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Facing increasingly tough international competition in coffee and cocoa markets, Côte d'Ivoire can increase export revenues from the two commodities 8 percent in 1995 and about 12 percent in 2000 by increasing coffee production and cutting back on the expansion in cocoa production.
This paper is concerned with two related questions, first, what determines coffee and cocoa yields, and second, how should the government determine the farmgate prices for the two crops. Section 1 of the paper is a preliminary analysis of the agricultural data from the Living Standard Survey. Section 2 looks at cocoa and coffee yields and their determinants. It examines the age/yield relationships and the apparent effects of fertilizer and pesticide use on yields. ALso examined are a range of other factors that might play a role in determining yields, for example, prices of other crops, wage rates, household size, and educational levels. Section 3 turns to distributional issues involved in the pricing of cocoa and coffee. Typical budgets for farmers are presented, and their position in the income and consumption distribution descibed. Section 4 concerns itself with the analysis of policy change, and speculates on what might be the effects of moving towards the policy of allowing domestic prices to be determined by world prices. Finally, section 5 summarizes the major policy conclusions and outlines areas where further research is likely to be useful in improving policy advice.
The end of the twentieth century, which was marked by multiparty democracy in Eastern European entities and Third World countries, moved Cte dIvoire to adhere to the new democratization system in 1990. Nine years later, the territory registered its first bloodless state coup. On September 19, 2002, the country was shared into two parts with human losses and damages when President Gbagbo was on official visit to Italy. After different attempts in negotiations (Linas-Marcoussis (2003), Pretoria agreement (2005), and the Political Agreement of Ouagadougou (2007)), for some protagonists, international organizations and NGOs, the perfect conflict resolution was about running elections so that the former peaceful land could regain its image of a prosperous and stable country. The elections that were delayed six times came to pass, and two presidents came out of the scrutiny. Gbagbo was proclaimed victorious by the Ivorian Constitutional Council, while Ouattara was acknowledged by the Independent Electoral Commission. Once more, the country fell into a postelection crisis. Meanwhile, the African Union, the European Union, the USA, the French Licorne, and the United Nations urged President Gbagbo to step down since Ouattara was considered the happy winner of the scrutiny. The refusal of Gbagbo cost human losses and led to his arrest on April 11, 2011. Nowadays, the country is not unified and reconciled, but it will have the 2015 elections.
Abstract: Key economic variables in Cote d'Ivoire vary widely from their long-run trends, moving in multi-year cyclical patterns. Cocoa prices move with cycles in growth rates, capital stock, real exchange rates, terms of trade, cocoa production, and coffee production and output. These patterns have become more pronounced since the 1970s as volatility increased. This paper characterize these cycles, estimates the cocoa price-quantity relationship, and analyzes co-movements due to shocks generate a forecast. Three key conclusions follow. First, the economy of Cote d'Ivoire has experienced two fundamental transitions, one in 1976 related to cocoa, and another in 1994 related to exchange rates. From 1960 to 1976, world cocoa prices grew steadily, and then fell in real terms. The country's growth showed a similar pattern. An econometric model indicates that the relationship between cocoa price and quantity experienced a break in 1976 and provides evidence of Cote d'Ivoire's significant influence on world cocoa prices. Second, cocoa price shocks affect growth rates and trade indicators, and are important sources of volatility in the Cote d'Ivoire. The terms of trade and real exchange rate are also sources of volatility for growth and productivity. Third, a forecast of per-worker output based on these variables predicts continued declines in GDP per worker in Cote d'Ivoire for the near future. This dismal forecast implies the need for a radical and rapid improvement on political, security, and economic management to reverse the two and a half decades of economic decline.