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Economic Overview

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

Benin’s strong macroeconomic fundamentals helped the country achieve one of the strongest growth rates among developing countries in 2020 (3.8%), despite the Covid-19 pandemic. Economic growth recovered in 2021, reaching an estimated 5.5%, boosted by public investment and the normalization of merchandise traffic at the Port of Cotonou (IMF). According to the IMF estimates, GDP growth should further accelerate to 6.5% in 2022 and 2023. Official Beninese forecasts set economic growth to 7% in 2022 and 7.8% in 2023. Growing coffee and cashew nut output as well as renewed dynamism of Benin's major overseas trading partners will also boost economic growth (The Economist Intelligence Unit).

In 2021, Benin’s economy recovered from the slowdown induced by the coronavirus crisis, thanks to the government’s swift response, a strong public investment push and the establishment of a sanitary belt around the cities most exposed to the pandemic (IMF). To fight the coronavirus crisis, Benin’s government set a recovery plan estimated at FCFA 74 billion (1% of the country’s GDP), aimed toward the most vulnerable households, and the companies operating in the most affected sectors (tourism, transportation, etc.). The country also benefited from emergency financing (USD 178 million), and general SDR allocation (USD 168 million) from the IMF. Falling revenues and increased expenditures caused the public deficit to widen to 6.5% GDP in 2021 (Benin Ministry of Economy and Finance). Fiscal consolidation efforts are expected to reduce the deficit (grants included) to 4.5% GDP in 2022 and 3.5% GDP in 2023 (Benin Ministry of Economy and Finance). Public debt reached an estimated 52.3% GDP in 2021, and is projected to decrease to 48.9% GDP in 2022 and 46.3% GDP in 2023 (IMF). Aggregate inflation remained subdued (3% in 2020 and 2021) but food prices increased sharply, reflecting both global factors and domestic weather events (IMF). Inflation rate is expected to decrease to 2% in 2022 and 2023 (IMF). Beninese authorities have requested a new IMF-supported program to facilitate the implementation of the national development plan. Among the priorities of the 2022 budget are the promotion of high-potential sectors such as agriculture, tourism and digital economy; the development of key transport, energy and sanitation infrastructure; the reduction of poverty and social vulnerability; and fiscal consolidation. The authorities have also revamped their vaccination strategy, as less than 4% of the population was fully vaccinated at the end of 2021.

Despite many efforts to reduce it, the poverty rate remains as high as 45.9% according to World Bank data. In 2020, the unemployment rate in the country was estimated at 2.5% (ILO estimate). However, underemployment rate stood at more than 70%, and informal employment rate at more than 90% (World Bank). 

 
Main Indicators 201920202021 (e)2022 (e)2023 (e)
GDP (billions USD) 14.3915.67e18.0719.9221.84
GDP (Constant Prices, Annual % Change) 6.93.8e5.56.56.5
GDP per Capita (USD) 1,2181,2911,4471,5511,655
General Government Gross Debt (in % of GDP) 41.246.152.348.946.3
Inflation Rate (%) -0.93.0e3.02.02.0
Current Account (billions USD) -0.58-0.62-0.72-0.85-0.97
Current Account (in % of GDP) -4.0-3.9e-4.0-4.3-4.4

Source: IMF – World Economic Outlook Database , October 2021

Note: (e) Estimated Data

Country Risk

See the country risk analysis provided by La Coface.

 

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Main Sectors of Industry

Benin’s economy is heavily reliant on agriculture. This sector accounts for 27.1% of Benin’s GDP and employs an estimated 38% of the workforce (World Bank, latest data available). The country has a fertile land, and a third of Benin’s territory is suitable for agriculture (World Bank). Around half of the population rely on subsistence farming for their livelihood, whereas cotton is the main crop and the key export commodity. The cotton sector contributes to 40% of the GDP. Other cultivations include cashew nuts, corn, cassava, yams, beans, palm oil, and peanuts.

The industrial sector contributes 16.3% of GDP and gives employment to roughly 18% of the active population. Textiles, food processing, construction materials, and cement are the main sub-sectors.

Services (dominated by trade and transport) account for nearly 48% of Benin’s GDP and almost 43% of total employment.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 38.3 18.3 43.4
Value Added (in % of GDP) 27.1 16.3 47.9
Value Added (Annual % Change) 1.8 5.2 4.9

Source: World Bank - Latest available data.

 
Monetary Indicators 20162017201820192020
CFA Franc BCEAO (XOF) - Average Annual Exchange Rate For 1 USD 593.01582.09555.45586.00575.59

Source: World Bank - Latest available data.

 

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Foreign Trade

Benin is open to foreign trade which represents 45% of its GDP (World Bank). The country is a member of various trade organizations including the World Trade Organisation and the West African Economic and Monetary Union (WAEMU). The vast majority of its trade passes through the port of Cotonou, the capacity of which the government wants to develop.

Benin mainly exports cotton (53.4% of total exports), cashew nut, coconut, Brazilian nuts, shea nuts, petroleum products, cement, gold, textile products, and seafood to Bangladesh, India, China, Malaysia, Ukraine, Denmark, the United Arab Emirates and Vietnam. Its main imports are food products (rice, meat, frozen fish), oil products, energy, drugs, vehicles and capital goods from India, China, France, Togo, Belgium, Russia and Turkey. It is also quite active in re-exportation, from Nigeria mainly.

For years now, Benin has had a structural trade deficit. In 2020, the trade deficit in goods amounted to USD 947 million (WTO). This is mainly due to low exports which are largely made up of low-cost agricultural products, and the country’s heavy reliance on foreign countries for its oil and energy supply. According to WTO data, in 2020, Benin exported goods with a total value of USD 2.3 billion while it imported goods worth USD 3.3 billion. Concerning services, Benin exported USD 410 million worth of services in 2020 and imported USD 578 million worth of services.

 
Foreign Trade Values 20162017201820192020
Imports of Goods (million USD) 2,2513,4944,3753,9323,263
Exports of Goods (million USD) 1,3542,2163,3443,0522,316
Imports of Services (million USD) 712577762803578
Exports of Services (million USD) 382323485510410

Source: World Trade Organisation (WTO) ; Latest available data

Foreign Trade Indicators 20162017201820192020
Foreign Trade (in % of GDP) 59.061.561.863.744.8
Trade Balance (million USD) -111-344-556-449n/a
Trade Balance (Including Service) (million USD) -526-704-821-727n/a
Imports of Goods and Services (Annual % Change) 3.314.34.83.4-19.8
Exports of Goods and Services (Annual % Change) 13.57.05.08.6-25.0
Imports of Goods and Services (in % of GDP) 31.434.334.534.125.0
Exports of Goods and Services (in % of GDP) 27.627.227.329.619.9

Source: World Bank ; Latest available data

Foreign Trade Forecasts 20212022 (e)2023 (e)2024 (e)2025 (e)
Volume of exports of goods and services (Annual % change) 20.712.816.012.011.2
Volume of imports of goods and services (Annual % change) 16.913.014.511.911.2

Source: IMF, World Economic Outlook ; Latest available data

Note: (e) Estimated Data

 
International Economic Cooperation
Benin is a member of the WTO, the Economic Community Of West African States (ECOWAS), and the West African Economic and Monetary Union (UEMOA).
 

Main Partner Countries

Main Customers
(% of Exports)
2020
Bangladesh 38.5%
India 11.9%
China 6.6%
Malaysia 4.7%
Ukraine 4.7%
See More Countries 33.6%
Main Suppliers
(% of Imports)
2020
India 11.5%
China 11.2%
France 10.1%
Togo 8.4%
Belgium 6.3%
See More Countries 52.4%

Source: Comtrade, Latest Available Data

 

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Political Outline

Current Political Leaders
President: Patrice TALON (since 6 April 2016) - the president is both chief of state and head of government 
Next Election Dates
Presidential: April 2026
National Assembly: April 2023
Main Political Parties
Benin is formally a multy-party country, however opposition parties have no real chance of gaining power. The main parties are:

Alliance for a Triumphant Benin or ABT : leader Abdoulaye BIO TCHANE
African Movement for Development and Progress or MADEP : leader Sefou FAGBOHOUN
Benin Renaissance or RB : leader Lehady SOGLO
Cowrie Force for an Emerging Benin or FCBE : leader Yayi BONI
Democratic Renewal Party or PRD : leader Adrien HOUNGBEDJI
National Alliance for Development and Democracy or AND : leader Valentin Aditi HOUDE
New Consciousness Rally or NC : leader Pascal KOUPAKI
Patriotic Awakening or RP : leader Janvier YAHOUEDEOU
Social Democrat Party or PSD : leader Emmanuel GOLOU
Sun Alliance or AS : leader Sacca LAFIA
Union Makes the Nation or UN : leader Adrien HOUNGBEDJI (includes PRD, MADEP)
United Democratic Forces or FDU : leader Mathurin NAGO
Executive Power
The President of the Republic is elected for a five-year term by universal suffrage with uninominal majority ballot in two rounds, for maximum two terms (whether consecutive or not). He is the head of state, the holder of the executive power, the head of the Government, and with this title he shall determine and conduct the politics of the nation (art. 54). After an advisory opinion of the National Assembly, the President appoints the members of the Government.
Legislative Power
The legislative power in Benin is vested in the parliament, which is composed of a single chamber called the National Assembly. It is composed of 83 deputies elected every four years by proportional representation in 24 multi-member constituencies.
 

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COVID-19 Country Response

COVID-19 epidemic evolution
To find out about the latest status of the COVID19 pandemic evolution and the most up-to-date statistics on the COVID19 disease in Benin, please visit the Beninese government platform with the official data. The platform provides a daily epidemiological update, which includes key national figures.
For the international outlook you can consult the latest
situation reports published by the World Health Organisation as well as the global daily statistics on the coronavirus pandemic evolution including data on confirmed cases and deaths by country.
Sanitary measures
To find out about the latest public health situation in Benin and the current sanitary measures in vigour, please consult the Beninese government platform including the up-to-date information on the containment measures put in place and public health recommendations.
Travel restrictions
The COVID-19 situation, including the spread of new variants, evolves rapidly and differs from country to country. All travelers need to pay close attention to the conditions at their destination before traveling. Regularly updated information for all countries with regards to Covid-19 related travel restrictions in place including entry regulations, flight bans, test requirements and quarantine is available on TravelDoc Infopage.
It is also highly recommended to consult COVID-19 Travel Regulations Map provided and updated on the daily basis by IATA.
The US government website of Centers of Disease Control and Prevention provides COVID-19 Travel Recommendations by Destination.

The UK Foreign travel advice also provides travelling abroad advice for all countries, including the latest information on coronavirus, safety and security, entry requirements and travel warnings.
Import & export restrictions
So far, no restrictions have been imposed on imports or exports in the Republic of Benin. For information on all the measures applicable to movement of goods during the period of sanitary emergency due to the COVID-19 outbreak (including eventual import and export restrictions, if applicable), please consult the Beninese government platform.
For a general overview of trade restrictions due to COVID-19 pandemic, please consult the section dedicated to Benin on the International Trade Centre's COVID-19 Temporary Trade Measures webpage.c
Economic recovery plan
So far, no information on the economic recovery plan to deal with the consequences of the COVID19 pandemic on the Beninese economy has been published on the official websites of the Beninese government.
For a general overview of the main economic policy measures (fiscal, monetary and macroeconomic) taken by the Beninese government to limit the socio-economic impact of the COVID-19 pandemic, please consult the section dedicated to Benin in the IMF’s Policy Tracker platform.
Support plan for businesses
The country's official sources do not provide information on specific business support programmes following the coronavirus epidemic outbreak.
For a general overview of international SME support policies in response to the COVID-19 epidemic, please refer to the World Bank's Map of SME-Support Measures in Response to COVID-19.
Support plan for exporters
The country's government official sources do not provide information with regards to specific schemes for exporting companies following the coronavirus epidemic outbreak.
 

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