Economy and Business in Ivory Coast

The Ivory Coast is one of the most economically developed countries in Africa, with a significant modern sector, as well as a comprehensive agriculture.

From independence in 1960, the country has pursued a liberalist economic policy based on close association with the former colonial power of France, and has long attracted considerable foreign investment. Growth in the economy was particularly strong in the 1970s, and the Ivory Coast, among others by the World Bank, was highlighted as a model country for economic development in Africa. This situation changed in the 1980s, when falling prices for the country’s most important export products (especially coffee, cocoa ) in combination with high oil prices created significant problems.

The Plateau district of Abidjan, the central business district with the most important banks, taken from the Ebrie lagoon

The economic crisis, and the consequences of the accompanying economic structural adjustment program for most people, were a major cause of the political discontent that spread from the late 1980s – and which contributed to the political changes that took place. One of the main reasons for economic growth was political stability. When it weakened in the 1990s and the Ivory Coast was thrown into civil war in the early 2000s, it contributed to a significant deterioration of the economy. Despite a well-developed economy in many ways, there are major economic and social differences, and the war has contributed to the problem of poverty. According to the United Nations Development Program, 35 percent of the population lives below the poverty line (2015).

The country’s development strategy has been based on the development of agriculture aimed at production for export, with the result that the economy is thus very vulnerable to price fluctuations in the international markets. Cocoa and coffee have been the key export products for many years, grown mainly by small farmers.

The sales took place for many years through a state-owned company, Caisse de stabilization and de soutien des prix des produits agricoles (Caistab), which guaranteed the producers a fixed price, regardless of the current price on the world market. As long as these were high, the state benefited from the scheme, but with failing prices, Caistab incurred huge losses. The losses hit the entire economy, which was particularly the case in the late 1980s. From the 1991/1992 season, the state monopoly was abolished, and private players could participate as purchasers, leading to a price increase. Nouvelle Caistab was dissolved in 1999. After that it was decided to establish a coffee and cocoa exchange.

In 1994, the currency CFA, which is directly linked to the French franc through currency exchange with France, was devalued by 50 percent. This strengthened the country’s position in the export markets, especially for products such as timber, rubber and fish, but led to an increase in the price of imported goods. This, as well as a significant rise in prices for Ivory Coast’s leading export products, led to economic growth in the mid-1990s, leading to stagnation and decline as a result of political turmoil in 1998 and the subsequent civil war. Political instability has also hit the tourism sector, which was significant in the 1970s and 1980s.

Overview image of a village in Comoé National Park.

The Ivory Coast has a more complex economy than most African states, with a strong agricultural sector and a relatively diverse industry. A service industry in strong growth accounts for around half of the GNP ; agriculture for about a third, industry about a fifth. Much of the industry is rooted in the processing of agricultural products, and agriculture employs about half of the working population.

In recent years, the petroleum sector has become economically significant, with the extraction of oil and natural gas. While the gas is used mainly as energy locally, an excess of oil is produced for export, which in 2007-2008 became of greater economic importance than the traditional export products cocoa and coffee. In 1997, a regional exchange was opened in Abidjan. The African Development Bank (AfDB) established its headquarters in Abidjan in 1964, but due to the unrest this was temporarily moved to Tunisia in 2003. In 2014, the African Development Bank was able to return its headquarters to Abidjan.

After the end of the civil war, the economic growth of the Ivory Coast in the 2010s has been around 8 percent. Infrastructure development in and around the capital Abidjan, where about 20 per cent of the population lives, has continued with the construction of new bridges, a new container port, and the development of new power stations for the production of electric power.

However, the inequality between the poor and the rich is still a serious development problem.

Agriculture and fishing

Agriculture is traditionally the basis of the Ivory Coast’s economy, and 60-70 percent of the population is directly or indirectly involved in the sector. An agriculture aimed at the production of goods for export was established in the colonial period, and after independence was further developed into a pillar of the country’s economic policy – with continued emphasis on the production and export of tropical products. The versatile agricultural sector is dominated by small farmers, but with elements of plantation operations, and is largely dependent on migrant labor from neighboring countries, especially Burkina Faso. The use of labor migrants has been criticized in part because of poor working conditions.

New bridge at Abidjan

The Ivory Coast is mainly self-sufficient in food, and produces a variety of goods for export. Agriculture has traditionally accounted for around 75 per cent of export earnings, but the importance of the sector has diminished somewhat in recent years, partly as a result of the civil war and partly because the country has become an exporter of oil. The two most important products have for many years been cocoa and coffee, but in recent years much has also been invested in cotton, palm oil, copra and rubber, as well as fruit – especially pineapples and bananas, and nuts such as cashews.

Coffee was originally the most important product for turnover, but in the 1970s cocoa crops doubled, and in 1977 Ivory Coast became the world’s largest producer of cocoa beans. The production of cocoa is of great societal value also because it is essentially cultivated by small farmers, which thus ensures income opportunities. At the same time, the dependence on cocoa and coffee, as well as other export goods with strong price fluctuations in the international market, is an economic uncertainty factor, also because it takes up to three years from planting to harvest. Nevertheless, the authorities, together with the company Nestlé, are now investing in increasing investment and tripling coffee production by 2020.

Ever since the 1960s, the Ivory Coast has been one of the world’s leading producers of palm oil, and a great deal has been invested in the production of cotton and rubber. Much of the palm oil, and most of the cotton, is processed locally. In recent years, the authorities have placed greater emphasis on strengthening the production of food for local consumption. The country is normally self-sufficient, including maize, cassava and yams, while a significant portion of the consumed rice is imported. Areas previously used for sugar production have been converted into rice cultivation, and much of the rice imports can therefore be substituted for the country’s own production.

The Ivory Coast has a relatively small stock of livestock, substantially in the north, and local meat production accounts for only a third of consumption.

Around one-third of the Ivory Coast is wooded, and the country has significant areas of valuable timber. About 30 species are commercially mined. Forestry exerted timber for export, among other things, of mahogany, iroko, satin trees, African teak and other hardwoods, and sector yields significant export earnings. Before the Civil War, timber – both around and cut timber – was the country’s third most important export product, after cocoa and petroleum products. Harvesting has been intense since the 1960s, and the productive area fell from 15.6 million hectares in 1960 to about 1 million hectares in 1987, after which a forest planting program was implemented and timber harvesting was introduced.

The fishing industry is considerable, and fishing takes place extensively in lagoons and waterways, as well as offshore. Around two-thirds of the catch is taken offshore. Local fishing is dominated by small boats, and foreign interests account for a significant part of the catch. The commercial catch with trawlers has resulted in overfishing and lower quantities.

Mining and energy

The Ivory Coast has relatively versatile mineral deposits, but mining is not a significant part of the country’s economy. Diamonds are recovered from river deposits along Bou, a tributary to Bandama, but the recovery has declined since the 1970s. It is believed that the recovery is significantly higher than official figures indicate, due to illegal recovery and smuggling. A modest extraction of gold started at Ity in 1991, later new mines were opened. Other minerals and metals have also been discovered, including iron ore, nickel, bauxite and manganese.

In 1975, offshore oil discoveries were made. The first field, south of Grand Bassam, was put into production in 1980, but declined towards the end of the decade, when recovery from the two Bélier and Espoir fields was discontinued. New deposits were detected near Jacqueville and Grand-Lahou in 1994, and production in the Lion field began in 1995. Espoir was reactivated in 2002, for both oil and gas production – and with estimated reserves of 93 million barrels of oil and 180 billion cubic feet of gas. A new gas field, Foxtrot, was put into production in 1999. A new oil field, Baobab, was detected in the early 2000s, and is in operation.

Production of both oil and gas increased in the early 2000s, and in 2007 was approx. 52,000 barrels per day, which exceed national consumption, and provide a surplus for exports. Exports are mainly to Western Europe. As of 2007, oil exports represented around 28 per cent of the country’s export revenues, thus exceeding the two traditionally most important export items, coffee and cocoa. Ivory Coast’s proven oil reserves (as of 2008) were about 100 million barrels of oil and 1.1 trillion cubic feet of gas; essentially offshore.

The country’s power generation comes from a mix of hydropower plants and heat power plants. Hydropower has long been the dominant source of energy, but since extracted natural gas is increasingly being used for power generation, the proportion of hydropower plants in 2016 has been reduced to 32 per cent. Hydroelectric power stations have been developed by the River Bia, by the Kossou and Taabo ponds located along the Bandama River and by the Buyo dam along the Sassandra River. The Ivory Coast has long had surplus electricity, which has been exported through the West African power pool. In recent years, increasing electricity consumption in their own country has reduced this surplus.

The petroleum sector forms the basis for a chemical industry. There is oil refinery at Abidjan.


The Ivory Coast has a significant industrial sector on an African scale. The industry was little developed during the colonial period, when Senegal was the industrial center in French West Africa. After independence, rapid industrial expansion took place to reduce imports, while some companies established operations in Abidjan rather than Dakar. A new upswing in industrial travel occurred after the devaluation of CFA in 1994, when it became profitable to produce goods to replace imports. Much of the industry has been geared towards exports, based on the processing of the country’s agricultural products, especially cocoa, coffee, cotton,palm oil, pineapple and fish.

The industry is dominated by three industries: the food, lumber and textile industries. Most of the industry is concentrated to Abidjan and to Bouaké. Industrial growth slowed somewhat in the 1980s, and in the 1990s some of the state’s ownership interests in the industry were privatized. During the Civil War, industrial activity declined, as did other economic activity. The Norwegian company Yara has an import storage and mixing plant for mineral fertilizers at Abidjan.

Foreign Trade

Ivory Coast exports mainly consist of agricultural products, of which cocoa has by far the highest value, followed by timber and fish. From the early 2000s, petroleum products have become a major export item, accounting for over a quarter of the country’s export revenue. Cotton and fruit are other export goods, and the authorities are actively investing in increasing the export of coffee and cashew nuts. Some consumer goods are also exported from the industry.

The country normally has a trade surplus, as a result of a strong investment in export-oriented production. The trade balance was strengthened as a result of the CFA devaluation in 1994. The most important trading partner is France, while Germany, the Netherlands and the US are other important export markets. There is also a lot of trade with countries in the region, not least with Ghana and Nigeria, as well as with the land-based neighboring countries in the north. In addition, imports from countries such as China and Angola are increasing.

The Ivory Coast has traditionally had a significant tourism industry, targeting the French and Western European markets. This sector was severely damaged as a result of the diminished political stability of the 1990s and the subsequent civil war, but is now recovering.

Transport and Communications

The Ivory Coast has a well-developed transport sector on an African scale. A railway connects Abidjan with Ouagadougou in Burkina Faso, and is an important transport year for neighboring countries in the north – both for goods and passenger traffic. The road network is well developed and maintained with around 80,000 km, including the motorway between Abidjan and Yamoussoukro and a city bridge in Abidjan.

International airports are located in the Port-Bouët district of Abidjan, Bouaké and Yamoussoukro, and there are several regional airports. Air Ivoire was in charge of domestic air traffic until the company was suspended in 2011, while the multinational Air Afrique flew abroad until the bankruptcy in 2002. Today, Félix-Houphouët-Boigny International Airport is served by the newly launched local airline Air Côte d’Ivoire and by a number of regional, international, and intercontinental airlines.

Abidjan is the largest port city and is also an important port for neighboring Burkina Faso and Mali. The port experienced a major upswing following the opening of the Vridi Canal in 1950, which links the Ebrié Lagoon with the Atlantic Ocean. Significant renovations took place at the turn of the millennium, doubling capacity. A port in the city of San Pedro on the border with Liberia in the west has been established for export of timber, cocoa and coffee.