Ivory Coast seeks to assure Eurobond holders
WASHINGTON (Reuters) - Ivory Coast will resume regular repayments on its defaulted $2.3 billion Eurobond next year and will seek a formula to make good on missed coupon payments, Finance Minister Charles Koffi Diby said on Saturday.
The minister, who was in Washington attending IMF/World bank meetings, stressed that the world's top cocoa grower intended to honor its debt obligations as it worked to get its economy back on course after a post-election conflict.
The Eurobond, which matures in 2032, was launched in April last year to repackage defaulted Brady bond debt. It itself went into default due to a brief civil war this year triggered by a disputed November election.
"We're going to resume the current payments as contracted in 2012, but at the same time you have to take account of our payment capacity ... because we won't be able to pay at the same time our arrears and our regular due payments," Diby told Reuters in an interview.
He said Ivory Coast would be talking with bondholders about a "platform" to handle repaying the coupons missed this year, but he stressed this would not imply any restructuring.
"It's not a question of Ivory Coast renouncing its obligations, nothing like that," he said, seeking to reassure investors and creditors over the defaulted debt.
Repayment of commercial creditors would follow the resumption of an interrupted program with the IMF, an initiative which Diby said would also involve reforms of the country's cocoa and electricity sectors, and also efforts to improve the overall investment climate.
He promised heightened transparency in the government's management of the economy and development assistance. "The books are open, all the world will be able to see," he said.
The post-election fighting, which killed 3,000 people and pushed the Ivorian economy into a sharp contraction, broke out after former President Laurent Gbagbo refused to accept the outcome of the polls, which were won by his rival Alassane Ouattara according to U.N.-certified results.
Ouattara, who says he wants to restore his West African country to the position of prestige in the region it once enjoyed 20 years ago, told Reuters in New York on Saturday his country could increase its cocoa output to half of the world's production.
Ivory Coast currently supplies around 40 percent of the world's cocoa demand.
Ouattara said in Washington on Friday that the planned overhaul of the cocoa sector was being undertaken as part of the debt relief program to be resumed with the IMF and World Bank and would liberalize the sector.
Finance minister Diby said the reform would seek to make the sector "simpler, more transparent and more efficient".
The cocoa sector improvements, due to be unveiled by the end of October, would look to channel more revenues to Ivorian cocoa growers and also to give a good return to investors and exporters in the cocoa sector, the minister said.
Diby said he believed the international financial community and creditors were ready to show understanding toward Ivory Coast, which is experiencing a better-than-expected economic rebound after the violence that set back the country.
Revising upward its previous estimates, the IMF said last week the West African state's economy would grow 8 to 9 percent in 2012 after shrinking 5.8 percent in 2011.
One encouraging factor was a record cocoa crop of more than 1.4 million tons this season thanks to good growing weather.
Diby said growth was expected to remain robust at 6 percent in 2013 and the same the year after that.
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