Côte d'Ivoire: Vulnerable households and small businesses find relief from government program to ease Covid-19 headaches
The program’s main objectives were to extend cash transfers to more than 117,000 newly vulnerable households at a cost of 75,000 CFA francs each
Côte d'Ivoire has benefited from financial support from the African Development Bank, whose Board of Directors last June approved a loan of €75 million
For Hortense Koné, the manager of a small restaurant in Abobo Belleville, north of Côte d'Ivoire’s economic capital Abidjan, paying her water and electricity bills became a headache last year when Covid-19 lockdown restrictions hit her business.
But a decision by the Ivorian government to cover water and electricity bills for households in the lower income brackets has finally brought her some relief.
“With the lockdown, the curfew and the ban on opening bars and nightclubs to counter coronavirus, frankly, I had no more income. So, nothing to survive on in this situation. I couldn’t pay my water and electricity bills,” recalls Hortense. “When the state announced its decision to pay for me, it took a big thorn out of my side.”
Stanislas Kouassi, a cabinet maker in Attecoubé, in the Abidjan district, has a card-reading electricity meter. “Thanks to the social program set up during the pandemic, I received a recharge of 5,000 CFA francs (€7.6 euros), or 63 kWh of energy,” he said. “This gave me continuous electricity for two months...The program has really helped me.”
Hortense and Stanislas are among the many beneficiaries of a social program implemented by the government in Côte d'Ivoire to cushion the population from the effects of the health crisis and strengthen the resilience of the economy. Côte d'Ivoire has benefited from financial support from the African Development Bank, whose Board of Directors last June approved a loan of €75 million in the form of budgetary support as part of the Covid-19 response support program.
At the beginning of the coronavirus crisis, few people really believed in its existence on the streets of Abidjan and in the interior of the country. Even after the first case was recorded on 11 March 2020, residents did not adopt precautionary health measures. But eventually, a jump in the number of infected people forced the government to declare a state of health emergency and adopt drastic measures. These included introducing a curfew, isolating Abidjan from the interior, compulsory mask wearing on public transport and closing nightclubs and bars.
These measures disrupted the daily lives of Ivorians. Students were forced to take holidays, while workers were asked either to work at home or to work part-time. Large companies as well as small and medium-sized enterprises were no longer working at full capacity. When the burden of costs became concerning, the state intervened to support entrepreneurs and low-income earners, helped by funding from the Bank.
“The budget support was fully disbursed in August 2020 and has helped control the spread of the pandemic through effectively implementing the health response. The social and economic effects have been mitigated by using various support funds for poor households and the private sector,” says Amadou Ibrahim, senior governance officer at the African Development Bank, in charge of the project.
Amara Kanté, a rice trader and semi-wholesaler in the same neighbourhood of Attecoubé, was worried about paying salaries and taxes because of the Covid-19-related slowdown of his business. “My concern was how to pay the taxes and salaries of my two employees and other expenses when orders had dropped sharply. The assistance from the state was helpful...but I think it can still do more,” says Amara.
The program’s main objectives were to extend cash transfers to more than 117,000 newly vulnerable households at a cost of 75,000 CFA francs each (about €114), to cover water and electricity bills of one million households – or 40% of electricity subscribers – and to feed two million children with dry food rations to the end of 2020.
The development objective of the Bank’s support was to foster the conditions for a rapid economic recovery from the health crisis by maintaining the production capacity of at least 90% of the country’s small and medium-sized enterprises and providing tax relief to 3,500 businesses.
Côte d'Ivoire’s government thus suspended, for three months, taxes on profits, the payment of patent fees, the synthetic insurance tax for consumers, the employers’ contribution, flat-rate taxes for small traders and craftsmen, taxes on debt income and taxes in the tourism industry.
Similarly, general accounting controls and unannounced spot checks were suspended for three months for both tax and customs purposes. For companies facing cash flow difficulties or expenses related to the coronavirus, expenses incurred during the period will be deducted from their income taxes.
To curb the pandemic, Côte d'Ivoire has opened 13 screening sites in the main communes of Abidjan, raised awareness about physical distancing and has increased hospital capacity by 600 beds. After a drop in infections towards the end of 2020, coronavirus cases started to rise again at the beginning of 2021. At the start of April, the country launched its Covid-19 vaccination campaign. The military, health workers and people aged 18 and over are eligible.
“Today, I am being vaccinated against Covid-19. It’s very quick! It’s protecting ourselves and our people. It’s protecting Côte d'Ivoire and allowing us to live again as we did before. The vaccine will be available to all those who need it,” said Prime Minister Patrick Achi on national television, as he received his first vaccine dosage.
On 13 April 2021, Côte d'Ivoire had recorded 45,227 cases of Covid-19, with 44,683 people having recovered and 268 deaths.
Find out more about the Bank's Covid-19 response (https://bit.ly/3nuWsWL).
Distributed by APO Group on behalf of African Development Bank Group (AfDB).