- Côte d'Ivoire's economy upgraded to BB by S&P global due to consistent economic reforms
- Upgrade indicates less vulnerability in the near-term
- Côte d'Ivoire's commitment to cocoa exports and stable prices contributed to the upgrade
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Côte d'Ivoire’s economy has been upgraded to BB by S&P global following its consistent reforms targeted at stabilizing the economy. This upgrade comes amid Côte d'Ivoire’s commitment to its major export - the cocoa plant which has maintained high prices amid its huge demand.
Other contributors to Côte d'Ivoire's economic upgrade include the increased oil and gas output which will support exports, and the rapid narrowing of the country's elevated external deficit.
The report projects that by 2025, the budget deficit should reach 3% of GDP while the rising exports of the country's mining industry is expected to narrow the external deficit significantly.
S&P Global Inc (SPGI) provides financial intelligence solutions by offering credit ratings, benchmarks and data which classifies markets under the healthy or investment grade markets using designations like AAA, to BBB- and the speculative markets which range from grades BB+, to D.
With the recent upgrade, Côte d'Ivoire has been upgraded from its former rating, BB- which indicates a higher credit risk, to BB which indicates less vulnerability in the near-term.
The global credit rating company while giving reasons for the upgrade, mentioned the efforts by the region’s national bank, the Central Bank of West African States, from 2019-2024 in shoring up the economies and capital market access of member states during periods of repeated external shocks.
“Despite these shocks, Cote d'Ivoire has posted average GDP growth of over 5.6% from 2019-2024, with general government deficits moderating since the 2022 peak of 6.8% of GDP, reflecting progress on revenue mobilization and expenditure constraints under IMF programs”.
"The stable outlook balances risks from still-elevated external financing needs, high external leverage, and political uncertainty with the economy's solid growth prospects, strong donor support, and an expected decline in budgetary and external imbalances." the report stated.
Côte d'Ivoire is currently the world's highest producer of cocoa, the main ingredient in chocolate. Amid the product's high prices, and increased demand, the country accounted for a third of global cocoa production with 2.2 million tons of cocoa as at 2022.
Bloomberg reports that the west African nation’s cocoa harvest in 2024-2025 is projected to surpass previous estimates by 10%.
Recall Côte d'Ivoire in August this year, surpassed South Africa as the highest-rated nation in Sub-Saharan Africa with foreign debt outstanding.
According to Business Insider Africa, the S&P ratings in August this year, had placed Côte d'Ivoire in the BB- rating together with South Africa and while Côte d'Ivoire’s outlook was raised to positive due to an improving debt profile, South Africa’s outlook remained stable.
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