Fitch upgrades Cote d'Ivoire's foreign currency IDR to BB-

Fitch Ratings has recently upgraded Cote d'Ivoire's Long-Term Foreign-Currency Issuer Default Rating to 'BB-' from 'B+', with a Stable Outlook. This move signals a significant vote of confidence in the country's economic stability and growth prospects. In an exclusive interview with CNBC Africa, Cedric Berry, Associate Director at Fitch Ratings, shed light on the key drivers behind this upgrade and the factors supporting Cote d'Ivoire's positive outlook. The primary catalyst for the upgrade, according to Berry, is the reduction in political risk in the country. Despite a history marked by civil conflicts and political tensions, Cote d'Ivoire has made substantial progress in stabilizing its political climate. Berry highlighted the recent parliamentary elections in March, which saw widespread participation and acceptance of the election results, as a crucial step towards national reconciliation and stability. Furthermore, Berry emphasized the importance of President Watarez's party retaining its majority in parliament for the continuity of economic reforms and development programs. The government's commitment to maintaining fiscal stability while pursuing an ambitious development agenda has been a key factor in bolstering investor confidence and supporting the country's economic growth. In line with Fitch Ratings' expectations, Cote d'Ivoire is poised for a robust economic recovery, with GDP growth projected to reach 6% this year. Berry noted that the drivers of this growth, including growing domestic demand and increased private investment, are underpinned by the government's proactive policies and infrastructure projects. The sustained focus on infrastructure development is seen as a strategic move to facilitate private sector expansion and economic diversification. While the outlook for Cote d'Ivoire appears positive, Berry also cautioned against potential risks, such as a resurgence in COVID-19 infections. While the country has thus far managed the pandemic relatively well, a new wave of infections could pose challenges to both economic growth and fiscal stability. However, Berry expressed confidence in Cote d'Ivoire's resilience and ability to weather such shocks, given its current trading levels and fiscal buffers. Overall, Fitch Ratings' decision to upgrade Cote d'Ivoire's foreign currency IDR reflects a confluence of factors, including improved political stability, sound economic policies, and strong growth prospects. As the country continues on its path of development and reform, maintaining a balance between growth and fiscal prudence will be key to sustaining its positive trajectory.