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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 have helped the country achieve strong economic growth despite the recent external shocks of the Covid-19 pandemic and the war in Ukraine. After reaching 7.2% in 2021, GDP growth remained resilient in 2022, slowing down to 5.7% (IMF). Economic growth is expected to accelerate to 6.2% in 2023 and 6% in 2024, driven by agroindustry, construction, and port-related activity (IMF). Higher infrastructure spending and a wider regional recovery will support activity (The Economist Intelligence Unit).

In 2022, despite a challenging global and regional context, Benin’s economy remained resilient, supported by
a strong investment push. Investments in the electricity grid and freight transport have driven growth (Coface). In July 2022, a blended 42-month Extended Fund Facility and Extended Credit Facility was approved by the IMF to help Benin address financing needs, support the country’s National Development Plan centered on achieving the Sustainable Development Goals (SDGs), and catalyze donor support (IMF). Reflecting the spillovers of the war in Ukraine, inflation increased from 1.7% in 2021 to 5% in 2022, but remained subdued owing to a strong harvest season and subsidy measures adopted by the government (IMF). Households have benefited from subsidies on agricultural inputs and fuels, as well as from tariff reductions (Coface). According to IMF forecast, inflation is expected to decrease to 1.8% in 2023 and 2% in 2024. Budget deficit decreased only slightly, from -5.7% GDP in 2021 to -5.5% GDP in 2022, as policy remained accommodative to cushion the impact of the repeated shocks (IMF). Consolidation efforts are scheduled to resume in 2023, with a forecast budget balance of -4.3% GDP (IMF). Public debt increased from 49.9% GDP in 2021 to 54.8% GDP in 2022, and it is expected to slowly decrease to 55.6% GDP in 2023 and 54.3% GDP in 2024 (IMF). Public debt is divided equally between multilateral loans, external obligations and domestic obligations and it should stabilise thanks to continued fiscal consolidation and growth (Coface). Around 20% higher than the previous one, the 2023 Budget resumed the consolidation of public finances while allocating substantial resources to critical social and security-related spending. The priorities remain 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.

Despite many efforts to reduce it, the poverty rate remains as high as 38.5% according to World Bank data. In 2021, the unemployment rate in the country was estimated at 1.8% (ILO estimate). However, underemployment rate stood at more than 70%, and informal employment rate at more than 90% (World Bank).

 
Main Indicators 20222023 (E)2024 (E)2025 (E)2026 (E)
GDP (billions USD) 17.4419.9421.7923.6325.59
GDP (Constant Prices, Annual % Change) 6.35.56.36.06.0
GDP per Capita (USD) 1,3031,4491,5401,6241,711
General Government Gross Debt (in % of GDP) 54.253.052.451.450.5
Inflation Rate (%) n/a5.02.52.02.0
Current Account (billions USD) -0.98-1.19-1.24-1.22-1.25
Current Account (in % of GDP) -5.6-6.0-5.7-5.2-4.9

Source: IMF – World Economic Outlook Database , October 2021

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 29.4% 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 export of raw cashew nuts will be banned in 2024 to promote local processing (Coface).

The industrial sector contributes 17% 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 47.3% 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) 28.1 22.5 49.3
Value Added (in % of GDP) 26.9 17.0 46.9
Value Added (Annual % Change) 4.8 7.9 6.0

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 63% 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 (61% of total exports), cashew nut, coconut, Brazilian nuts, shea nuts, petroleum products, cement, gold, textile products, and seafood to Bangladesh, India, China, Vietnam, Chad, Niger and Egypt. Its main imports are food products (rice, meat, frozen fish), oil products, drugs, vehicles and capital goods from India, China, France, Belgium, Togo, the United Arab Emirates and Turkey. It is also quite active in re-exportation, from Nigeria mainly.

For years now, Benin has had a structural trade deficit. In 2021, the trade deficit in goods amounted to USD 888 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 2021, Benin exported goods with a total value of USD 3.4 billion while it imported goods worth USD 4.3 billion. Concerning services, Benin exported USD 555 million worth of services in 2021 and imported USD 984 million worth of services (WTO). In 2022, net imports deteriorated due to the post-pandemic reduction in shortages, food and energy inflation, and the depreciation of the CFA franc against the dollar (Coface).

 
Foreign Trade Values 20182019202020212022
Imports of Goods (million USD) 4,3753,9323,5554,3704,784
Exports of Goods (million USD) 3,3443,0522,9963,4343,547
Imports of Services (million USD) 769806790931982
Exports of Services (million USD) 503528510512540

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

Foreign Trade Indicators 20182019202020212022
Foreign Trade (in % of GDP) 61.863.744.848.150.9
Trade Balance (million USD) -556-444-156-352n/a
Trade Balance (Including Service) (million USD) -821-722-436-772n/a
Imports of Goods and Services (Annual % Change) 4.83.4-19.816.818.5
Exports of Goods and Services (Annual % Change) 5.08.6-25.012.619.1
Imports of Goods and Services (in % of GDP) 34.534.125.027.129.3
Exports of Goods and Services (in % of GDP) 27.329.619.920.921.7

Source: World Bank ; Latest available data

Foreign Trade Forecasts 20232024 (e)2025 (e)2026 (e)2027 (e)
Volume of exports of goods and services (Annual % change) 23.314.211.511.09.8
Volume of imports of goods and services (Annual % change) 25.612.89.19.87.9

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)
2022
Bangladesh 45.3%
India 11.9%
China 6.1%
Egypt 4.5%
Pakistan 4.2%
See More Countries 28.0%
Main Suppliers
(% of Imports)
2022
India 15.7%
China 13.1%
France 8.1%
United Arab Emirates 6.7%
United States 4.5%
See More Countries 51.9%

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

Travel restrictions
Regularly updated travel information for all countries with regards to Covid-19 related entry regulations, flight bans, test and vaccines requirements is available on TravelDoc Infopage.
To find information about the current travel regulations, including health requirements, it is also advised to consult Travel Regulations Map provided and updated on a daily basis by IATA.
Import & export restrictions
A general overview of trade restrictions which were adopted by different countries during the COVID-19 pandemic is available on the International Trade Centre's COVID-19 Temporary Trade Measures webpage.
Economic recovery plan
For the general overview of the key economic policy responses to the COVID-19 pandemic (fiscal, monetary and macroeconomic) undertaken by the government of Benin, please consult the country's dedicated section in the IMF’s Policy Tracker platform.
Support plan for businesses
For an evaluation of impact of the Covid pandemic on SMEs and an inventory of country responses to foster SME resilience, refer to the OECD's SME Covid-19 Policy Responses document.
You can also consult the World Bank's Map of SME-Support Measures in Response to COVID-19.

 

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