DEVELOPMENT BULLETIN-COTE D’IVOIRE: Market Forces Reign Supreme

By IPS Correspondents Reprint | | Print |

Melvis Dzisah

ABIDJAN, May 2 1998 (IPS) - Consumers in Cote d’Ivoire have been hit by a spate of food price hikes, but there is little they can do about it since the West African nation has no laws to protect them against speculators.

The increases have been blamed on factors like higher transport costs and poor rains, but whatever their causes, they have put severe pressure on poorer urban families like that of civil servant Marie-France Kouassi.

Kouassi is married with four children. The family’s monthly income, equivalent to about 220 U.S. dollars, was already small. It is even smaller now with the latest price hikes, which she felt deep in her pocket when she went to the market last week. At the top of her list were the three staples: yams, rice and cooking bananas.

First, she found that a kilo of yams had gone from 100 CFA francs the week before to 125 CFA. (The CFA exchanges at 602 to the U.S. dollar.) Then she discovered that the cheapest rice had jumped from 280 to 350 CFA per kg. But worse was to come: 350 CFA was no longer enough to buy a kilo of bananas. She now had to fork out 500 CFA for that.

In fact, prices have skyrocketed across the board. One kg of chicken (2,300 CFA) plus the same amount of tomatoes (900 CFA) now come up to more than a quarter of what many workers earn in a week.

The basic monthly wage in Cote d’Ivoire is about 45,000 CFA (roughly 75 U.S. dollars). However, a 1997 World Bank report titled ‘Poverty in Cote d’Ivoire’ estimates that many urban workers earn less than that, especially in the informal sector.

Annual inflation is officially estimated at 30 percent, but labour sources claim it might be more than 60 percent, with food prices among the fastest climbers. Traders blame higher transot costs. Transport owners say it’s because fuel is becoming more and more expensive. Farmers invoke last year’s poor rains.

“If, for example, yam has become expensive today, it is not our fault,” explains yam merchant Kouadwo Koumalo. “We are now paying 300,000 CFA for transporting 10 tonnes of yam from the farm gate to Abidjan as against 250,000 CFA franc last year because drivers say fuel prices have gone up.”

He also blames corrupt policemen on the highways for the price hikes: “At every checkpoint we are obliged to give the police 2,000 CFA francs, and we have for example 10 checkpoints between Bouna and Abidjan.”

However, observers attribute the inflationary trend more to the liberalisation of the domestic market under an on-going enhanced structural adjustment programme (ESAP) and a 50-percent devaluation in 1994 of the CFA franc, the common currency of former French colonies in Africa.

The government contends that ESAP has begun to bear fruit. Gross domestic product (GDP) grew by seven percent in 1997 and is expected to maintain that growth rate this year, according to Prime Minister Daniel Kablan Duncan.

But ESAP also saw the scrapping of a price regulation programme that had kept prices stable for a long period of time, and this left consumers all the more vulnerable to the increases that came after the devaluation.

Initially, the government attempted to cushion the effects of the devaluation by freezing the prices of 34 consumer items and increasing wages by 10 percent across the board. But the price freeze was shortlived. Faced with increasing import bills and decreasing revenue, the state scrapped it, leaving vulnerable groups at the mercy of the liberalised market.

“Every seller is fixing his or her own price at will, but no one is lifting a finger in protest,” complains housewife Cecile Aya. “We have a ministry of trade, but any time traders increase their prices, it becomes as silent as the cemetery.”

Aya thinks someone should do something before the situation gets out of hand. In other countries, consumer groups play that type of role, but Cote d’Ivoire’s consumer rights advocates say they can do little because they have no legal backing.

“Since 1994, we sent a proposal to the National Assembly to give us legal status, but so far nothing has been done,” explains Mel Theodore, president of the Consumer Protection Association of Cote d’Ivoire. “Until we have such legal backing we cannot take action as consumers are demanding.”

Moreover, there are no laws which protect consumers against speculation in the West African Republic whose people are among the world’s poorest, despite the economic upswing touted by the government. According to a 1994 study by French researchers, 95 percent of Cote d’Ivoire’s wealth is in the hands of less than three percent of the population.

Asked this week what he thought of the country’s economic indicators, Pierre Van Den Boogaerde, the International Monetary Fund’s representative in Abidjan said: “While the GDP estimates are real, the social indicators are in the red.”