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Viewing cable 09COTONOU257, BENIN ECONOMIC NEWS: APRIL 15-JUNE 15, 2009

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Reference ID Created Released Classification Origin
09COTONOU257 2009-06-19 08:00 2011-08-26 00:00 UNCLASSIFIED Embassy Cotonou
R 190800Z JUN 09
FM AMEMBASSY COTONOU
TO SECSTATE WASHDC 0975
INFO ECOWAS COLLECTIVE
MILLENIUM CHALLENGE CORP WASHDC
AMEMBASSY PARIS 
AMEMBASSY DAKAR
UNCLAS COTONOU 000257 
 
 
DEPT FOR AF/EPS: AF/W: ACOOK 
DEPT PLEASE PASS USTR (LAGAMA) 
PARIS FOR BKANEDA 
LONDON FOR PLORD 
DAKAR FOR FAS RHANSON 
 
E.O. 12958: N/A 
TAGS: EAGR EFIN ECON PGOV BN
SUBJECT: BENIN ECONOMIC NEWS: APRIL 15-JUNE 15, 2009 
 
1. This Benin Economic News focuses on the 2008-2009 cotton news, 
President Yayi's visit to Nigeria, and the sacking of the Minister 
of Economy and Finance. 
 
COTTON NEWS 
----------- 
 
2. On June 4, 2009 the Cotton Stakeholders Association, AIC, 
informed Post that the 2008-2009 cotton production amounted to 
210,603 metric tons, 13 percent below projections of 242,000.  AIC 
explained that the estimated figure was not reached for a number of 
reasons.  AIC indicated that poor rain fall in some areas and heavy 
down pour in others resulted in damage to the crop and the 
resurgence of pests thwarted the projections. 
 
3. On June 5, 2009, the GOB announced the prices of cotton gin (raw 
cotton and seeds) and cotton agricultural inputs for the 2009-2010 
cotton campaign.  The producers' prices are $0.40 and $0.30 (190 and 
140 Francs CFA) per kilogram for the first and the second choice 
respectively.  Fertilizer will be supplied at $0.51 (240 Francs CFA) 
per kilogram and pesticide at $15.00 (7,030 Francs CFA) per liter to 
cotton growers. 
 
PRESIDENT YAYI'S VISIT TO NIGERIA 
--------------------------------- 
 
4. On June 9, 2009, President Yayi paid a one-day visit to the 
Nigerian President Umaru Yar'Adua. The two Heads of State discussed 
issues related to the financial crisis affecting the economy of 
their respective countries. They convened a joint commission to find 
solutions likely to help mitigate the impact of the financial crisis 
on both countries. The economy of Benin heavily depends on trade 
between the two countries and particularly on the imports of used 
cars through the Port of Cotonou. The export of used cars to Nigeria 
slumped over 50 percent. 
 
PRESIDENT YAYI SACKS HIS MINISTER OF ECONOMY 
-------------------------------------------- 
 
5. On June 10, 2009, the Minister of Justice, Victor Tokpanou, 
announced, on TV, the dismissal of the Minister of Economy and 
Finance, Soule Mana Lawani and gave the name of his replacement, 
Idriss Daouda.  President Yayi sacked his Minister because he did 
not properly handle the demands of public health workers who had 
been on a three-month strike, claiming payment of their pending 
allowances. Daouda is Banker and Economist by profession, a retired 
employee of the West African States Central Bank, BCEAO, and a 
former National Director (1998-2006) of BCEAO representation in 
Benin. Until his ministerial appointment, Daouda was member of the 
Benin Post and Telecommunications Regulatory Authority. 
 
6. According to the GOB Council of Ministers' report of June 9, 
2009, Lawani and the former Minister of Health, Kessila Tchalla were 
blamed for not consulting the Council of Ministers before announcing 
a ministerial order dated April 28, 2008 to grant incentive 
allowances to the public health workers (additional cable by POL is 
forthcoming).  These allowances were the subject of a series of 
negotiations between these ministers and the trade unions in 2008. 
The report indicated that the GOB cancelled this order because it is 
not consistent with a 1986 law governing civil servant status in 
Benin. However, to encourage the public health workers to resume 
work at their respective health facilities, the GOB has decided to 
go ahead with the payment of these allowances starting in June 2009, 
despite its impact on the country's 2009 budget.  The payment will 
be spread over two years and will be broken into three phases, 50, 
25, and 25 per cent. 
 
7. President Yayi also used the dismissal opportunity to switch the 
portfolios of Gregoire Akofodji, the Minister of Industry and Roger 
Dovonou the Minister of Agriculture, Animal Husbandry, and Fishing. 
Yayi changed Dovonou's portfolio political reasons. According to the 
Permanent Secretary of the Cotton Stakeholders Association, 
Barthelemy Gagnon, President Yayi did not fully give way to 
political pressure from some members of the political coalition 
endorsing his policy, demanding Dovonou's dismissal and his 
replacement by another political figure from the same town as 
Dovonou. President Yayi switched his portfolio instead. 
 
RAWLINGS