Malian workers feel the pressure as sanctions set in

  • Economy under pressure as Mali defaults on debt
  • Sanctions result in mass layoffs, loss of business
  • Ordinary workers feel the pressure

BAMAKO, Feb 21 (Reuters) – Mohamed Cisse employed hundreds of workers in Mali’s capital Bamako before last month’s economic sanctions closed borders and cut the blood off his construction company.

Cement is rare. Its key ingredient, clinker, comes from neighboring Senegal, from where all but essentials are blocked. Cissé was forced to close three of its four shipyards.

The Economic Community of West African States (ECOWAS) wanted to send a powerful message to Mali’s military leaders when it imposed the sanctions after the junta delayed plans to hold elections in February in following two coups.

Join now for FREE unlimited access to Reuters.com

Register

But workers, many of whom have so far backed the junta for ousting unpopular President Ibrahim Boubacar Keita in 2020, are worried about the disproportionate impact on ordinary citizens in one of the world’s poorest countries.

Hundreds are made redundant; goods destined for import are blocked in gigantic traffic jams at border crossings; cotton and gold, major economic engines, do not reach regional buyers. Read more

The success of sanctions in forcing Mali’s leaders to hold elections sooner, or if they reduce support for the junta, could influence how ECOWAS seeks to punish other putschists in Guinea and Burkina Faso who have also seized power in the past year.

“We had a lot of hope when we saw these well-trained, well-structured soldiers. But the situation of this embargo, I would say that it is… 70% the fault of the government, which presented an imprecise (election ) schedule,” Cissé said.

The junta-appointed caretaker government did not respond to requests for comment. He had previously said the sanctions were “disproportionate, inhumane, illegitimate and illegal” and will have serious consequences for the population. Read more

ECOWAS says it is imposing the sanctions because Mali’s leaders have said they will delay elections until December 2025, nearly four years later than they originally agreed.

CLAMP FITTING

Malians are used to poverty. A decade-old Islamist insurgency has taken over parts of the north and center, killing thousands. The COVID-19 pandemic has contributed to an increase in the cost of fuel and other goods.

But now the economy is under severe strain. Mali has defaulted on payments of 54 billion CFA francs ($93 million) in interest and principal since January, according to data from the West African monetary union’s debt agency Umoa-Titres.

The government says it is unable to meet its obligations because the sanctions have cut it off from regional financial markets.

“The border closure of landlocked Mali, in a country completely dependent on its coastal neighbors for trade, is nothing short of catastrophic,” said Eric Humphery-Smith, an analyst at consultancy Verisk Maplecroft.

Authorities need tax revenue to pay around $120 million in annual government salaries, said Modibo Mao Makalou, an economist and former adviser to ousted President Keita. But revenues, including customs duties and income taxes, are at risk, he said.

Remittances from the region, key to the economy, are also blocked as wire transfers and bank transfers fail to reach.

“I think (the government) can last 2-3 months maximum, but the noose has to be loosened,” Makalou said, referring to the remaining funds to be able to pay salaries and meet other expenses.

Although the impact has yet to be demonstrated in hard economic data, Malians are struggling.

Issiaka Mahmoud Bah, managing director of the recruitment firm Golden Resources Management based in Bamako, received CVs from around 25 candidates a day. It now has 100. Meanwhile, the number of employers looking for workers has plummeted, he said.

Revenue for Sonef, a transport company that ferries people from Mali across West Africa, has fallen 80% in recent weeks, company director Mamadou Traore said. His customers, including people transporting dyed fabrics to Ivory Coast or bringing in fish from Senegal, cannot travel, he said.

“We had to close several stopovers and put dozens of agents on technical unemployment,” he explained.

($1 = 582.7500 CFA francs)

Join now for FREE unlimited access to Reuters.com

Register

Writing by Edward McAllister Editing by Bate Felix and Alison Williams

Our standards: The Thomson Reuters Trust Principles.

Comments are closed.