March 15, 2012 / 5:53 AM / in 6 years

Ivory Coast GDP growth to hit 8 pct in 2012: IMF

ABIDJAN (Reuters) - Ivory Coast’s economy will grow 8 percent in 2012 after contracting 5.1 percent in 2011, on stronger-than-expected post-conflict recovery, the International Monetary Fund said on Wednesday after meeting with Ivorian authorities.

Workers prepare to load sacks of cocoa onto a ship at the port of Abidjan May 8, 2011. REUTERS /Luc Gnago

The IMF also said the world’s top cocoa-growing nation has made progress in reforming its cocoa sector, a key condition which would enable it unlock debt relief under the IMF-World Bank Heavily Indebted Poor Country (HIPC) scheme by June.

“The rate of economic growth for 2012 will be 8 percent and inflation below 2 percent,” IMF mission chief in Ivory Coast Doris Ross told journalists after the meeting.

”The economic recovery is stronger than expected and we are pleased with the efforts made in the reform of the cocoa sector,

and mission appreciates the execution of the 2011 budget and revenue growth in 2012,” Ross said.

Ross confirmed the World Bank’s view, which said in February that the reform of the cocoa sector, meant to provide farmers with a minimum price for their produce, was on track.

“Ivorian authorities have made considerable efforts and could benefit from a substantial debt reduction through the HIPC in June,” Ross said.

Emerging markets strategist at Standard Bank Samir Gadio said the IMF’s suggestion that the HIPC completion point could be reached by June was good news because the market had factored in the possibility of a delay over the reforms which have not been fully implemented.

He added that the good news, as well as the smooth power shift in the country with the appointment of a new prime minister, contributes to making “the upward price trend of the Ivorian Eurobond ... virtually self-fulfilling.”

Ivory Coast has said it will come up with a schedule to quickly reimburse arrears on its 2032 $2.3 billion bond, which went into default after a post-election crisis, once the IMF-backed debt relief was certain.

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