The banking system of the world’s top cocoa grower has been heading towards total collapse this week, with virtually all commercial banks shut and others swamped by customers trying to withdraw savings.
The closures are the consequence of an international sanctions effort to squeeze Gbagbo of funds and force him to stand down after UN-certified results of a November 28 election showed his rival Alassane Ouattara the winner.
“President Laurent Gbagbo … has made a decree that the Ivorian state take control, via a total and complete stakeholding in the capital of these banks,” a statement issued after a cabinet meeting said.
The statement referred to the country’s biggest bank, a unit of France’s Societe Generale, which suspended business on Thursday as part of an exodus of foreign banks that turned political crisis into financial meltdown
It also cited French BNP Paribas’s unit and Standard Chartered. It also named “City Bank” in an apparent reference to Citibank — which also shut up shop — but did not mention Nigeria’s Access Bank.
“The main goal … is to assure the continuous opening of these banks and make sure citizens have access to their assets”.
The violent power struggle Gbagbo and Ouattara is ruining the nation’s economy, as EU and U.S. sanctions on Gbagbo and his backers for refusing to cede power start to bite.
“It means there is no properly functioning banking system anymore.” said Standard Bank analyst Samir Gadio of the spate of closures, which could make it hard for Gbagbo to pay February’s round of public sector and army wages.
“I don’t see how the (Gbagbo) government would be able to remain in charge … he is in a corner somewhere.”
The election was meant to reunite a country divided by a 2002-3 war, but the stand-off, which has killed some 300 people according to the United Nations, has merely deepened divisions.
Five African leaders charged with finding a solution to the crisis are due to meet this weekend, but Ouattara’s camp doubts they will succeed and called on Ivorians to mount a Tunisian- or Egyptian-style revolution rather than seek outside help.
Gbagbo has defied pressure to step down after a pro-Gbagbo legal body reversed the results showing Ouattara won the poll.
He has been cut off from the West African central bank and has seized its local office, triggering a liquidity crisis.
Shutters were down on branches across Abidjan, the main city, while customers tried to shout, push and sometimes punch their way through crowds outside the few banks still open.
“I don’t see why we should suffer because of politicians,” said Hamed Yao, 31, a book seller, at an Ecobank branch where a security guard was overwhelmed as clients stampeded in.
The Ivorian-owned International Bank for West Africa BIAO and Banque Atlantique also shut on Thursday afternoon.
But six smaller banks, including pan-African Ecobank and three government-owned firms, were still open.
A $2.3 billion defaulted Ivorian Eurobond shed half a point to 36.48 percent, to yield of 16.9 percent.
CALL FOR REVOLUTION
In a sign Gbagbo’s government may be getting desperate for money, the head of the cocoa regulator Gilbert Anoh told Reuters he would seek export tax from companies for cocoa in warehouses, even if sanctions prevent them from exporting. .
“By March 31 we will recover all royalties from the cocoa in warehouses. Whether or not it gets exported, it will be paid.”
Cocoa farmers burned sacks of beans outside the Ivorian offices of the European Union to protest against sanctions on regulators that are strangling the cocoa trade.
The crisis has pushed cocoa futures to fresh highs.
Gbagbo, who remains in control of the military and the state broadcaster, is likely to blame the crisis on Ouattara, who has been backed by world leaders but remains blockaded in a lagoon-side hotel, protected by U.N. peacekeepers.
Ouattara’s Prime Minister Guillaume Soro acknowledged previous killings by the security forces during attempts to hold protests but said the alternative, doing nothing, was worse.
“The people of Ivory Coast should not expect anything from the African Union … The people of Ivory Coast must have its revolution … chase Gbagbo from power,” he said in Dakar. Reuters