The following piece (pasted below) will be published in The Wall Street Journal (Europe) either on Wednesday or Thursday (Dec 29 or 30). They will of course edit it substantially. Cheers, Madiba. ---------------- IVORIAN MIRACLE SHATTERED George B.N. Ayittey, Ph.D. Robert B. Myers, Ph.D. Like Indonesia, Ivory Coast was for decades held up as an "economic success story" and a bastion of stability by the World Bank, the IMF and international donors. The December 24 coup has shattered not only the myth of an Ivorian "miracle" but also Africa’s hopes for a new beginning in the new millennium. The impromptu coup began with a mutiny of soldiers from an Abidjan-based unit over unpaid wages for their unit’s service in a U.N. peacekeeping mission in the Central African Republic. [Similar grievances of returning soldiers from peacekeeping duties in Liberia led to the ouster of General Joseph Momoh of Sierra Leone in April 1992 and Sir Dawda Jawara of The Gambia in May 1994.] Rampaging soldiers, looting stores and seizing cars in Abidjain, discovered to their surprise much deeper popular discontent with the ousted regime of Henri Konan Bedie. Capitalizing upon this, they called upon former army chief of staff, General Robert Guei, to take over the government. The U.S., South Africa, Nigeria and other African countries condemned the coup and requested speedy restoration of what they considered to have been a democracy. However, like the recent coup in Pakistan, most analysts are caught between a rock and a hard place. The ousted civilian government of Henri Konan Bedie, like that of Nawar Sharif of Pakistan, was nobody’s angel - even in his own inner circle. Ivorians jubilated at the news of his ouster but the real story lies elsewhere. Decades of fawning World Bank patronage and eccentric French paternalism transformed Ivory Coast into an accident waiting to happen. Upon independence from France in 1960, the late Felix Houphouet-Boigny, known as Le Vieux, assumed power and ruled for 30 years until November 1990. Like other Francophone African countries such as Cameroon, Senegal and Togo, Ivory Coast has had only two heads of state in 39 years. France tolerated high-level corruption and autocratic regimes in its former African colonies. Ivory Coast was a one-party state and the Partie Democratique de Cote d'Ivoire (PDCI), the sole legal party, which has ruled since 1960. Houphouet-Boigny proscribed opposition parties with the constant refrain "that his life was under threat from opposition figures working in collusion with juju-men and their gris-gris" (West Africa, July 13-19, 1992; p.1171). He took responsibility for all policy decisions, saying "There is no number two, three or four . . . in Cote d'Ivoire there is only a number one: that's me and I don't share my decisions" (West Africa, Aug 8, 1988; p. 1428). The press was tightly controlled by the government and faithfully reflected the party line. All civil servants were party members. Houphouet-Boigny once described this economic philosophy as "state capitalism" but it transmogrified into "crony capitalism." Many of his associates enriched themselves fabulously under his watchful patronage. In the 1970s, Henri Bedie, the Minister for the Economy and Finance was dismissed for embezzlement and fled the country, later to become the Charges d’Affaires of the Ivorian Embassy in Washington, DC. "Rehabilitated," he returned to become the Chairman of the National Assembly. His name resurfaced in a number of financial scandals that rocked the country in the 1980s, regarding his ill-fated plans to expand the country’s sugar industry. Another Houphouet-Boigny associate, Emmanuel Dioulo, the former mayor of Abidjan, fled to Europe in March 1985 to avoid criminal charges of embezzlement and fraud. His company, COGEXIM, "had failed to repay loans worth $58 million to the Banque Nationale de Development" (West Africa, May 1-7, 1989; p. 677). He received a Presidential pardon and indemnity from prosecution upon his return to the country on March 3, 1986. In April 1989 Dr. Theodore Kouba, another executive member of the ruling Partie Democratique de Cote d'Ivoire (PDCI), was charged with extorting CFA 6.8 billion ($21.8 million) from executives working for the Abidjan-based Continental Bank, the African Development Bank, the World Bank, and from some 800 Ivorian teachers under the pretext of building estate houses for them. In 1983 Houphouet-Boigny himself stunned the nation by declaring on television that: "Yes, I do have assets abroad. But they are not assets belonging to Cote d'Ivoire. What sensible man does not keep his assets in Switzerland, the whole world's bank? I would be crazy to sacrifice my children's future in this crazy country without thinking of their future" (La Croix, Paris, March 13, 1990). In the Guardian Weekly (London) Paul Webster claimed that Houphouet-Boigny "was siphoning off French aid funds to amass a personal fortune as high as 6 billion pounds sterling" (June 17, 1990; p. 9). Ivory Coast’s economic development strategy, supported with massive infusion of World Bank loans and French aid, was based the extraction of large surpluses from small-holders (peasant farmers) - for example, through 40% or higher taxes on cocoa -- for investment by the state. In his 1988 New Year’s address to the nation, Houphouet-Boigny admitted that the country's farmers had over the years parted with four-fifths of the value of what they produced to enable the government to finance economic development. But the sums were channeled into unwieldy and unprofitable state corporations and the development that took place over 80 percent -- was concentrated in Abidjan and other urban areas, bypassing the rural peasants. The president's proteges used the rest of the peasants' money for self-enrichment and deposit overseas. In 1990, the central bank calculated that some CFA 130 billion [or $456 million] are spirited out of the country illegally each year" (Africa Report, May-June, 1990; p. 14). To be sure, in the 1960s and 1970s the Ivory Coast did enjoy robust economic growth, averaging 6 percent annually -- one of the highest growth rates in Africa - earning praise from the World Bank and other international donors. However, the windfall earnings from cocoa and coffee in 1976 and 1977 were splurged on imports and the country borrowed recklessly to finance a consumption binge. Its foreign debt soared from $1.66 billion in 1975 to $8.45 in 1987 and $14 billion in 1988 for a country of 16 million people. An economic crisis emerged in 1979, debts were rescheduled and a structural adjustment agreement signed with the IMF and the World Bank in 1981. An initial success, with GDP growth registering 5 percent in 1985, led the World Bank and the IMF to throw all caution to the wind. A hasty 1985 IMF report, ignoring all signs of social discontent, huge disparities in income and lack institutional infrastructure, was effusive in its praise, declaring Ivory Coast "a success story" - a model of free market success. Imaginative World Bank lending entrepreneurs, including, among others, Ismail Serageldin, a current director of the Bank, presented a carefully contrived but glowing portrait of a country reaching a series of new policy adjustment milestones. Each was accompanied by a new multi-million dollar policy-based loan, totaling about $2 billion over a four-year period. The loan was disbursed on "hard" IBRD terms so as to avoid country lending limitations implicit in the much more concessional IDA lending. But the collusion also permitted the Bank to be duped. In point of fact, and as was widely known, little policy adjustment was occurring. This, coupled with the rapid increase and onerous terms of public sector external borrowing, caused an increasingly serious external debt crisis. Thus, World Bank loans essentially supported a socialist and interventionist government and an enormously over-valued exchange rate, despite the rationalizations by Bank officials to outsiders that the loans were to mitigate the effects of the exchange rate and stimulate private enterprise. Falling commodity prices and scandalous mismanagement brought the crisis back in 1988. GDP growth turned negative (-6.4 percent) with an income per capita of $830, down 36 percent from $1,290 in 1978. Blaming the declining market on Western commodity speculators, President Houphouet-Boigny asked all public sector employees, students, and teachers for a "solidarity tax" --cuts in wages and allowances, 40 percent for civil servants. The official price paid to cocoa and coffee producers was reduced by 50 percent for the 1989 to 1990 growing season. These measures provoked unrest and riots amid calls for political reform. Viewing the vast basilica Houphouet-Boigny was building for himself at Yamassoukrou at the cost of $360 million and taking a cue from the dramatic developments in Eastern Europe, the workers opposed the tax. They took to the streets in February and March 1990 to vent their anger at the government. They dismissed his argument that Western commodity speculators were responsible for the collapse of the markets and demanded his resignation, pointing to the basilica as a paramount example of his failed leadership. Irate workers demanded the prosecution of the grotos (the corrupt ruling elite) accusing Houphouet-Boigny and some of his powerful government ministers of having hidden away in Europe sums said to exceed the foreign aid that Western donors have poured into Ivory Coast" (The Washington Post, March 26, 1990; p. A17). When Houphouet-Boigny insisted that there were no billionaires in the Ivory Coast, a tract revealed that Minister of Primary Education Odette Kouame, appointed in 1985, owned a castle on Boulevard Latrille in Cocody and another in her own village. Houphouet-Boigny steadfastly rejected the protesters' demands for multiparty democracy, claiming "tribalism was still the main obstacle to the achievement of national unity--the prerequisite for a change in the status quo" (Africa Report, May-June 1990; p. 16) and unleashed his security forces on the protestors with tear gas, stun grenades, and truncheons. Schools were closed and 120 teachers were arrested (West Africa, April 2-8, 1990; p. 558). By May 1990, the Ivorian "miracle" was over. The country’s 13 bishops issued a pastoral letter, deriding it as the "Ivorian malaise" (West Africa, Aug 6-12, 1990; p. 2251). Mounting pressure--through strikes and demonstrations-- forced Houphouet-Boigny to legalize other political parties and to hold multiparty elections in November 1990. But Houphouet-Boigny handily won a seventh term in a presidential election generally regarded to have been rigged. Social discontent against the corrupt ruling oligarchs bubbled to the surface again in 1992 when angry citizens took to the streets to protest hopeless life in perpetual poverty. University students boycotted end of year examinations to protest the government's new education policy, which required them to pay higher bus fares. Unemployed youth also went on the rampage, blocking mid-day rush hour traffic. Producers of the country’s cash crops joined in. Years of neglect by the government had left them bitter. Apart from good access roads, every other social service is in short supply. At an October 1992 meeting at Anyama, on the outskirts of Abidjan, the farmers demanded better prices for their produce. Again this year, the farmers renewed their demands, refused to sell their cocoa and burned several tons to protest low prices. In 1993, Houphouet-Boigny passed away and immediately power-hungry stalwarts within the ruling PDCI party could not even wait for his burial before jostling ferociously to succeed him. Said a desperate Philippe Yace, a challenger: "I would be happy to become president, even if just for two weeks" (New African, May 1994, 41). Ordinarily, the prime minister, Alassane Outtara, should have taken over but he was outmaneuvered by Henri Konan Bedie, the Speaker of the parliament. Bedie, who hails from the same ethnic group as Houphouet-Boigny (Bauole), assumed full control but departed from Houphouet’s style of governance: dialogue and consensus. In 1994, Bedie launched a highly xenophobic and ethnically divisive campaign of "Ivoirite" -- Ivorian-ness -- ostensibly to check the influx of foreigners. But opposition leaders said the campaign was to promote his Baoule ethnic group and Ouattara, a Muslim for the north, from ever becoming president. "After 1994, after Ouattara left, all [Muslim] northerners lost important jobs," said sociologist Abdou Toure. "I was fired from UNESCO, Ali Coulibaly was fired as main television broadcaster, General Abdoulaye Coulibaly was fired as air force commander. We were replaced by Baoules," Mr. Toure said (The Washington Times, October 10, 1996, A17). Many African immigrants, notably from neighboring Burkina Faso and Ghana, were harassed and forced to leave. For the presidential elections in 1995, Bedie rammed through parliament an electoral code designed to ensure his victory and changed the president’s term of office from 5 to 7 years to lengthen his stay in office. Protests led to violent clashes with security personnel on 16 October 1995, and five lives were lost. "Only a politician like Bedie could have made such a mess of things," said an irate World Bank official. "Only he could have turned an economic success story into a political nightmare that this is turning out to be" (The Washington Times, 19 October 1995, A14). Crony capitalism continued unabated. In May, the French Weekly published the fortunes of African heads of state, placing that of the late President Houphouet-Boigny’s fortune at 35 billion FF (or $6 billion) and clocking President Henri Bedie’s at 2 billion FF (or $300 million). [Reprinted in the Nigerian newspaper, The News (Aug 17, 1998). Companies with links to President Konan Bedie's family grew fat in financial services and commodity trading, while others gobbled up the most profitable privatized state companies. In June, 1999, the EU suspended aid to Ivory Coast after discovering that about $30m donated for health programs had apparently been embezzled through dubious accounting, over-billing, and failure to deliver goods. One example was baby weighing scales, which would normally cost about $40 and was billed by the health ministry as costing $2,445. Subsequently in July, Communications Minister Daniele Boni Claverie revealed that four senior government officials of the Health Ministry were held for questioning. In August 1999 Ouattara was proclaimed leader and presidential candidate of the Assembly of Republicans (RDR), a breakaway group from the ruling party. Bedie grew nervous and panicky. On Nov 12th, 1999, 11 leading members of RDR, including 4 members of parliament were jailed for two years for allowing others to cause public disorder. Nine more were charged with public order offenses. On Nov 26th, the police sealed whole areas of Abidjan and arrested 8 more leaders of the RDR in a northern town. The crackdown further widened ethnic and religious divisions, leading to events that culminated in the coup. The jubilation was not only a rebellion against appalling socio-economic conditions and the tyrannical excesses of the Bedie regime but also a sharp rebuke of French and World Bank policies in the Ivory Coast. France did not equate decolonization with retreat. France left hundreds of officials in Africa as advisers. Behind the doors of many key ministries in the Ivory Coast and Senegal or Gabon, discreet but powerful French officials kept a close eye on policy. France created a sister franc CFA (Communaute Financiere Africain) for the former French colonies in 1948 with its valued pegged at 50 CFA to 1 French franc until 1994 when it was devalued to 100 CFA to I FF. A Department of Cooperation was set up to provide them with financial aid, tariff concessions, and support for their currencies. The department had an African aid budget five times greater than that of Britain. In 1988, for example, France spent $2,591 million in aid to Africa; Britain spent $516 million. More than half of French foreign aid went to Africa, making France the continent's foremost patron. In 1993, France's budget for overseas aid was $7.9 billion. The French also sent teachers to Africa and brought African students and civil servants to France for training. In fact, in 1993, there were more French citizens -- about 100,000 -- in post-colonial Africa than at independence (The New York Times, Feb 23, 1994; p.A6). At the time of the coup, there were more than 20,000 French citizens in the Ivory Coast. A 1975 government survey found 80 percent of all secondary school teachers in Ivory Coast to be French, who also formed 65 percent of the top managerial personnel in all of Ivorian enterprises. The real intention of the French was to protect their vast economic interests and gain access to Africa's minerals. Twenty percent of France's oil came from West Africa. The Ivory Coast, for example, buys 40 percent of its imports from France and the French own a third of the country's manufacturing industries. Since 1960, France has intervened on many occasions to prop up unpopular African regimes against internal dissatisfaction. The most notorious such occasion was in Gabon in 1964, when French troops were used to reinstate President Mba after a coup. Noting that the French did not intervene to save President Youlou in Congo-Brazzaville in 1963, critics charged that intervention was predicated on mineral wealth. (Gabon is rich in oil.) Significantly, the French who have 550 troops stationed in the Ivory Coast did not intervene in the Dec 24 coup but only sent in additional 40 men to protect its citizens. Gen. Guie warned France to abandon any "hidden agenda" of restoring Bedie to power and to take him out of the country. Nor has the IMF director, Michael Camdessus, flown to the Ivory Coast to defuse the crisis, as he did on July 31, 1992 to save "its star pupil" in the wake of mass demonstrations in Abidjan. General Robert Guei has vowed "to create the necessary conditions for a real democracy with a view to holding fair and transparent elections." But West Africans have heard this many times before. Coup makers who made such promises subsequently shed their uniforms and donned civilian clothes to win presidential elections. Ten out of the fifteen West African countries are ruled by military-despot-turned-civilian president. Ivory Coast, the World Bank’s success story, may join this club. No military regime has brought lasting prosperity to any African nation. The real solution to the Ivorian "malaise" lies not in the provision of more World Bank loans but in the convocation of a "sovereign national conference," where representatives of the political parties, the Churches, trade unions and other sections of civil society hammer out the country’s political future - as happened in Benin in 1991 and South Africa in 1993. It is an indigenous African solution. _______________________ Mr. Ayittey is an Associate Professor of Economics at American University and President of The Free Africa Foundation, both in Washington, DC. Mr. Myers is a former Principal Economist with the World Bank in Washington, DC. ---------------------------------------------------------------------------- To unsubscribe/subscribe or view archives of postings, go to the Gambia-L Web interface at: http://maelstrom.stjohns.edu/archives/gambia-l.html ----------------------------------------------------------------------------