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Ivory Coast Says Will Overhaul Cocoa Sector

Source: Reuters
11/09/2008

Abidjan, Sept 11 - Ivory Coast will replace all bodies administering its key cocoa sector by September 15 with a temporary body until widespread reforms are complete, a government official said on Thursday.

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The West African country is the world's biggest cocoa producer, but as world prices have risen to their highest in decades, the industry has been beset by allegations of corruption, and a strike which threatens to disrupt exports.

"The new set-up will be one organisation that takes over the jobs of ... all the bodies that were born from the 2000 reform," Marie-Louise Acquah, natural resources advisor to the prime minister, told Reuters.

Cocoa is a pillar of the Ivorian economy. It represents 20 percent of its GDP and 40 percent of export income, and has become a major issue in an election year.

A much-delayed presidential vote, intended to draw a line under a 2002/03 war that split the country, is due on Nov. 30, but analysts say it is likely to be further postponed.

Acquah gave no details on the likely form of the new administrative body, but said it would mean lower taxes on cocoa, and greater transparency.

"We should have a single tax of 4.5 CFA francs ($0.009) per kg instead of the multiple taxes that we have now," she said, putting current taxes at 10.65 CFA francs per kg.

The temporary administrative structure, which will replace the five bodies that currently govern the sector, will operate for at least one season while longer-term reforms are carried out, Acquah said.

"We must find a broader solution which allows for greater visibility in the sector," she said.

Exporters gave the proposed reforms a cautious welcome, though stressed that several pledges of reorganisation had been made in the past and not come to fruition.

"I think the merging of the structures into one would reduce the delay in securing export documents. I think this would simplify things," said one exporter.

Just weeks ahead of the new cocoa season, registration of cocoa intended for export has been paralysed by a strike at the Coffee and Cocoa Bourse BCC marketing body over unpaid salaries, and by in-fighting for senior positions vacated by executives arrested for corruption.

President Laurent Gbagbo ordered the investigation into misuse of money at the BCC, and has promised jail terms for those found guilty.

The Ivorian cocoa sector has been plagued by corruption since it was liberalised in 2000, officials and diplomats say.



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