonetary Union should
make itpossible forthecountry toderive fullbenefit from itssituation asregional hub.
56. TheIvorian Government hadalsomade certain commitments towards theliberalization ofthe
main production sectors, interaliathrough achange intheparity oftheCFA franc. Asignificant
dropinfoodimports wasexpected. Thiscould encourage thedevelopment offoodproduction aswell
astheexport ofprocessed foodproducts towards thesubregion.
57. The"single-window" initiative, which hadbeeninoperation since 1995, provided aclear
illustration oftheGovernment 'sdetermination toencourage therevival ofprivate investment. The
representative oftheCommission asked whether areversal ofdirect investment trends hadmade itself
feltyet.Ifso,towhatextent wasthisrelated tothose newinitiatives, tothechange inparity orto
other liberalization measures?
58. Maritime transport wasessential forCôted'Ivoire. Theduopoly situation hadhadanegative
impact onthecostofexports andimports. Recent measures taken bytheIvorian Government would
make itpossible tosubstantially reduce transport costs andthustocontribute toward improved
competitiveness. What, infuture, would Côted'Ivoire 'spolicy befollowing theelimination ofthe
OICandSITRAM?
59. Therepresentative ofJapan joined theother participants inhighlighting theconsiderable effort
thathadbeenmade byCôted'Ivoire toward theliberalization oftrade, andwondered whysuchalimited
number ofindustrial products hadbeenbound. What weretheGovernment 'splans inthatrespect?
Anumber ofclarifications would beneeded withrespect toregional integration.
60. Therepresentative ofGabon shared theviewthatexternal technical andfinancial assistance
wasnecessary inorder toovercome theriskofmarginalization oftheIvorian economy.
61. TherepresentativeofEgyptnotedthatthemainobjectiveofthereformsinitiatedinCôted'Ivoire
wasexport-led economic recovery. Côted'Ivoire would therefore needthesupport oftheinternational
community,particularlyfollowingtheerosionofitspreferentialpositionontheEuropeanUnionMarket.WT/TPR/M/2 Trade Policy Review Mechanism
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62. Therepresentative ofNigeria tooktheview thatthesuccess ofthereforms currently under
waydependedlargelyondirectforeigninvestment.Inthatrespecthestressedtheimportanceofreducing
theperceived riskfrom theinvestors 'standpoint inorder toencourage foreign investment. Withrespect
totradeandtheenvironment, whathadbeentheimpact ofexport taxesonproducers andoninternational
trade, andwhatwere thereasons fortherecent dropinexports ofrough timber.Republic ofCôte d'Ivoire WT/TPR/M/2
Page 13
VI. REPLIES BYTHE REPRESENTATIVE OFCÔTED'IVOIRE AND ADDITIONAL
COMMENTS
(1) Improvement ofthemacroeconomic environment
63. Aplanforthereform ofthepublic sector andtheprivatization ofsome 60State enterprises
hadbeeninitiated in1991 toaccompany thethree sectoral adjustment plans. Sofar,20enterprises
hadbeenprivatized andtheprocess hadcontinued atanincreased pacesince thedevaluation ofthe
CFAfranc. Theprogramme fortherehabilitation ofthefinancial sector (PASFI) hadmade itpossible,
interalia,tostreamline andrestructure thefinancial institutions, restore theliquidity ofthebanks,
introduce significant improvements atthemonetary policy levelandimprove financial intermediation
mechanisms.
64. Asaresult ofthesemeasures, theprimary balance oftheState'sfinancial operations hadmoved
froma225billion CFA franc deficit in1989 toasurplus ofover60billion CFA francs in1994. At
thesame time, thehitherto persistent downward trend inGNP hadbeenhalted, growth hadresumed
in1994, andthenecessary foundations forrecovery hadbeenlaid.Thanks toabetter focused monetary
policy, ithadbeenpossible tocontrol inflation, evenaftertheliberalization ofprices thathadbeen
temporarily frozen following thechange intheparity oftheCFA franc.
65. Inorder toattract investors, ithadthenbeennecessary toimprove thebusiness environment
andthelegalandregulatory framework ofeconomic activities. Accordingly, apolicy ofpromotion
ofinvestments andwithdrawal oftheStatefromtheproduction sector wasimplemented. These steps
included significant tax-reduction measures, suchasthelowering ofimport duties (fiscal dutyplus
customs duty) fromamaximum rateexceeding 100percenttoapproximately 40percent; thereduction
innumber andharmonization ofVAT rates; theelimination ofthe35percentincreased rateofVAT
aswellastheextension ofthescope ofVAT, andthereduction orelimination ofcertain levies. Added
tothese stepsaretheadvantages andincentives forinvestment contained inthedraftInvestment Code
andtheMining Lawestablishing better, more transparent, rapid andequitable conditions ofaccess
toalleconomic operators, regardless oftheirsectoral activity.
66. Thevarious internal adjustment efforts coupled withthechange intheparity oftheCFAfranc
hadalready ledtoanincrease inthevolume ofexports, theacceleration oftheprivatization process
andhigher customs revenue, thusmaking itpossible fortheStatetoreduce itsinternal debt. Although
theGovernmenthadgivenprioritytothesettlementofinternaldebt,restoringforeigninvestorconfidence
alsoinvolved settling theforeign debt.
Additional comments
67. TheChairman thanked theIvorian delegation foritspresentation ofthestabilization programme
currently under wayinCôted'Ivoire. These measures toenhance competitiveness would bemade
allthemore useful bythefactthattheywereaccompanied byefforts toimprove health andeducation
services.
68. Thefirstdiscussant asked forclarifications concerning medium-term investment prospects and
thesteps taken bytheauthorities toreduce investment riskinCôted'Ivoire. Wasittruethatlabour
costs weretwice ashighasincomparable countries? Ifso,whatweretheGovernment 'sobjectives
inthatrespect?
69. Thesecond discussant requested further information ontheprivatization efforts currently under
way.WT/TPR/M/2 Trade Policy Review Mechanism
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70. Therepresentative ofCôted'Ivoire replied thatonlythrough private investment would itbe
possible tomake upforthelagindevelopment caused bytherecession without increasing thedebt
burden.TogetherwithstabilityintheGovernment'seconomicpolicies,politicalstabilityanddemocratic
management aswellasefforts toovercome poverty constituted thebestsafeguard against theriskof
investing inCôte d'Ivoire. Thepublic sector -private sector Liaison Committee hadbeentasked
withanalysingthemainproblemslikelytoimpedegrowthintheprivatesector.Theseproblemsincluded
theinternal debt, taxreduction, thesecurity ofgoods andpersons, thereform ofthejudicial system
andtraining.
71. The"single window" wasasingle centre fortheprocessing ofinvestment formalities in
Côted'Ivoire. Whereas previously, under theapproval regime, awaiting timeofuptooneyearcould
beexpected, now, under thedeclaration regime, anoperator waited amaximum of48hours. Under
thenewapproval regime, which concerned investments ofmore than500million CFA francs, the
maximum waiting timewas45days.
72. Since thedevaluation, allprivatizations weresubject toaninternational callfortenders. The
entire rubber production sector hadalready been privatized. Theprivatization ofthecompany
CI-Telecom hadbegun, aswellasthatofPalmindustrie. TheIvoire Hotel wasalsoincluded in
privatization plans. Ingeneral, theStateretained 20percentofshares inprivatized companies, while
30percentwereplaced ontheAbidjan Stock Exchange andtherestsoldtotheprincipal shareholder.
BytheendofJune, privatization hadalready brought insome 30billion CFA francs.
73. Thecostoflabour wasindeed higher thaninsome countries. Children under 16years ofage
werenotallowed towork; wage structures reflected Stateintervention toacertain extent, particularly
withrespect totaxation. Intheframework oftheadjustment programme, alltaxes onlocal labour
hadbeenabolished, andwage negotiations tookplace freely between theunions andtheemployers.
Thus, thecostoflabour hadprogressively beenbrought intolinewithcomparable countries, andwas
infactlower thaninMorocco following thedevaluation.
(2) Thedevelopment oftrade
74. Therepresentative ofCôted'Ivoire wentontofocus onIvorian trade development strategy.
With respect toagriculture, thestrategy consisted instrengthening production oftraditional products
anddeveloping anddiversifying non-traditional agricultural exports. Thepromotion offoodproduction
anddevelopment ofagro-industries would make itpossible toprocess rawmaterials andexport
semi-finished andfinished products. Theexploitation ofoilfields andgold, manganese andnickel
deposits would leadtothedevelopment ofthemining sector, andtheresulting production would permit
Côted'Ivoire tobeself-sufficient by1995-96 andeventoexport thereafter. Theexploitation ofnatural
gaswould permit thecountry tocover itsdomestic needs inelectricity, andeventoexport electricity
toneighbouring countries.
75. Intheservices sector, Côted'Ivoire could playanessential roleinthesubregion, particularly
through thedevelopment andtransformation oftheAbidjan Stock Exchange intoaregional exchange.
Otherkeysectorswerebankingandinsurance,tourism,telecommunicationsandtransport:Côted'Ivoire
wasthechief transit andtransshipment hubinthesubregion.
76. Thecreation ofCentre forthePromotion ofInvestments inCôted'Ivoire (CEPICI) andthe
formationoftheNationalCommissionforInvestmentPromotion(COMINVEST)providedaframework
forimproved cooperation between thepublic andprivate sectors. Themainfunctions ofCEPICI were
tostreamline administrative procedures withrespect totheestablishment andoperation ofenterprises
andtospeed upformalities relating tothegranting ofadvantages toinvestors, inparticular those offeredRepublic ofCôte d'Ivoire WT/TPR/M/2
Page 15
within theframework ofthenewInvestment Code .Atthesametime, liketheUNCTAD Trade Point,
itprovided anexcellent framework forcontacts andcooperation between thepublic andprivate sectors.
77. Withthesignature oftheTreaty Establishing theWestAfrican Economic andMonetary Union,
itwaspossible tothink interms ofamarket ofover60million inhabitants fortheseven member
countries andtoenvisage theimplementation ofapreferential tariff regime fororiginating products.
Theultimate aimwastoachieve acustoms union based ontheapplication ofacommon external tariff.
Thus, Côted'Ivoire 'sparticular position within thesubregion andtheimproved competitiveness of
itseconomy provided genuine opportunities forinvestment.
78. Côte d'Ivoire hadasked thattheapplication oftheAgreement ontheImplementation of
Article VIIofGATT 1994 should bedelayed under thespecial provisions providing forspecial and
differential treatment ofdeveloping countries.
Additional comments
79. Thefirstdiscussant pointed outthatthemineral discoveries would remove agreat number of
external constraints from theIvorian economy, andasked about theobjectives andcurrent prospects
oftheWAEMU.
80. Thesecond discussant observed thatthestreamlining ofadministrative procedures wasvery
important, andasked about thereasons fortherecent growth inregional trade.
81. Therepresentative ofCôted'Ivoire explained, inreply, thattheWAEMU reflected thedesire
tocreate aneconomic union, aunion which already existed inpractice. Inaddition toharmonizing
customs duties, theUnion aimed atfurther harmonizing business law,ashadalready beendone in
theinsurance field. Atimetable fortheintroduction ofthose measures wastobedrawn upbythe
endof1995. Thesharp growth intrade following devaluation reflected theattraction ofIvorian
manufactured goods compared togoods imported from countries thatwerenotpartofthefree-trade
zone.
82. Therepresentative ofCanada stressed thatnon-traditional products, whose production andtrade
hadbenefitted from greater liberalization, seemed tohaveperformed better. Hewondered which of
theactivities oftheInternational Trade Centre (CCI) weremostapttofacilitate thecountry 'sexternal
trade.
83. Therepresentative ofCôte d'Ivoire replied thathiscountry 'snewphilosophy wasoneof
non-intervention inthegoods andservices production process. State intervention inthemarketing
ofcoffee andcocoa reflected theneedtoorganize thefarmers, generally verysmall planters, sothat
theycould defend theirowninterests. Programmes hadbeenintroduced withaview topermitting
young school leavers totakeupfarming. Thegrowth rateoffoodcrops hadbeenhigher thanthat
ofother crops, asfarmers were eager toexport those products following thedevaluation.
84. TheroleoftheAbidjan International Trade Centre (CCIA) would becompletely revised, and
there would nolonger beanyquestion ofofficials andadministrators assisting theprivate sector.
85. TheChairman underscored theproblems involved inmanaging thetransition towards the
exportationofnon-traditionalproducts.Verticaldiversificationwasverydifficult,andexposedexporters
tocompetition from buyers intheimporting countries. Moreover, itwasimportant totakeaccount
ofsocial structures indeveloping theproduction ofcommodities suchascoffee andcocoa: indeed,WT/TPR/M/2 Trade Policy Review Mechanism
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itwasamatter ofdeveloping theproduction ofhigher value-added products without abandoning the
basic resources thatwere socrucial tothesocial andeconomic development ofthecountries.
(3) Thetrade regime
86. Therepresentative ofCôted'Ivoire began bypointing outthatwithin theframework ofthe
nationaleconomicrecoveryprogramme,thecustomsadministrationhadundertakentosimplifyprocedures
andeasethetaxburden withaviewtoenhancing competitiveness. Inorder tospeed uptheremoval
ofgoods, thefollowing measures would nowbeapplied:
- automatic clearing ofmanifests;
- introduction ofanautomatic removal voucher (BAE) forpetroleum products andurgent
consignments, andobligation todeliver allother removal vouchers within aperiod
of48hours;
- introduction ofanaccelerated customs clearance procedure forperishable goods and
industrial inputs;
- reduction ofinspections inthehome.
87. Inaddition totheeasing ofthetaxburden through thereduction intaxrates, steps hadbeen
taken toharmonize duties andtaxes. Thus, products atthesame processing stage weresubject tothe
same rates: forexample, rawmaterials were subject toataxof10percentexcluding VAT,
semi-finished goods toataxof15to20percentexcluding VAT according tothedegree ofprocessing,
andfinished products toataxof25to30percentexcluding VAT. Overall, thetariff reform had
made itpossible toreduce thenumber ofratestosix.Allcustoms duties hadbeenconsolidated at
5percent. Theaimofthetariffstructure, consisting ofafiscal import duty, acustoms duty, astatistical
taxandVAT, wastomeettheTreasury 'sfinancial needs, while alsopermitting theimplementation
ofthecountry 'seconomic andtrade policy.
88. Riceandflourcould nowbeimported freely. Theintroduction ofasingle export dutyonwood,
coffee andcocoa reflected theGovernment 'sdesire toencourage increased processing ofrawmaterials.
Therevenue from thatdutywashanded overtotheTreasury andallocated tothegeneral operating
budget andthefarmers support fund. Theshare allocated tothegeneral operating budget hadbeen
negotiatedwithintheframeworkoftheState'sflow-of-fundstable(TOFE)withtheinternationalfinancial
institutions. Studies wereunder waytoreduce oreliminate export taxeswith, asacorollary, expansion
ofthetaxbaseandnarrowing ofexemptions.
Additional comments
89. Thefirstdiscussant asked whattheGovernment 'sobjectives were withrespect tobindings,
which were ofinterest notonlytotrade partners butalsotopotential investors. Theimport regime
wascomplex. Export taxes represented 30percentoftheIvorian budget, andeliminating themwould
consequently create aserious budgetary problem.
90. Thesecond discussant referred tothefourdifferent import taxrates, andasked forthereason
forthestatistical tax.
91. Therepresentative ofCôted'Ivoire replied thatbindings hadbeendecided asafunction of
thecountry 'slevelofdevelopment during aperiod ofcrisis, buthewasaware thatCôted'Ivoire would
havetogofurther ifitwanted toattract investors. Bolder offers would bemade asanaccompanimentRepublic ofCôte d'Ivoire WT/TPR/M/2
Page 17
totheexpected higher growth rate. TheGovernment wished toexpand thetaxbaseforthreereasons:
itwasnecessary toeasethetaxburden, allcitizens hadadutytopaytheirtaxes, andtheGovernment
wanted todevelop anewlandCode andcarry outanewsubdivision ofIvorian territory inorder to
beabletoprovide farmers withland.
92. Customs procedures andadministrative redtapehadmade transactions intheCôted'Ivoire
veryexpensive, which inturnhadhadanimpact onthecompetitiveness ofexports: thisapplied to
bothcustoms andtheportofAbidjan. With theexception ofcertain products, export licences had
beenabolished.
93. Thecountry 'srealestate wasnowincluded inasystematic inventory, which made itpossible
togenerate newtaxrevenue. Thestatistical taxhadbeenintroduced inorder toincrease government
revenue. Currently, thetaxserved tofinance thecustoms computer system (SYDAM). Therateof
taxation wasbeing reassessed. Thefourimport duties reflected thecountry 'smembership inWAEMU
orECOWAS.Thepriority,therefore,washarmonizationwithinWAEMUbeforecumulatingthevarious
taxcomponents.
(4) Thenewareas
94. Withrespect totransport, theGovernment hadjustdecided toeliminate theOICshippers 'visa
anddissolve SITRAM inorder torestore competition inthesector, thereby making itpossible toreduce
transaction costs.
95. With respect totelecommunications, theCI-Telecom billhadbeenadopted bytheNational
Assembly, andthecompany 'sassets werecurrently being valued priortoprivatization. Côted'Ivoire
would thusbeabletoparticipate inthenegotiations ontrade intelecommunications.
96. With regard tointellectual property, Côted'Ivoire wasasignatory totheParis Convention
fortheProtection ofIndustrial Property of20March 1883 initsmost recent revision, adopted in
Stockholm on1July1967; theConvention Establishing theWorld Intellectual Property Organization
(WIPO), signed inStockholm on14July1967; thePatent Cooperation Treaty (PCT), concluded in
Washington on19June1970(Law 89-1295 of18December 1989); theHague Agreement concerning
theinternational deposit ofindustrial designs (Law 92-953 of23December 1992); andfinally, the
Bangui Agreement, under which Côte d'Ivoire wasamember oftheAfrican Intellectual Property
Organization (AIPO). Côte d'Ivoire usedtheprovisions oftheBangui Agreement tofightagainst
counterfeitsintherealmofindustrialproperty.ThisAgreementalsoappliedtolicensingrights,industrial
designs, trademarks, geographical indications andpatents. Itsprovisions werenotalways compatible
withtheWTO Agreement onIntellectual Property Rights (TRIPs). Liketheother African countries
members oftheAIPO, Côted'Ivoire would havetobring itslegislation intolinewiththeTRIPs.
Additional comments
97. Thefirstdiscussantwelcomedthereintroductionofcompetitioninthefieldofmaritimetransport.
With respect totrade andtheenvironment, heasked theIvorian delegation todescribe anyexternal
measure affecting forestry inCôted'Ivoire.
98. Thesecond discussant asked what concrete measures hadbeentaken attheborder toavoid
trade incounterfeit goods. Therepresentative oftheUnited States observed thattheproblem of
population growth probably constituted themain cause notonlyofdeforestation, butalsoofthelow
growth ofincomes ingeneral.WT/TPR/M/2 Trade Policy Review Mechanism
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99. Therepresentative ofCôted'Ivoire pointed outthatasaresult primarily ofitinerant agriculture,
theforest oftheCôted'Ivoire hadshrunk from 13million to3million hectares since independence.
Since thebeginning oftheyear, theGovernment hadturned over25thousand hectares toindustry
forexploitation overaperiod offiveyears, during which theindustries werepartially responsible for
reforestation. Efforts werealsounder wayatthevillage andschool levels. Family planning wasa
priority ontheGovernment 'sagenda.
100. Counterfeit goods wereconfiscated anddestroyed. Allmanufacturing inCôted'Ivoire was
nowsubject tonational standards. However, counterfeit goods wereattractive tolowincome groups.Republic ofCôte d'Ivoire WT/TPR/M/2
Page 19
VII. CONCLUDING REMARKS OFTHE CHAIRMAN
101. Thisfirstmeeting oftheTrade Policy Review Body under theprocedures oftheWorld Trade
Organization hasenabled thetrade policies andpractices ofCôted'Ivoire tobereviewed forthefirst
time. Thefollowing remarks aremade onmyownresponsibility andarenotintended toreplace our
jointevaluation. Thediscussion focused onfourmain areas:
(a) Macroeconomic policy anddevelopments
102. Many participants noted thatthecompetitiveness oftheIvorian economy hadrevived following
thedevaluation oftheCFA franc andtheintroduction ofthestructural adjustment measures that
accompanied it.Thehighestimates ofGDP andinvestment growth mean maintaining strict control
overcurrent expenditure soastofinance public investment while avoiding inflationary pressure. In
thisconnection,theburdenofdebtservicinghasplacedanadditionalconstraintonbudgetaryexpenditure.
Theeffect oncompetitiveness ofrelatively highlabour costs wasraised.
103. Foreign direct investment isregarded asapre-requisite fortheanticipated growth. Inthis
regard, therecent reforms inprivatization, theintroduction ofanewlawoncompetition andtheframing
ofanewInvestment Code should allhelptoreinforce Côte d'Ivoire 'straditionally welcoming
environment forforeign capital andimprove competition between newinvestors andalready established
companies. Riskassessment isakeyfactor inthisprocess.
104. Several speakers alsostressed theimportance offinancial andtechnological external assistance.
105. Inreply, therepresentative ofCôted'Ivoire referred totheeconomic stabilization andrecovery
programme under waysince1991, which includes sectoral adjustment measures, thereform ofmonetary
andfiscal policy, alarge-scale privatization programme andtheintroduction ofanewInvestment Code.
Investment approval procedures havebeenmade considerably shorter andsimpler, andthis,together
withtheeconomic andpolitical stability ofthecountry, should reduce perceived risksandattract new
investment flows. Following devaluation, labour costshavebecome morecompetitive vis-à-vis similar
countries.
106. These adjustment efforts, combined withthechange intheparity oftheCFA franc, have
contributed tostabilizing theState'sfinancial position, reducing internal debt, restoring investor
confidence andincreasing thevolume ofexports.
(b) Trade performance
107. Many speakers referred toCôted'Ivoire 'simportant roleintheeconomy andtradeoftheregion.
Questions were putabout economic integration intheWest-African Economic andMonetary Union
(WAEMU) anditslinkwiththecommitments made within ECOWAS. Alluding totheimportance
ofspecial anddifferential treatment fordeveloping countries, some members noted theerosion of
preferential trade margins ofIvorian products initstraditional markets following theMarrakesh
Agreement. Inthiscontext, others stressed thatCôted'Ivoire should diversify itsproduction, turning
tonewnon-traditional goods andservices andnewmarkets.
108. Inreply, therepresentative ofCôted'Ivoire recalled thestrategy todiversify agricultural and
agro-industrial exports; theboom inthemining andenergy sector asaresult oftheexploitation of
newly-discovered petroleum, natural gasandother mineral deposits; andthedevelopment ofservices,
particularly inthesubregion, including financial services, telecommunications, transport andtourism.
Henoted thattheState nolonger intervenes orcontrols sources ofproduction intheindustrial or
agricultural sector, although ithadwarned thatatransition period wasnecessary inareassuchascoffeeWT/TPR/M/2 Trade Policy Review Mechanism
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orcocoa production where theworkers needorganizational help. With regard tothetreaty setting
uptheWAEMU, henoted thattheultimate objective istomake itacustoms union withacommon
external tariff andgreater internal cooperation. Aplanofwork forthevarious aspects ofsuch
cooperation istobeprepared before theendof1995.
(c) Trade regime
109. Participants congratulated Côted'Ivoire ona50percentreduction incustoms duties, which
nowstand atapproximately 22percent. However, thecomplexity andlackoftransparency ofimport
duties werenoted, andclarifications asked forconcerning themaintenance ofreference prices, alternate
duties andminimum levies, andtheneedtocumulate fourdifferent duties onmerchandise imports.
Members asked howtheGovernment planned toreduce budgetary dependence onimport duties. It
wasnoted thatthere wereveryfewbindings covering industrial products during theUruguay Round
andthatthevalue-added taxseemed toaffect imports more thandomestic products. Questions were
alsoasked about theapplication oftheCustoms Valuation Code.
110. Côted'Ivoire doesnotapparently discriminate against foreign suppliers asregards government
procurement. Inthisconnection, participants asked whether Côted'Ivoire planned toaccede tothe
newAgreement onGovernment Procurement.
111. With regard toexports, Côted'Ivoire wasasked byseveral participants toexplain therole
ofthecoffee andcocoa export taxes which haverecently beenreintroduced andwhich seem likely
toreduce bothexport volume andfarmers 'income. Generally speaking, thecumbersome administrative
procedures forexports seemed likely toimpair theperformance oftheexport sector. Some members
asked whether there wasdirect orindirect export subsidization.
112. Inreply, theCôted'Ivoire representative stressed theimportance ofsimplifying customs and
portprocedures forimportation andcustoms clearance, andofreducing andharmonizing duties and
taxes. Itwasnecessary tocreate amodern fiscal system andextend thetaxbase. Atariff reform has
established aconsolidated customs dutyof5percent; thefour-duty structure allows optimum
implementation ofCôte d'Ivoire 'seconomic andtrade policy andmakes harmonization ofcustoms
duties within theWAEMU possible. The VAT rateisthesame forimported asfor
domestically-producedgoods.InconformitywithWTOprovisions,Côted'Ivoirehasdelayedapplication
ofArticle 7ofGATT 1994forfiveyears. Riceandflourarenowimported without restriction. The
single export dutyoncoffee, cocoa andwood isassigned toboththegeneral financial budget andthe
Farmers 'Support Fund.
(d) Newareas
113. Intradeinservices, restrictions onshipping werereferred toasabarrier tothecompetitiveness
ofIvorian exports. Questions were alsoputabout theGovernment 'sobjectives withregard to
telecommunications, andfinancial andinsurance services. Since thelatter appear tobeparticularly
opentoforeign suppliers, doesCôted'Ivoire intend toparticipate innegotiations intheseareas? Energy
andwater supply services seem tobeestablished asprivate monopolies withregulated prices: what
mechanisms existtoprevent toohighprices from impairing thecompetitiveness ofIvorian exports
ofgoods andservices?
114. Measures relating totrade andenvironment areofvitalimportance fortheIvorian wood sector,
aswellasother rawmaterial exports, inviewoftheproblem ofdeforestation. Some participants asked
howtheGovernment planned tousetheproceeds ofexport taxes toremedy environmental problems.Republic ofCôte d'Ivoire WT/TPR/M/2
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115. With regard tointellectual property, Côted'Ivoire wasasked togivedetails ofthenature of
thepatent protection covering chemicals, pharmaceuticals andagricultural products.
116. Inreply,theCôted'IvoirerepresentativenotedthedissolutionoftheNationalShippingCompany
SITRAM andtheelimination oftheshippers 'visa,aswellasaplanfortheprivatization oftheNational
Telecommunications Company. Herecalled Côted'Ivoire 'saccession toseveral treaties andagreements
onintellectual property, including theBangui Agreement which applies toindustrial property, patent
rights andindustrial designs. Harmonization ofdomestic legislation withtheprovisions oftheTRIPs
Agreement must bepursued.
Conclusions
117. Members congratulated Côted'Ivoire onitspursuit ofmacroeconomic stabilization andtrade
liberalization, andnoted thepositive effects registered todate. They nonetheless encouraged
Côted'Ivoire tomake additional commitments andbindmoretariffs soastoensure thatcurrent reforms
continue. Participants expressed theirconviction thattheconsolidation ofreforms inthegoods and
services sectors would attract newinvestment andensure sustained economic growth.