Republic of Côte d'Ivoire Urbanization Review
Cities, Growth, and Productivity in Côte d’Ivoire
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- Although lagging on aggregate income per capita, manufacturing appears to be correlated with urbanization in Côte d’Ivoire.
- Figure : The Ivorian economy is underperforming urbanization … Figure : … although manufacturing is better correlated with urbanization
- Urbanization economies in Côte d’Ivoire have been negatively affected by the predominance of Abidjan and the limited economic activities in secondary cities, as well as a succession of crises.
- Figure : The population gap between Abidjan and other Ivorian cities has widened since 1975
- Abidjan’s primacy is corroborated by freight flows between Ivorian cities, which are heavily tilted toward Abidjan from small and from secondary cities (figure 9).
- Figure : The main economic flows from Ivorian cities are toward Abidjan
- Figure : The correlation between urbanization and income shifted after 1978
- Most firms are in a few southern cities, encouraging migration to these cities and their hinterlands.
- This concentration calls for rethinking Ivorian cities.
Cities, Growth, and Productivity in Côte d’IvoireManaging urbanization well is critical for meeting the challenges of moving to middle-income-country status. With an urban population at 50 percent,4 Côte d’Ivoire’s economy is underperforming urbanization: GNI per capita should be around $2,700, if urbanization economies worked as economic geography theory predicted (figure 5). Georgia, Guatemala, and Indonesia, for example—countries in three different continents with an urban population close to that of Côte d’Ivoire—have a GNI per capita of $3,570, $3,340, and $3,580. Some other Sub-Saharan African countries such as Cameroon and Ghana share the same fate. This seems to corroborate the theory of “consumption cities” vs. “production cities” developed by Glaeser (2001) and Jedwab (2013), among others. By this theory, urbanization in countries with consumption cities is not paced by a structural transformation of the economy because the rent generated by the resource-intensive sector is consumed in cities by workers involved in nontradable service sectors (typically in the informal sector). Although lagging on aggregate income per capita, manufacturing appears to be correlated with urbanization in Côte d’Ivoire. Globally, manufacturing is the engine of growth for large to medium cities with good access to markets. As countries urbanize, their manufacturing sectors tend to grow as a share of GDP until urbanization reaches 60 percent, with manufacturing as a share of GDP generally peaking at over 15 percent. The correlation between manufacturing and urbanization in Côte d’Ivoire appears to be above this trend, even if manufacturing as a share of GDP consistently declined from a peak of 17.7 percent in 2000 to 12.7 percent in 2013 (figure 6). The decline started after the first military coup in December 1999, which was followed by a series of sociopolitical tensions that reached a culminating point after the runoff of the presidential election in November 2010. This instability might explain the deteriorating performance of manufacturing, because investment in growth-sustaining infrastructure abruptly stopped during that period.
Urbanization economies in Côte d’Ivoire have been negatively affected by the predominance of Abidjan and the limited economic activities in secondary cities, as well as a succession of crises. Urban primacy is defined as the share of the largest city in total urban population. In Côte d’Ivoire, Abidjan’s primacy varied from 24 percent in 1975, to 49 percent in 1988, to 44 percent in 1998, and to 40 percent in 2014 (figure 7). In 2013, the average and median values of urban primacy for Sub-Saharan African countries were 37 and 38 percent respectively. Although declining, urban primacy in Côte d’Ivoire is still high.5 Using firm-level data (Banque de Données Financiers, BDF), Coulibaly et al. (2014) found that for 2010, the location quotient (a proxy measure of urbanization economies) had a positive and statistically significant impact on firms’ sales: a 10 percent increase in the location coefficient of a sector in a region would lead to a 2 percent increase in sales of firms operating in that sector and region (figure 8). This result is stronger for the Centre-Ouest (Daloa) and Nord-Ouest (Odienne) regions, with a 10 percent increase in the location quotient of these regions leading to a 15 and 17 percent increase in the sales of firms operating there, respectively. By contrast, a 1 percent increase in the location quotient of the Sud (Abidjan) region is associated with a decrease in sales by 10 percent, indicating that congestion costs are prevailing in this city of 4 million inhabitants. Figure : The population gap between Abidjan and other Ivorian cities has widened since 1975 Source: WDI; World Bank staff calculations Note: CIV: Côte d’Ivoire; GEO: Georgia; GTM: Guatemala; IDN: Indonesia. Figure : Economic concentration seems to negatively impact firms’ sales in Abidjan
Source: Coulibaly et al. (2014), using INS firms’ financial statement statistics, 1999–2011. Abidjan’s primacy is corroborated by freight flows between Ivorian cities, which are heavily tilted toward Abidjan from small and from secondary cities (figure 9). Four decades of successive economic and sociopolitical crises constraianing investment and maintenance of urban infrastructure seem to have taken a toll on Abidjan’s capacity to generate urbanization economies.. Figure : The main economic flows from Ivorian cities are toward Abidjan Source: Urban Transport Survey, ENSEA (2014) The trend in the correlation between urbanization and per capita income has been in the wrong direction since 1978. Constraints such as limited access to land, housing, transport, and infrastructure slow urbanization, while growth in the number of people with secondary education appears to accelerate it. Indeed, Coulibaly, Esso, and Kanga (2014) find that secondary schools are concentrated in regional capital cities; this explains the elevated population with a high school education in secondary cities. The population with a secondary education is more likely to migrate than one with a primary or tertiary education. Students completing primary education move to secondary cities to complete their studies and remain if they do not pursue higher education. This finding should guide initiatives to diversify the economy of secondary cities, and reverse the declining trend in correlation between urbanization and per capita income (figure 10). Figure : The correlation between urbanization and income shifted after 1978 
Source: WDI; World Bank staff calculations Note: CIV: Côte d’Ivoire; SSA: Sub-Saharan Africa; Other: All other countries excluding SSA countries Most firms are in a few southern cities, encouraging migration to these cities and their hinterlands. Between 1999 and 2011, 89–96 percent of registered firms were in the South (mostly in the Greater Abidjan area). This area also has 80 percent of formal jobs, and is the main employment zone for sectors such as services to households and industries, transport, telecommunications, wholesale and retail, and food and agriculture (Coulibaly, Esso, Fe and Kanga 2014). The concentration of companies in the South is due to Abidjan’s position as the country’s main economic hub, having one of the largest ports in Sub-Saharan Africa—the Autonomous Port of Abidjan—as well as a deep sea port at San Pédro. The rest of the country subsists mainly by growing cash or food crops. This concentration calls for rethinking Ivorian cities. As Côte d’Ivoire moves from lower- to upper middle-income country status, its urban centers are expected to play a key role in its economic recovery as centers for economic activity and trade, for basic services (health and education), and as centers for job opportunities (informal and formal). This key role of cities has been seen in East Asian countries like Indonesia, Malaysia, the Philippines, and Thailand where urban primacy was estimated in 2003 at 12, 14, 21, and 32 percent, respectively.6 While the military conflict, political unrest, and decades of under-investments in key infrastructure have kept several cities and urban areas less efficient and less prosperous, urban areas remain critical in propelling sustainable economic growth by becoming effective production centers for the core economic drivers, such as agriculture, mining and energy, and services. Better management of urbanization—prioritizing backbone infrastructure and services able to sustain manufacturing and tradable services—could both attract activities needing increasing returns to scale in cities and boost growth and job creation. Such management should also improve the delivery of public services such as water, sanitation, waste management and other public amenities (electricity, urban transport) as well as social services, helping the country deliver on the twin goals of poverty reduction and shared prosperity. Directory: curated curated -> Concept stage curated -> Concept stage curated -> Report No: aus11011 Central America curated -> Report No. 94474-pk fiscal Disaster Risk Assessment Options for Consideration curated -> Environmental and Social Management Framework for the Costa Rica Telecommunications Sector Modernization Project curated -> Environment Impact Assessment For Jiangxi Shangrao Sanqingshan Airport Beijing Guohuantiandi Environmental Technology Development Center. Ltd. Oct. 2012 Content curated -> Growth through Innovation An Industrial Strategy for Shanghai By Shahid Yusuf Kaoru Nabeshima April 22nd, 2009 curated -> Report No: 70178. People's Republic of China curated -> Making Nutrition Policy Central to Development Understanding the Political and Institutional Conditions for Policy Change Case Study of the Political Economy of Nutrition Policies in Ethiopia Prepared By Download 0.83 Mb. Share with your friends:
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