Friday, December 24, 2010

Elections and Financial Pressure in Ivory Coast

Bloomberg: West African Bank Gives Vote Winner Ouattara Access to Reserves, AFP Says
Reuters: Dutch Warship Heads to Ivory Coast to Help French
Times Live: West African Bank Freezes Out Gbagbo
WSJ: World Bank Freezes Ivory Coast Financing

The November 28th elections in Ivory Coast sparked a wide array of human rights abuses, the most notable of which is the death of at least 173 people between December 16th and 21st. Former President Laurent Gbagbo lost to Alassane Ouattara and has refused to relinquish power, sparking riots across the country and international condemnation. Gbagbo’s allies in the Constitutional Court destroyed hundreds of thousands of votes for Ouattara, and Gbagbo has control of the military, making it nearly impossible to forcibly depose him absent international help. This election was supposed to unite the country, which is still recovering from the 2002-3 civil war, but has led to disorder.

International financial organizations have taken action to dismantle his finances. The World Bank, the African Development Bank, Economic Community of West African States, and the African Union have all stated Gbagbo needs to step down. The World Bank has frozen $841.9 in financing to Ivory Coast, meaning Gbagbo will struggle to pay his troops and previous debt. The World Bank’s action caused Ivory Coast’s $2.3 billion bond due in 2032 to fall to a record low on Thursday because investors worried Ivory Coast would be unable to meet a $30 million bond payment due Dec. 31.

African financial institutions have also taken action. The Central Bank of West African States recognized Ouattarra as President and gave him control of state reserves. The seven finance ministers of the West African Monetary Union all endorsed Ouattara.

Despite international pressure, financial and moral, Gbagbo has shown no signs of stepping down. The French even asked for, and received, assistance from a Dutch warship, the Amsterdam, to provide logistical support to possibly evacuate European citizens if violence worsens. Gun battles have occurred between government soldiers and those backing Outtarra, and masked gunmen have kidnapped residents of pro-Outtarra neighborhoods from their homes at night. The U.S. State Department was considering strengthening the 10,000 strong U.N. peacekeeping mission in conjunction with France and African states to make Gbagbo’s military options less appealing. However, the French Minister in Charge of Cooperation said the African states must lead any direct effort to oust Gbagbo.

1. Should the World Bank be so involved in Ivory Coast’s domestic politics?
2. If the situation devolves such that military action is necessary, will the African Union be able to depose Gbagbo?
3. What effects does Ivory Coast’s instability have on neighboring countries?

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