<p>Already the world’s top cocoa exporter and one of the top coffee producers, Côte d’Ivoire is cashing in on the cashew nut boom, racing to outperform India as the world’s leading grower of cashews.In 2014 the global cashew market was valued at a whopping $4.69 billion, according to the International Nut & Dried Fruit Council. Over the past decade, cashew output in this West African country has tripled. <br></p><p>India, China spur global consumption boom</p><p>Growing consumption throughout the world has caused global exports and prices to skyrocket, resulting in a nearly 50 percent increase in the value of Ivorian cashew shipments this year. With the lion’s share of the surge stemming from Indian and Asian markets, a new-found thirst for healthier living among the fast-growing middle classes in these developing countries have become a key driver of cashew demand.In India, the nut is often ground to a paste for curries and sweets and consumption has reached an all-time high. Local demand is increasing 15% annually and has more than doubled since 2004 to 240,000 metric tons.Indeed, demand for imported nuts is so vigorous that China’s Ministry of Finance reduced import tariffs for certain nuts at the beginning of the year. Purchases have reached 50,000 tons, up from almost nothing a decade ago. <br></p> <p><a target="_blank" rel="nofollow" href="http://i1.wp.com/globalriskinsights.com/wp-content/uploads/2015/12/fwaedads.jpg?resize=704%2C328">http://i1.wp.com/globalriskinsights.com/wp-content/uploads/2015/12/fwaedads.jpg?resize=704%2C328</a> <br></p> <p>As of June 30th, Côte d’Ivoire’s cashews production reached a record 625,000 tons, a stark comparison to the 185,000 tons it produced ten years ago. Next year, the country hopes to produce 700,000 tons. This trend speaks to a growing recovery for the country’s economy, but much remains to be done to capitalize on its potential. <br></p> <p>Côte d’Ivoire needs to invest in local processing</p> <p>A critical bottleneck for investment is Ivorian processing capacity, or lack thereof. Ninety-five percent of Ivorian output is exported raw to India and Vietnam for processing. Malamine Sanogo, managing director of the Cotton and Cashew Council (CCA)’s marketing board recognizes this issue: “we think that with processing we will create many jobs and we will create lots of added value for the country,” he said. The CCA plans on having 35 percent of Côte d’Ivoire’s raw cashew output processed locally within the next five years.The cashew industry has captured the attention of a government desperate to jump-start its economy and facilitate its transition to emerging nation status, a goal it hopes to achieve by 2020. Although billion-dollar investments in large infrastructure projects has fueled growth, profits have yet to reach the nearly half of Ivoirians who live on less than $2 per day.A study carried out by the CCA predicts that every 100,000 tons of processing capacity Côte d’Ivoire develops will create 12,300 factory jobs and another 10,000 elsewhere in the sector. The success of this project would make Côte d’Ivoire the first African nation to build a large-scale cashew nut processing sector as a remedy for unemployment. The African Cashew Alliance believes that a 25 percent increase in raw cashew nut processing in Africa would add over $100 million to household incomes. <br></p> <p>Côte d’Ivoire courts commerce</p> <p>Under President Ouattara’s savvy direction, the government has carried out a series of large-scale infrastructure makeovers, desperate to entice private sector investors and foment economic growth. Centered on a $22 billion infrastructure investment program, structural reforms including the construction of 24 new bridges, a face lift of San Pedro – the country’s second largest port – and the improvement of railways and airports.Increased borrowing has covered much of the investment spending, and within the last two years, Côte d’Ivoire has issued two Eurobonds for a total of $1.75 billion.After a five year long civil war and political bedlam that split a rebel-held north from the government-controlled south for nearly a decade, the evolution of the cashew industry has abetted economic recovery. Now the nation’s second-most valuable crop, cashews have emerged as a pivotal cash crop for Côte d’Ivoire’s impoverished north.Alien to Côte d’Ivoire, cashew trees were imported in the 1960s in an effort to reforest the parched northern provinces and combat desertification. They were largely neglected as a commercial crop until the 1990s, when strapped northern farmers began to seek substitutes to soil-damaging crops like cotton and yams. The Ivorian economy relies heavily on its agricultural sector and is highly sensitive to both fluctuations in international prices and weather conditions. <br></p> <p><a target="_blank" rel="nofollow" href="http://i2.wp.com/globalriskinsights.com/wp-content/uploads/2015/12/1x-1.jpg?resize=900%2C506">http://i2.wp.com/globalriskinsights.com/wp-content/uploads/2015/12/1x-1.jpg?resize=900%2C506</a></p> <p>As one of Africa’s best performers, and West Africa’s second largest economy, Côte d’Ivoire has witnessed an impressive yearly growth rate of 9% since 2012, a number the government hopes will reach double digits this year. Paired with a 2.5% inflation rate, Côte d’Ivoire indisputably boasts great economic potential.In recent years, bullish investors have been courting Côte d’Ivoire, attracted by its rapid growth and generous terms offered by Ouattara’s administration, such as VAT exemption and reduced customs duties. Germany’s Commerzbank has already opened up an office and Standard of South Africa is also seeking to establish a regional hub. Earlier this year, Heineken NV announced that it would build a $164m brewery. French supermarket Carrefour is expected to open a grocery store in Abidjan next month, its first in Sub-Saharan Africa. French retail chain FNAC is also setting up shop. <br></p> <p>Post-war stability a tough nut to crack</p> <p>While there are copious opportunities for investors and businesses in Côte d’Ivoire, there is no shortage of challenges. Unemployment, especially among youth, remains a chief concern for those seeking to counter future instability. The country is also awash with arms from the civil war and widespread insecurity continues to plague the country, particularly the north and west.Even more importantly, however, is the threat of political violence following recent elections. The first presidential vote since its civil war was expected to be highly contentious, as the reigning party dodged accusations of arbitrary arrests, human rights violations, and alleged murder of activists. President Ouattara won by a landslide, garnering 84% of the votes and so far, the elections have unfolded with relative serenity.If the country can contain violence and sustain its growth trajectory, there is significant promise for Côte d’Ivoire post-war economic renaissance.<br></p>