1. Introduction

Since the devaluation of the CFA franc in January 1994, Mali has experienced a significant pickup in economic activity. ^2/ After nearly a decade of economic stagnation, real GDP grew by 2.3 percent in 1994 and by an estimated 6.4 percent in 1995. ^3/ The turnaround in economic activity came about as the result of improvements in Mali’s external competitiveness and was most pronounced in export-oriented sectors, and the cotton sector in particular, as well as in import substitution sectors. After an initial correction, the annual rate of domestic price increase fell to 10.5 percent in the last quarter of 1995 from 32.2 percent in the same period in 1994, owing to the containment of labor costs, as well as abundant supplies and relatively stable prices of staple foods during this time period.

Despite the impact of the devaluation on government spending, the overall fiscal deficit was limited to 13.7 percent of GDP in 1994, with government revenue declining by the equivalent of ½ percentage point of GDP and total expenditure rising by about 3½ percentage points. In 1995, the fiscal situation improved significantly as the overall government deficit, on a commitment basis and excluding grants, was reduced by more than 2 percentage points of GDP; revenues increased by 1 percentage point of GDP and expenditures decreased by the equivalent of more than 2 percentage points of GDP.

2. Production and prices

Over the period 1994–95, real GDP grew by 8.8 percent on a cumulative basis, led primarily by strong performances in the primary sector. Agricultural growth, benefiting from favorable climatic conditions as well as enhanced competitiveness, was broadly based: food crops grew by a cumulative 34 percent; livestock production rose by 9.2 percent; and cash crops (primarily cotton) rose by almost 20 percent in 1995, following a 16 percent drop in 1994. In the secondary sector, output grew by 9 percent, thanks to strong gains in construction and public works. The tertiary sector experienced a cumulative 1 percent decline in output; trade and services both experienced output increases, but they were more than offset by a 25 percent drop in public sector services.

Both the expenditure-reducing and switching effects of the devaluation were quite strong over the period 1994–95, as evidenced by the decline in aggregate consumption: both private and government consumption declined by almost 2 percentage points of GDP each. Investment spending rose significantly over this period, from about 22 percent of GDP in 1993 to 26 percent in 1995. Private investment, largely in the gold mining and cotton sectors, rose by almost a full percentage point of GDP, while government investment increased by more than 3 percentage points. Mali’s rising investment expenditure over the 1994–95 period was financed largely by higher domestic savings as well as the increased use of foreign savings.

In the wake of the devaluation, inflation, as measured by the consumer price index for Bamako, peaked at 32 percent on an end-of-period basis in the last quarter of 1994. ^1/ The inflation rate declined rapidly over 1995, ending the year at a quarterly rate of 10.5 percent. Since the devaluation, the Malian authorities have endeavored to implement policies designed to contain labor costs. The rapid fall-off in the rate of inflation suggests that, by end-1995, the inflationary impact of the devaluation had largely worked its way through the economy and that the authorities’ strict anti-inflation policies had been largely successful.

3. Fiscal developments

Early in 1994 the authorities introduced a number of measures aimed at increasing government revenue and limiting spending following the devaluation. At the same time, customs duties and certain domestic taxes were reduced to mitigate the impact of the devaluation-induced rise in costs and prices on vulnerable population groups and to lower external protection. The public sector demand management policies contributed to containing the increase in the overall budget deficit resulting from the devaluation. The overall budget deficit (on a commitment basis and excluding grants) rose by 4 percentage points of GDP, to 13.6 percent in 1994. Revenue fell by ½ a percentage point of GDP, to 13.5 percent, largely because of a weakening in customs collections as imports declined and certain customs duties were either reduced or suspended, while expenditures rose by 3½ percentage points, to 27 percent. A pivotal element of Mali’s program was the implementation of a restrained civil service wage policy. On the basis of an agreement between the government and the labor unions representing civil servants, the increase in salaries was limited to 10 percent in April 1994. Subsequently, an additional increase of 5 percent, originally scheduled for January 1995, was granted in October 1994; the resulting budgetary impacts were offset by other budgetary savings, primarily in the area of recruitment. The government’s wage bill was reduced by nearly 13 percent in real terms in 1994. There was no civil service wage increase in 1995, further reducing the real wage bill. Given the wage bargaining system in Mali, where private sector wages closely follow those of the civil service, the government’s wage policy had the effect of minimizing demonstration effects, thus preserving the competitiveness gains stemming from the devaluation.

In 1995 the overall government deficit declined by more than 2 percentage points from 1993, to 10.5 percent of GDP, as revenue rose to 14.4 percent of GDP, while expenditures fell to 24.9 percent of GDP. The strong growth in revenue was partially due to higher nontax receipts, including exceptional receipts from the cotton sector and privatization. Actions taken to improve the tax and customs administrations, reduce tax exemptions, and combat fiscal fraud were also instrumental in strengthening revenue performance. ^1/ On the expenditure side, total outlays were kept under strict control, with the government’s restrained wage policy again playing a central role.

4. Monetary and credit developments

Monetary developments in 1994 and 1995 were characterized by a strong recovery in money demand (as money balances were reconstituted in the wake of the devaluation), a strengthening of the net foreign assets position of the banking system, a strong expansion of credit to the private sector, and a substantial reduction of government indebtedness to the banking system.

Credit conditions remained generally tight throughout 1994. Following the devaluation, the Central Bank of West African States (BCEAO) raised the discount rate to 14.5 percent on January 18, 1994, from 10.5 percent. Subsequently, and as inflationary pressures in the region began to abate, credit conditions were progressively eased; the BCEAO’s discount rate was reduced in four steps, reaching 9 percent on January 23, 1995. In 1995, there were two additional cuts in the discount rate: to 8.5 percent on June 5 and further to 7.5 percent on December 26.

Broad money increased by 39 percent in 1994. ^2/ After an initially sluggish expansion of bank credit to the economy, private sector credit rose moderately during the last few months of the year, reflecting some recovery in economic activity. In 1995, broad money growth slowed to about 20 percent, net credit to the government contracted significantly, and credit to the economy rose sharply, particularly toward the end of the year.

A source of concern for the monetary authorities in the first half of 1994 was the sharp increase in commercial bank liquidity caused by the reflows of private capital; the improved financial position of, and the resulting demand for credit by, export-oriented enterprises; and the cautious attitude of the banks themselves. However, in the last months of the year, commercial banks utilized part of their excess liquidity to purchase securities, issued by the BCEAO as part of the securitization of the consolidated public debt (CFAF 23.9 billion) assumed by the government in the context of the restructuring of the Malian banking system during the late 1980s. The securitization scheme, developed by the BCEAO, involved the issuance of 12-year securities, redeemable on demand and at par, carrying a tax-exempt interest rate of 5 percent. Similar BCEAO-backed schemes, applicable to government debt issued by other member countries of the West African Economic and Monetary Union (WAEMU), established during the same period enabled Malian banks to purchase an additional CFAF 19.8 billion of securities issued by other WAEMU countries. The expansion of the banks’ credit activities toward the end of the year further contributed to reducing excess liquidity.

In April 1995, the Meridien International Bank Limited (MIBL) was liquidated; its subsidiary, Meridien-BIAO-SA, owned 61.5 percent of the capital of BIAO-Mali, with the remainder being held by the Malian private sector. ^1/ As part of the financial shoring up of the bank, renamed Banque Internationale du Mali (BIM) in June 1995, a five-year equity loan of CFAF 3 billion was extended by the government to strengthen its capital base and ensure the observance of prudential ratios established by the regional banking commission. ^2/

5. External sector developments

After initially deteriorating over the period immediately following the devaluation, Mali’s external position strengthened significantly in 1995, owing largely to an improvement in external competitiveness. Between the fourth quarter of 1993 and 1995, Mali’s CPI-based real effective exchange rate depreciated by some 27 percent. The current account deficit (excluding official transfers) rose from 12.9 percent of GDP in 1993 to 17.8 percent in 1994, and then declined to 14.6 percent in 1995. The improvement in the current account was due largely to a strong recovery in exports, with export volumes increasing by 1.7 percent and by 24.8 percent in 1994 and 1995, respectively. Mali’s improved competitiveness had a particularly favorable effect on exports of cotton, gold, livestock, and fruits and vegetables. In the cotton sector, which accounts for the largest share of exports, favorable developments in the world price of cotton also contributed to the rebound in the value of cotton exports in both 1994 and 1995. In light of these developments, and given the positive impact of favorable climatic conditions, the volume of cotton fiber exports rose by 36 percent in 1995. The volume of imports declined 4.2 percent in 1994, but rose by almost 10 percent in 1995 along with the recovery in the general level of economic activity and the substantial investments in the gold mining sector during the year.

The services account deteriorated during 1994 and 1995, partly because of the growing demand for services in the gold mining sector. The capital account swung from a small deficit in 1993 into surplus for both 1994 and 1995, reflecting inter alia a significant increase in external financial assistance, as well as significant private capital inflows related to investments in the gold mining sector and a return of flight capital.

Mali’s external public debt amounted to US$2.7 billion (CFAF 1,406 billion, or 142 percent of GDP) in 1994, up from US$2.6 billion (CFAF 760 billion, or 101 percent of GDP) the previous year. In 1995, the stock of debt was estimated at US$2.9 billion (CFAF 1,397 billion, or 113 percent of GDP). The bulk of debt outstanding at end-1995 was owed to multilateral creditors (54 percent), including IDA (29 percent), the African Development Bank (12.8 percent) and the IMF (5.2 percent). Debt owed to official bilateral creditors accounted for 46 percent of the total, with debt owed to Paris Club creditors representing 12 percent and that to the Russian Federation estimated at 18 percent. External payments arrears, owed to both multilateral and bilateral creditors, were eliminated in 1994. Mali’s financial obligations to foreign commercial banks and official export credit agencies accounted for less than 0.1 percent of total debt outstanding between 1992 and 1994, and was entirely eliminated in 1995. ^1/

Mali’s scheduled external debt service increased from CFAF 47.5 billion (39.5 percent of exports of goods and nonfactor services) in 1993 to CFAF 94.1 billion in 1994 (42.2 percent), before declining to CFAF 83.8 billion (30.6 percent) in 1995. Over the 1994–95 period, Mali continued to benefit from debt relief under its October 1992 Paris Club rescheduling arrangement, debt moratoria from the Russian Federation and the People’s Republic of China, and debt cancellation equivalent to CFAF 114.7 billion granted by France, Italy, and Switzerland in early 1994.

With regard to Mali’s exchange and trade system, the key development over the 1994–95 period was, of course, the change in parity between the CFA franc and the French franc in January 1994. All other exchange arrangements remained unchanged; in particular, exchange rates for all other currencies officially quoted in the Paris exchange market remained based on the fixed rate for the French franc and the Paris exchange market rate for the currency concerned. There remain no taxes or subsidies on purchases or sales of foreign exchange; however, foreign exchange transfers are subject to a stamp tax.

Prior to June 1, 1996, Mali, as well as its WAEMU partners, availed itself of the transitional arrangements under Article XIV, Section 2, of the Fund’s Articles of Agreement. Nevertheless, Mali maintained an exchange system that was free of restrictions on the making of payments and transfers for current international transactions, similar in most respects to those of other French franc area countries. Effective June 1, 1996, Mali, in concert with its WAEMU partners, accepted the obligations of Article VIII, Sections 2, 3, and 4 of the Fund’s Articles of Agreement.

There were minimal changes to Mali’s trade regime over the period 1994–95. Customs and fiscal duties are levied on the c.i.f. values of imports from all countries. Import duties are applied on an ad valorem basis; there are two rates for customs duties (zero percent and 5 percent) and three rates for fiscal duties on imports (zero, 10 percent, and 25 percent). Imported goods from all countries are subject to a customs service fee, equivalent to 5 percent (3 percent for petroleum products) of the c.i.f. value of the imported goods. In 1994 the average effective tariff was 16 percent; it increased to 20 percent in 1995.

6. Savings and investment ^1/

In 1994, Mali registered a strong increase in investment; total investment expenditures rose to 26.5 percent of GDP from 21.9 percent in 1993, with government investment accounting for 13 percent of GDP, up from 9.3 percent, and private investment increasing from 12.6 percent to 13.5 percent of GDP. Rising investment expenditure, largely concentrated in the areas of gold mining, the cotton sector, and donor-financed development projects, was financed by an increase in domestic savings, up from 6.4 percent of GDP in 1993 to 6.7 percent in 1994, and an increase in official transfers in an amount equivalent to 13.3 percent of GDP in 1994, up from 8.9 percent in 1993.

The high level of investment spending posted in 1994 was essentially maintained in 1995, with total investment accounting for 26.0 percent of GDP. A decline of official transfers in 1995, equivalent to 4.3 percentage points of GDP, was offset by a significant increase in domestic savings, which rose from 6.7 percent of GDP in 1994 to 10.1 percent in 1995; significant increases were registered in both government and nongovernment sector savings.

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MALI: MAIN ECONOMIC INDICATORS, 1987–95

Citation: IMF Staff Country Reports 1996, 141; 10.5089/9781451826203.002.A001

Sources: Data provided by the Malian authorities; and staff estimates.1/ Percentage change in GDP deflator.2/ Central government, on a commitment basis.

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MALI: REAL AND NOMINAL EFFECTIVE EXCHANGE RATES JANUARY 1980–JUNE 1996

(Period average; 1990 = 100)

Citation: IMF Staff Country Reports 1996, 141; 10.5089/9781451826203.002.A001

Source: IMF Information Notice System.1/ Based on relative CPIs.

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1. Background

Mali has been a significant producer of cotton for about 40 years and now ranks as one of the largest cotton producers and exporters in sub-Saharan Africa. Cotton is grown under rainfed conditions in a region located south of the Niger River and west of Mopti. Total cultivated area currently exceeds 300,000 hectares, and an estimated rural population of 1.5 million people (out of a total population of 9.2 million) directly depends on cotton cultivation for its livelihood. In economic and financial terms, cotton represented in 1995 more than 50 percent of exports (CFAF 127 billion), 10 percent of government revenue (CFAF 16.4 billion), and 7 percent of total GDP. In 1995, farmers’ gross income directly generated by cotton production amounted to CFAF 38 billion, compared with a total government wage bill of CFAF 48 billion.

In Mali, cotton is primarily produced under the supervision of the Compagnie Malienne pour le Developpement des Textiles (CMDT). ^2/ The CMDT area covers five geographic regions and accounts for 95 percent of total cotton production in Mali. In addition to its key responsibilities of processing and marketing, CMDT provides a full range of production-related services to producers, including the sale of inputs, extension services, and cotton research. All seed cotton produced is ginned in a network of 13 ginneries operated directly by CMDT. Two textile companies, the Compagnie Malienne des Textiles (COMATEX) and Industry des Textiles du Mali (ITEMA) process cotton fibers domestically. Together, these two companies absorb less than 2 percent of total production, which is almost entirely exported as cotton fiber.

While the institutional structure of the cotton sector is built around the CMDT, as described above, additional support and development activities are carried out directly by farmers’ associations (Associations villageoises). The total number of associations currently exceeds 1,000; their main functions cover the distribution of inputs, the collection of cotton, and the guaranteeing as well as the distributing of credit for equipment. They also undertake health, literacy, and training programs, and participate in the construction of storage facilities.

2. Institutional framework

The responsibilities of the CMDT are spelled out in five-year performance contracts between the government, the CMDT, and cotton producers. The current performance contract, covering the period October 1994 to September 1998, extends the main provisions of the previous contract for 1989–94. The new contract reaffirms the main responsibilities of CMDT, namely processing and marketing of Mali’s cotton production, and contributing to rural development.

3. Characteristics of cotton cultivation

Over the past 10 years, total Mali an cotton production has averaged about 300,000 tons a year, although fluctuations between crop years have been substantial. These variations are for the most part explained by shifting climatic conditions, as all Malian cotton is grown under rainfed conditions. An additional factor is the ability of the CMDT to influence the level of production through the guaranteed price mechanism. As described above, CMDT is obligated to purchase cotton at the guaranteed price, but only within the production limits agreed with representatives of cotton producers. By restricting production, CMDT has thus been able to effectively contain losses in years when international cotton prices were not sufficient to generate profits at the going exchange rate.

As noted above, cotton production in Mali is, for the most part, centered in five regions, where it coexists with subsistence farming. On average, areas under cotton cultivation represent less than 30 percent of total cultivated area, as farmers continue to give priority to food production, and particularly cereals. Production techniques are still very labor intensive, requiring a high ratio of active personnel to total output (see ^{Table 5}). Only 20 percent of the nearly 110,000 Malian farms involved in cotton production are considered to be fully equipped (i.e., owning at least one ox-drawn plough and two pairs of oxen), while about 30 percent have no equipment other than hand-tools. The average size of cotton farms is about 10 hectares and average yields are about 1.2 tons per hectare. Size and yields vary, however, with the degree of equipment of farms. Fully equipped farms (Type A) average yields of 1.5 tons/ha, while those of moderately equipped farms (Type B) and of manual farms (Type C) do not exceed 1.3 tons and 1.1 tons per hectare, respectively. Similarly, the size of Type A farms, on average, is close to 20 hectares, while Type B and Type C farms generally do not exceed 12 and 5 hectares, respectively. These disparities in size and yields are reflected in significant differences in income levels.

4. Impact of the devaluation

The devaluation of the CFA franc in January 1994 had a significant, positive impact on the profitability of Mali’s cotton sector. With respect to producers, the increases in producer prices and the premiums distributed under the profit-sharing system more than offset the increase in the costs of imported inputs, resulting in increases in net income. Pre-devaluation net income per person, which averaged CFAF 10,943 for Type A farms against CFAF 7,100 for Type B farms and CFAF 5,335 for Type C farms, has been estimated to have increased by almost 25 percent for Type A farms, and 20 percent and 14 percent for Type B and Type C farms, respectively (see ^{Tables 6A}–^6C). The larger increase in the income of better equipped farms has widened the income disparities between small and large farmers. Specifically, the post-devaluation income level of small farmers is estimated to be equivalent to 44 percent of that of Type A farms, compared with 49 percent before the devaluation, mainly reflecting the higher share of imported inputs in unmechanized farms and the correspondingly higher increase in production costs experienced by this type of farms. For all categories of farms, however, increases in net income were insufficient to fully compensate for increases in prices levels as measured by the Consumer Price Index (CPI) for Bamako, which increased by 32 percent in 1995 on an end-of-period basis.

CMDT’s financial situation was significantly improved as a direct result of the devaluation and is reflected in the evolution of its profits for the three crop years to 1996 (^{Table 3}). However, these results, which contrast sharply with the series of deficits experienced prior to the devaluation, also reflect the impact of exceptionally favorable international prices and weather conditions. While markedly strengthened, the financial situation of CMDT remains vulnerable to sharp variations in international prices for cotton and the vagaries of weather conditions typical to the Sahel region.

5. Conclusion

Mali’s potential as a cotton producer is significant. As a result of the 1994 devaluation, the profitability of cotton farming increased substantially. The improvement in the level of cotton farmers’ income should strongly contribute further to the development of Mali’s cotton potential. Key medium-term objectives should aim at: (a) the development of new arable lands in new areas, as well as traditional cotton-growing areas; (b) an increase in the share of cotton in total cultivated areas; and (c) an increase in yields per hectare, which have tended to lag behind those experienced in the rest of the world. As indicated by the financial results of better equipped farms, the use of modern farming techniques translates into significant improvements in income levels, compared with those of traditional farming. However, even Mali’s more modern techniques of production remain rudimentary by international standards, and the scope for improvement in yields would appear substantial. Rapid progress in this direction will require the maintenance of reliable payment and remuneration mechanisms as provided for under the current arrangements. But it will also require more forceful efforts to raise educational levels of farmers and to improve access to appropriate sources of financing for medium- and long-term investment. Finally, greater attention will also need to be given to environmental issues, as fewer than 10 percent of farms are implementing a consistent program of land preservation.

Table 1.

Mali: Economic Indicators of the Cotton Sector, 1991–96

(In billions of CFA francs, unless indicated otherwise)

Sources: Malian authorities; and staff estimates.

Table 1.

Mali: Economic Indicators of the Cotton Sector, 1991–96

(In billions of CFA francs, unless indicated otherwise)

		1991	1992	1993	1994	1995	1996
Exports of cotton		48.9	37.8	39.2	39.4	79.7	126.9
	(in percent of total exports)	46.7	39.5	39.6	21.3	34.0	51.0
Taxes from cotton sector		0.9	—	—	12.0	16.4	20.5
	(in percent of total budget revenue)	1.0	—	—	9.5	10.2	11.3
Producers sales of cotton		25.4	25.8	27.2	23.4	38.1	62.6
	(in terms of government wage bill)	59.9	62.2	66.5	52.6	79.4	123.7
Cotton production as a percentage of GDP		7.5	7.0	7.6	6.3	7.1	8.1
Memorandum items:
	Total exports	104.6	95.8	98.9	185.0	234.7	248.9
	Total budget revenue	96.3	89.1	94.0	126.0	160.7	181.4
	Government wage bill	42.4	41.5	40.9	44.5	48.0	50.6
	Nominal GDP	682.1	753.5	755.1	1,028.7	1,231.3	1,357.7
	Real GDP	655.2	710.1	693.3	709.1	754.4	784.8
	Value added of cotton	49.4	49.4	52.9	44.4	53.2	63.8

Sources: Malian authorities; and staff estimates.

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Table 1.

Mali: Economic Indicators of the Cotton Sector, 1991–96

(In billions of CFA francs, unless indicated otherwise)

		1991	1992	1993	1994	1995	1996
Exports of cotton		48.9	37.8	39.2	39.4	79.7	126.9
	(in percent of total exports)	46.7	39.5	39.6	21.3	34.0	51.0
Taxes from cotton sector		0.9	—	—	12.0	16.4	20.5
	(in percent of total budget revenue)	1.0	—	—	9.5	10.2	11.3
Producers sales of cotton		25.4	25.8	27.2	23.4	38.1	62.6
	(in terms of government wage bill)	59.9	62.2	66.5	52.6	79.4	123.7
Cotton production as a percentage of GDP		7.5	7.0	7.6	6.3	7.1	8.1
Memorandum items:
	Total exports	104.6	95.8	98.9	185.0	234.7	248.9
	Total budget revenue	96.3	89.1	94.0	126.0	160.7	181.4
	Government wage bill	42.4	41.5	40.9	44.5	48.0	50.6
	Nominal GDP	682.1	753.5	755.1	1,028.7	1,231.3	1,357.7
	Real GDP	655.2	710.1	693.3	709.1	754.4	784.8
	Value added of cotton	49.4	49.4	52.9	44.4	53.2	63.8

Sources: Malian authorities; and staff estimates.

Table 2.

Mali: CMDT’s Cost Structure, 1990–96 ^1/

(In CFA francs per kilogram, unless otherwise indicated)

Source: Compagnie Malienne pour le Développement des Textiles (CMDT).

^1/Data reported on CMDT’s financial year, October to September.

^2/Excluding premium to producers.

^3/Office de la Haute Vallee du Niger.

Table 2.

Mali: CMDT’s Cost Structure, 1990–96 ^1/

(In CFA francs per kilogram, unless otherwise indicated)

				1990	1991	1992	1993	1994	1995	1996
Producer price 2/				84.8	84.9	84.8	84.1	84.9	124.4	125.0
Marketing costs				13.3	9.4	8.1	8.8	9.1	9.4	13.8
Road maintenance				0.2	0.3	0.1	0.1	1.5	2.3	1.1
Interest costs				0.3	0.8	1.1	0.9	2.7	2.5	3.4
Exchange losses				—	—	—	—	18.5	5.1	—
Dividend to Government				1.2	1.0	1.0	0.8	—	—	—
Compagnie Francaise pour le Developpement des Textiles				1.5	1.4	1.3	0.6	2.5	1.1	0.9
Rural development				6.6	8.7	7.1	5.3	7.9	14.6	16.5
Overhead costs				5.8	8.7	8.8	5.6	10.1	9.2	9.0
Seed cotton cost				113.7	115.2	112.3	106.3	137.1	168.6	169.8
Ginned cotton cost equivalent				266.0	277.3	267.2	251.9	327.9	385.3	405.5
Ginning				43.3	56.2	55.7	51.7	87.1	70.1	113.1
Insurance				1.1	0.7	1.1	1.2	1.5	1.6	0.9
Interest on crop credits				12.1	7.8	9.4	6.5	1.5	2.6	2.9
Storage				3.3	3.0	2.8	2.9	3.3	4.5	4.1
Ginned cotton cost				325.7	344.9	336.1	314.2	421.3	464.1	526.5
FOB costs				42.7	42.4	49.1	45.0	56.5	63.4	63.7
FOB price				368.4	387.4	385.3	359.2	477.8	527.6	590.2
Freight				25.2	34.4	31.9	32.2	56.3	66.2	69.2
CIF price				393.6	421.8	417.1	391.4	534.1	593.7	659.3
Memorandum items (in tons):
	CMDT production			219,525	264,142	261,082	307,234	229,338	277,166	390,088
	OHVN 3/			11,272	11,875	11,318	12,190	10,905	15,855	15,851
	Total			230,797	276,017	272,400	319,424	240,243	293,021	405,939
	Ginned quantities			230,917	275,929	272,190	319,424	240,558	292,676	404,262
	Yield			42.7	41.5	42.0	42.2	41.8	43.8	41.9
	Ginned cotton			98,694	114,646	114,414	134,754	100,613	128,090	169,313
	CIF price - cotton equivalent
		producer price		195.2	217.5	215.3	192.1	331.0	309.5	360.8
		(in percent of cotton equivalent producer
			price in terms of CIF price)	50.4	48.4	48.4	50.9	38.0	47.9	45.3
	Average export price of CMDT’s cotton (FOB basis)			460	423.8	340.7	295.3	746.1	856.8	862.8
	Margin of CMDT’s price over international price
		(in CFA francs)		91.6	36.4	-44.6	-63.9	268.3	329.2	272.6
		(in percent of CMDT’s costs (FOB basis))		24.9	9.4	-11.6	-17.8	56.2	62.4	46.2

Source: Compagnie Malienne pour le Développement des Textiles (CMDT).

^1/Data reported on CMDT’s financial year, October to September.

^2/Excluding premium to producers.

^3/Office de la Haute Vallee du Niger.

View Table

Table 2.

Mali: CMDT’s Cost Structure, 1990–96 ^1/

(In CFA francs per kilogram, unless otherwise indicated)

				1990	1991	1992	1993	1994	1995	1996
Producer price 2/				84.8	84.9	84.8	84.1	84.9	124.4	125.0
Marketing costs				13.3	9.4	8.1	8.8	9.1	9.4	13.8
Road maintenance				0.2	0.3	0.1	0.1	1.5	2.3	1.1
Interest costs				0.3	0.8	1.1	0.9	2.7	2.5	3.4
Exchange losses				—	—	—	—	18.5	5.1	—
Dividend to Government				1.2	1.0	1.0	0.8	—	—	—
Compagnie Francaise pour le Developpement des Textiles				1.5	1.4	1.3	0.6	2.5	1.1	0.9
Rural development				6.6	8.7	7.1	5.3	7.9	14.6	16.5
Overhead costs				5.8	8.7	8.8	5.6	10.1	9.2	9.0
Seed cotton cost				113.7	115.2	112.3	106.3	137.1	168.6	169.8
Ginned cotton cost equivalent				266.0	277.3	267.2	251.9	327.9	385.3	405.5
Ginning				43.3	56.2	55.7	51.7	87.1	70.1	113.1
Insurance				1.1	0.7	1.1	1.2	1.5	1.6	0.9
Interest on crop credits				12.1	7.8	9.4	6.5	1.5	2.6	2.9
Storage				3.3	3.0	2.8	2.9	3.3	4.5	4.1
Ginned cotton cost				325.7	344.9	336.1	314.2	421.3	464.1	526.5
FOB costs				42.7	42.4	49.1	45.0	56.5	63.4	63.7
FOB price				368.4	387.4	385.3	359.2	477.8	527.6	590.2
Freight				25.2	34.4	31.9	32.2	56.3	66.2	69.2
CIF price				393.6	421.8	417.1	391.4	534.1	593.7	659.3
Memorandum items (in tons):
	CMDT production			219,525	264,142	261,082	307,234	229,338	277,166	390,088
	OHVN 3/			11,272	11,875	11,318	12,190	10,905	15,855	15,851
	Total			230,797	276,017	272,400	319,424	240,243	293,021	405,939
	Ginned quantities			230,917	275,929	272,190	319,424	240,558	292,676	404,262
	Yield			42.7	41.5	42.0	42.2	41.8	43.8	41.9
	Ginned cotton			98,694	114,646	114,414	134,754	100,613	128,090	169,313
	CIF price - cotton equivalent
		producer price		195.2	217.5	215.3	192.1	331.0	309.5	360.8
		(in percent of cotton equivalent producer
			price in terms of CIF price)	50.4	48.4	48.4	50.9	38.0	47.9	45.3
	Average export price of CMDT’s cotton (FOB basis)			460	423.8	340.7	295.3	746.1	856.8	862.8
	Margin of CMDT’s price over international price
		(in CFA francs)		91.6	36.4	-44.6	-63.9	268.3	329.2	272.6
		(in percent of CMDT’s costs (FOB basis))		24.9	9.4	-11.6	-17.8	56.2	62.4	46.2

Source: Compagnie Malienne pour le Développement des Textiles (CMDT).

^1/Data reported on CMDT’s financial year, October to September.

^2/Excluding premium to producers.

^3/Office de la Haute Vallee du Niger.

Table 3.

Mali: CMDT Financial Results, 1992–94

(In billions of CFA francs)

Source: Compagnie Malienne pour le Développement des Textiles.

Table 3.

Mali: CMDT Financial Results, 1992–94

(In billions of CFA francs)

		1992	1993	1994
Purchases		22.2	25.9	19.5
Marketing costs		2.1	2.7	2.8
Road maintenance		0.0	0.0	0.3
Interest payments		0.3	0.3	0.6
Exchange losses		0.0	0.0	0.0
Dividend to Government		0.3	0.3	0.0
CFDT 1/		0.3	0.2	0.7
Rural development		1.9	1.6	1.9
Overhead costs		2.3	1.8	2.3
Other		1.3	1.3	1.3
Total 1		30.6	34.0	29.3
	Ginning	6.1	6.8	7.4
	Insurance	0.1	0.2	0.2
	Interest on crop credits	1.1	0.9	0.3
	Storage	0.6	0.6	0.6
Total 2		38.5	42.3	37.8
	FOB costs	5.2	4.9	5.6
	CIF costs	3.0	3.5	5.7
Total costs		46.7	50.8	49.1
	Sales	43.0	42.8	78.3
	Profit (loss = -)	-3.7	-7.9	29.2

Source: Compagnie Malienne pour le Développement des Textiles.

View Table

Table 3.

Mali: CMDT Financial Results, 1992–94

(In billions of CFA francs)

		1992	1993	1994
Purchases		22.2	25.9	19.5
Marketing costs		2.1	2.7	2.8
Road maintenance		0.0	0.0	0.3
Interest payments		0.3	0.3	0.6
Exchange losses		0.0	0.0	0.0
Dividend to Government		0.3	0.3	0.0
CFDT 1/		0.3	0.2	0.7
Rural development		1.9	1.6	1.9
Overhead costs		2.3	1.8	2.3
Other		1.3	1.3	1.3
Total 1		30.6	34.0	29.3
	Ginning	6.1	6.8	7.4
	Insurance	0.1	0.2	0.2
	Interest on crop credits	1.1	0.9	0.3
	Storage	0.6	0.6	0.6
Total 2		38.5	42.3	37.8
	FOB costs	5.2	4.9	5.6
	CIF costs	3.0	3.5	5.7
Total costs		46.7	50.8	49.1
	Sales	43.0	42.8	78.3
	Profit (loss = -)	-3.7	-7.9	29.2

Source: Compagnie Malienne pour le Développement des Textiles.

Table 4.

Mali: Cotton Farmers’ Income, 1990–96 ^1/

(In thousands of CFA francs)

Source: Compagnie Malienne pour le Développement des Textiles (CMDT).

^1/Data reported on CMDT’s financial year, October to September.

Table 4.

Mali: Cotton Farmers’ Income, 1990–96 ^1/

(In thousands of CFA francs)

		1990	1991	1992	1993	1994	1995	1996
Income
	Yield per hectare	1,230.0	1,360.0	1,275.0	1,310.0	1,195.0	1,085.0	1,215.0
	Producer price per kilogram	85.0	93.0	95.0	85.0	97.5	130.0	155.0
	Income per hectare	104.6	126.5	121.1	111.4	116.5	141.1	188.3
Operating expenses
	Fertilizer per hectare	18.3	14.5	14.5	13.2	12.7	16.5	22.3
	Urea per hectare	6.8	4.9	5.0	4.8	4.4	6.2	8.1
	Insecticide per hectare	12.0	16.9	15.6	14.3	14.3	15.6	13.2
	Other	0.5	0.5	0.5	0.5	0.5	0.8	0.8
	Equipment amortization	14.6	18.4	18.4	18.4	18.4	32.2	40.2
	Maintenance	2.0	2.3	2.3	2.3	2.3	2.5	2.5
	Hand tools	0.5	0.5	0.5	0.7	0.7	1.0	1.0
	Net income per hectare	49.8	68.5	64.3	57.2	63.3	66.3	100.3
	Net real income per hectare (1990 prices)	49.8	72.0	70.5	62.5	52.3	50.2	73.1
	Percentage change in real net income per hectare	—	44.5	-2.0	-11.4	-16.3	-4.1	45.5
Memorandum items:
	Production (tons)	229,528	273,512	272,190	319,625	240,252	293,021	405,939
	Area cultivated (hectares)	186,608	201,112	213,482	243,989	201,048	270,065	334,106
	CPI index(1987 = 100)	112.74	107.31	102.82	103.24	136.32	148.8	154.75

Source: Compagnie Malienne pour le Développement des Textiles (CMDT).

^1/Data reported on CMDT’s financial year, October to September.

View Table

Table 4.

Mali: Cotton Farmers’ Income, 1990–96 ^1/

(In thousands of CFA francs)

		1990	1991	1992	1993	1994	1995	1996
Income
	Yield per hectare	1,230.0	1,360.0	1,275.0	1,310.0	1,195.0	1,085.0	1,215.0
	Producer price per kilogram	85.0	93.0	95.0	85.0	97.5	130.0	155.0
	Income per hectare	104.6	126.5	121.1	111.4	116.5	141.1	188.3
Operating expenses
	Fertilizer per hectare	18.3	14.5	14.5	13.2	12.7	16.5	22.3
	Urea per hectare	6.8	4.9	5.0	4.8	4.4	6.2	8.1
	Insecticide per hectare	12.0	16.9	15.6	14.3	14.3	15.6	13.2
	Other	0.5	0.5	0.5	0.5	0.5	0.8	0.8
	Equipment amortization	14.6	18.4	18.4	18.4	18.4	32.2	40.2
	Maintenance	2.0	2.3	2.3	2.3	2.3	2.5	2.5
	Hand tools	0.5	0.5	0.5	0.7	0.7	1.0	1.0
	Net income per hectare	49.8	68.5	64.3	57.2	63.3	66.3	100.3
	Net real income per hectare (1990 prices)	49.8	72.0	70.5	62.5	52.3	50.2	73.1
	Percentage change in real net income per hectare	—	44.5	-2.0	-11.4	-16.3	-4.1	45.5
Memorandum items:
	Production (tons)	229,528	273,512	272,190	319,625	240,252	293,021	405,939
	Area cultivated (hectares)	186,608	201,112	213,482	243,989	201,048	270,065	334,106
	CPI index(1987 = 100)	112.74	107.31	102.82	103.24	136.32	148.8	154.75

Source: Compagnie Malienne pour le Développement des Textiles (CMDT).

^1/Data reported on CMDT’s financial year, October to September.

Table 5.

Mali: Cotton Farm Indicators ^1/

Source: Compagnie Malienne pour le Développement des Textiles (CMDT).

^1/Type A: fully equipped farms; Type B: partly equipped farms; Type C: unmechanized farms.

Table 5.

Mali: Cotton Farm Indicators ^1/

			Type A	Type B	Type C
Percentage of farms using external labor force			62	53	50
Percentage of farms using anti-erosion techniques			8	6	6
Percentage of farms owning:
		Oxen	100	99	35
		Goats	82	50	21
		Donkeys	82	45	9
Cultivated area per hectare			19	12	5
Cultivated area per working person			2	2	1
Share of cotton in cultivated area			27	23	23
Average number of individuals living on the farm			35	20	9
	Of which: working		(12)	(6)	(4)
Yields per hectare:
	Cotton		1514	1266	1036
	Cereals		1062	989	770
	Groundnuts		729	623	550

Source: Compagnie Malienne pour le Développement des Textiles (CMDT).

^1/Type A: fully equipped farms; Type B: partly equipped farms; Type C: unmechanized farms.

View Table

Table 5.

Mali: Cotton Farm Indicators ^1/

			Type A	Type B	Type C
Percentage of farms using external labor force			62	53	50
Percentage of farms using anti-erosion techniques			8	6	6
Percentage of farms owning:
		Oxen	100	99	35
		Goats	82	50	21
		Donkeys	82	45	9
Cultivated area per hectare			19	12	5
Cultivated area per working person			2	2	1
Share of cotton in cultivated area			27	23	23
Average number of individuals living on the farm			35	20	9
	Of which: working		(12)	(6)	(4)
Yields per hectare:
	Cotton		1514	1266	1036
	Cereals		1062	989	770
	Groundnuts		729	623	550

Source: Compagnie Malienne pour le Développement des Textiles (CMDT).

^1/Type A: fully equipped farms; Type B: partly equipped farms; Type C: unmechanized farms.

Table 6A.

Mali: Devaluation Effects on Farmers’ Income ^1/

Cotton producers’ financial results Fully equipped farm (Type A)

Source: Compagnie Malienne pour le Développement des Textiles (CMDT).

^1/In CFA francs.

Table 6A.

Mali: Devaluation Effects on Farmers’ Income ^1/

Cotton producers’ financial results Fully equipped farm (Type A)

		Before devaluation					After devaluation					Net increase
		Cereals	Cotton	Other	Total		Cereals	Cotton	Other	Total		Cereals	Cotton	Other	Total
Expenditures		104,455	318,645	5,006	428,106		135,188	492,439	6,890	634,517		30,733	173,794	1,884	206,411
Chemicals		46,462	185,052	—	231,514		57,365	315,134	—	372,499		10,903	130,062	—	140,985
Maintenance		30,759	13,780	2,461	47,000		39,987	17,914	3,199	61,100		9,228	4,134	738	14,100
Hand tools		6,250	2,800	500	9,550		8,125	3,640	650	12,415		1,875	840	150	2,865
Wages		—	28,000	—	28,000		—	36,400	—	36,400		—	8,400	—	8,400
Interest		2,111	8,954	206	11,271		3,008	12,082	308	15,398		897	3,128	102	4,127
Amortization		18,873	80,059	1,839	100,771		26,703	107,269	2,733	136,705		7,830	27,210	894	35,934
Income		151,914	644,401	14,805	811,120		217,020	871,791	22,208	1,111,019		65,106	227,390	7,403	299,899
Sales/hectare		12,153	115,072	14,805	142,030		17,362	155,677	22,208	195,247		5,208	40,605	7,403	53,217
Sales/person		4,340	18,411	423	23,175		6,201	24,908	635	31,743		1,860	6,497	212	8,569
Gross income		66,332	405,815	11,638	483,785		108,535	486,621	18,051	613,207		42,203	80,806	6,413	129,422
Gross income/hectare		5,307	72,467	11,638	89,412		8,683	86,897	18,051	113,630		3,376	14,430	6,413	24,219
Gross income/person		1,895	11,595	333	13,822		3,101	13,903	516	17,520		1,206	2,309	183	3,698
Net income		47,459	325,756	9,799	383,014		81,832	379,352	15,318	476,502		34,373	53,596	5,519	93,488
Net income/hectare		3,797	58,171	9,799	71,766		6,547	67,741	15,318	89,606		2,750	9,571	5,519	17,840
Net income/person		1,356	9,307	280	10,943		2,338	10,839	438	13,614		982	1,531	158	2,671
Memorandum items;
	Cultivated area(ha)	13	6	1	19		13	6	1	19
	Yield/hectare	1,062	1,514	729			1,062	1,514	729
	Production (kg) Number of persons living	13.275	8,478	729			13,275	8,478	729
	on the farm				35					35

Source: Compagnie Malienne pour le Développement des Textiles (CMDT).

^1/In CFA francs.

View Table

Table 6A.

Mali: Devaluation Effects on Farmers’ Income ^1/

Cotton producers’ financial results Fully equipped farm (Type A)

		Before devaluation					After devaluation					Net increase
		Cereals	Cotton	Other	Total		Cereals	Cotton	Other	Total		Cereals	Cotton	Other	Total
Expenditures		104,455	318,645	5,006	428,106		135,188	492,439	6,890	634,517		30,733	173,794	1,884	206,411
Chemicals		46,462	185,052	—	231,514		57,365	315,134	—	372,499		10,903	130,062	—	140,985
Maintenance		30,759	13,780	2,461	47,000		39,987	17,914	3,199	61,100		9,228	4,134	738	14,100
Hand tools		6,250	2,800	500	9,550		8,125	3,640	650	12,415		1,875	840	150	2,865
Wages		—	28,000	—	28,000		—	36,400	—	36,400		—	8,400	—	8,400
Interest		2,111	8,954	206	11,271		3,008	12,082	308	15,398		897	3,128	102	4,127
Amortization		18,873	80,059	1,839	100,771		26,703	107,269	2,733	136,705		7,830	27,210	894	35,934
Income		151,914	644,401	14,805	811,120		217,020	871,791	22,208	1,111,019		65,106	227,390	7,403	299,899
Sales/hectare		12,153	115,072	14,805	142,030		17,362	155,677	22,208	195,247		5,208	40,605	7,403	53,217
Sales/person		4,340	18,411	423	23,175		6,201	24,908	635	31,743		1,860	6,497	212	8,569
Gross income		66,332	405,815	11,638	483,785		108,535	486,621	18,051	613,207		42,203	80,806	6,413	129,422
Gross income/hectare		5,307	72,467	11,638	89,412		8,683	86,897	18,051	113,630		3,376	14,430	6,413	24,219
Gross income/person		1,895	11,595	333	13,822		3,101	13,903	516	17,520		1,206	2,309	183	3,698
Net income		47,459	325,756	9,799	383,014		81,832	379,352	15,318	476,502		34,373	53,596	5,519	93,488
Net income/hectare		3,797	58,171	9,799	71,766		6,547	67,741	15,318	89,606		2,750	9,571	5,519	17,840
Net income/person		1,356	9,307	280	10,943		2,338	10,839	438	13,614		982	1,531	158	2,671
Memorandum items;
	Cultivated area(ha)	13	6	1	19		13	6	1	19
	Yield/hectare	1,062	1,514	729			1,062	1,514	729
	Production (kg) Number of persons living	13.275	8,478	729			13,275	8,478	729
	on the farm				35					35

Source: Compagnie Malienne pour le Développement des Textiles (CMDT).

^1/In CFA francs.