By Joe Bavier and Ange Aboa
ABIDJAN (Reuters) - Ivory Coast may turn to China for more loans to finance a post-war recovery in French-speaking Africa's largest economy, the minister in charge of finance and the economy said, as President Barack Obama visited the region to revive U.S. engagement.
Niale Kaba said the world's top cocoa grower is also planning to relaunch a privatisation scheme that should see the state liquidate its stakes in a range of sectors, starting with several banks of which it is majority owner.
After winning a 2010 election and the brief civil war that followed, President Alassane Ouattara is pushing investment in critical infrastructure left neglected during Ivory Coast's decade-long political crisis.
"We have a lot of potential and a lot of ambition. And that ambition requires financing," said Kaba, who manages the finance and economy portfolio taken over by Prime Minister Daniel Kablan Duncan in a November reshuffle.
A national development programme calls for investments of around $20 billion over the next five years and Ivory Coast is seeking financing for several large infrastructure projects from traditional donors and public-private partnerships.
However, Kaba said the conditions offered by China's Exim Bank made its loans particularly attractive.
Chinese financing could be used for projects including an expansion of Ivory Coast's main port, a plan to link up regional rail lines, and the extension of existing motorways, she said.
"I believe the loans from Exim Bank are loans that can finance in a relevant way certain sectors ... It's a good opportunity for Ivory Coast to make the structural investments necessary to sustain growth," she said in an interview.
"The rates are low, the time-frame is long, and we have grace periods of seven to nine years. So that allows you to make the investment and wait a bit for the investment to bear fruit before you start paying it back," Kaba said.
Ivory Coast has secured two loans totalling $615 million from Exim Bank to fund a motorway and hydroelectric power plant.
LONG WAY TO GO ON PRIVATISATIONS
Obama, the U.S.'s first African-American president, was in Senegal on Thursday on his second visit to the continent since taking office in 2008.
Administration officials say the trip is an opportunity to jump-start the relationship. Analysts say U.S. neglect of Africa's potential has left it to play catch-up with China.
During his own African tour earlier this year, Chinese President Xi Jinping renewed an offer of $20 billion of loans between 2013 and 2015.
Ivory Coast adopted its first privatisation programme in 1990 well before most of its neighbours. However, the project slowed during the political crisis of the last decade.
"The prime minister has reactivated the privatisation committee," Kaba said. "We will look at which sectors the state can withdraw from. We're at the beginning of the process."
Kaba said privatisations were expected to begin with the banking sector. The Ivorian state holds majority stakes in five banks: Versus Bank, BNI, BFA, CECP and BHCI.
The government has commissioned an audit of the five institutions, with initial results due in late August.
"The banks from which the state will withdraw will be defined by the study ... And it will only be then that we will be able to make a financial evaluation of the expected earnings," Kaba said.
Source: http://news.yahoo.com/ivory-coast-may-seek-chinese-financing-post-war-070906113.html
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