Economic overview Benin, in 36 editions.

Benin is one of the least developed countries in the world because of limited natural resources and a poorly developed infrastructure. Agriculture accounts for almost 45% 40% of GDP, employs about 60% of the labor force, and generates a major share of foreign exchange earnings. The industrial sector contributes only about 15% to GDP and employs 2% of the work force. Persistently low prices in recent years have limited hard currency earnings from Benin's major exports of agricultural products and crude oil.

Benin is one of the least developed countries in the world because of
limited natural resources and a poorly developed infrastructure. Agriculture
accounts for almost 40% about 35% of GDP, employs about 60% of the labor force, and
generates a major share of foreign exchange earnings. The industrial sector
contributes only about 15% to GDP and employs 2% of the work force. Persistently low Low
prices in recent years have limited kept down hard currency earnings from Benin's
major exports of agricultural products and crude oil.

Benin is one of the least developed countries in the world because of
limited natural resources and a poorly developed infrastructure. Agriculture
Agriculture accounts for about 35% of GDP, employs about 60% of the
labor force, and
generates a major share of foreign exchange earnings.
The industrial sector
contributes only about 15% 10% to GDP and employs 2%
of the work force. Low
prices in recent years have kept down hard
currency earnings from Benin's
major exports of agricultural products products,
primarily cotton. A World Bank supported structural adjustment program
begun in 1989 has helped strengthen the economy through such measures
as trimming the government payroll, reforming the tax system, and crude oil.
encouraging private investment, both domestic and foreign. Benin has
experienced 3 consecutive years of moderate growth as a result.

The economy of Benin remains underdeveloped and
dependent on
subsistence agriculture, cotton production, and
regional trade. Growth
in real output has output, which had averaged a sound 4% in 1991-94 but this rate barely
exceeds the rapid in 1990-94, rose to 6% in 1995. Rapid population growth growth, now 3.3%
per year, offset much of 3.3%. this growth in output. Inflation jumped to 35%
55% in 1994 (compared to 3% in 1993) following the 50% currency
devaluation in January. January 1994, but subsided gradually in 1995.
Commercial and transport activities, which
make up almost 36% 37% of GDP, are
extremely vulnerable to developments in
Nigeria as evidenced by
decreased reexport trade in 1994 due to a
severe contraction in
Nigerian demand. The industrial sector accounts
for less than 10% of GDP and mainly produces foods, beverages, cement,
and textiles. Support by the Paris Club and official bilateral
creditors has eased the external debt situation in recent years. The
government, still burdened with money-losing state enterprises and a
bloated civil service, is has been gradually implementing a World Bank
supported structural adjustment program. program since 1991.

The economy of Benin remains underdeveloped and
dependent on subsistence agriculture, cotton production, and
regional
trade. Growth in real output, which had averaged a sound 4%
in 1990-94,
1990-95, rose to 6% 5.5% in 1995. 1996. Rapid population growth, now 3.3%
per year, growth offset much of
this growth in output. Inflation jumped to
55% in 1994 (compared to 3%
in 1993) following the 50% currency
devaluation in January 1994, but
has subsided gradually in 1995. over the past two years, with 14.5% inflation
in 1995 and a target of 4.5% inflation in 1996. Commercial and
transport activities, which make up 37% a large part of GDP, are
extremely
vulnerable to developments in Nigeria as evidenced by
decreased
reexport trade in 1994 due to a severe contraction in
Nigerian demand.
Support by the Paris Club and official bilateral
creditors has eased
the external debt situation in recent years. The
government, still
burdened with money-losing state enterprises and a
bloated civil
service, has been gradually implementing a World Bank
supported
structural adjustment program since 1991.

The economy of Benin remains underdeveloped and
dependent on subsistence agriculture, cotton production, and regional
trade. Growth in real output, which had averaged a sound 4% in during
1990-95, rose to 5.5% in 1996. 1996 and was targeted at 4.8% for 1997. Rapid
population growth offset much of
this growth in output. Inflation
jumped to 55% in 1994 (compared to 3%
in 1993) following the 50%
currency devaluation in January 1994, but
has subsided gradually over the past two
three years, with 14.5% inflation
in 1995 and a target of 4.5% 3.5% inflation in 1996. 1997. Commercial and
transport activities, which make up a large part of GDP, are extremely
vulnerable to developments in Nigeria as evidenced by decreased
reexport trade in 1994 due to a severe contraction in Nigerian demand. Nigeria, particularly fuel shortages.
Support by the Paris Club and official bilateral creditors has eased
the external debt situation in recent years. The government, still
burdened with money-losing state enterprises and a bloated civil
service, has been gradually implementing a World Bank supported
structural adjustment program since 1991.

The economy of Benin remains underdeveloped and
dependent on subsistence agriculture, cotton production, and regional
regional trade. Growth in real output, which had output has averaged a sound 4% during
1990-95, rose to 5.5% in 1996
1990-95 and was targeted at 4.8% for 1997. 5% in 1996-98. Rapid
population growth has offset much
of this growth in output. Inflation
jumped to 55% in 1994 (compared to 3% in 1993) following the 50%
currency devaluation in January 1994, but has subsided over the past
three years, with a target of 3.5% inflation in 1997.
years. Commercial and
transport activities, which make up a large
part of GDP, are extremely
vulnerable to developments in Nigeria, particularly
fuel shortages.
Support by the Paris Club and official bilateral
creditors has eased
the external debt situation in recent years. The
government, still
burdened with money-losing state enterprises and a
bloated civil
service, has been gradually implementing a World Bank supported
supported structural adjustment program since 1991.

The economy of Benin remains underdeveloped and
dependent on subsistence agriculture, cotton production, and
regional trade. Growth in real output has averaged a sound 4% in
1990-95 and 5% in 1996-98. 1996-99. Rapid population growth has offset much
of this growth in output. Inflation has subsided over the past three
years. Commercial and transport activities, which make up a large
part of GDP, are vulnerable to developments in Nigeria, particularly
fuel shortages. Support by the The Paris Club and official bilateral
creditors has have eased the external debt situation in recent years. The
government, still burdened with money-losing state enterprises and a
bloated civil service, has been gradually implementing a World Bank
supported structural adjustment program since 1991.

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Growth in real output has averaged a sound 4% in 1990-95 and 5% in 1996-99. Rapid 1996-99, but a rapid population growth has rise offset much of this growth in output. growth. Inflation has subsided over the past three several years. Commercial and transport activities, which make up a large part of GDP, are vulnerable to developments in Nigeria, particularly fuel shortages. The Paris Club and bilateral creditors have eased the external debt situation in recent years. The government, still burdened with money-losing state enterprises and a bloated civil service, has been gradually implementing While high fuel prices constrained growth in 2000, increased cotton production - enabled by a structural adjustment major restructuring program since 1991. - and an expansion of the Cotonou port, may lead to increased growth in 2001.

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Growth in real output averaged a sound stable 5% in 1996-99, the past five years, but a rapid population rise offset much of this growth. increase. Inflation has subsided over the past several years. Commercial and transport activities, which make up a large part of GDP, are vulnerable In order to developments raise growth still further, Benin plans to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, and encourage new information and communication technology. The 2001 privatization policy should continue in Nigeria, particularly fuel shortages. telecommunications, water, electricity, and agriculture in spite of initial government reluctance. The Paris Club and bilateral creditors have eased the external debt situation in recent years. While high fuel prices constrained growth in 2000, increased cotton production - enabled by a major restructuring program - and an expansion of the Cotonou port, may lead to increased growth in 2001. situation.

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Growth in real output has averaged a stable 5% in the past five six years, but rapid population rise has offset much of this increase. Inflation has subsided over the past several years. In order to raise growth still further, Benin plans to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, and encourage new information and communication technology. The 2001 privatization policy should continue in telecommunications, water, electricity, and agriculture in spite of initial government reluctance. The Paris Club and bilateral creditors have eased the external debt situation. situation, while pressing for speeded-up structural reforms.

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Growth in real output has averaged a stable around 5% in the past six years, but rapid population rise growth has offset much of this increase. Inflation has subsided over the past several years. In order to raise growth still further, Benin plans to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, and encourage new information and communication technology. The 2001 privatization policy should continue in telecommunications, water, electricity, and agriculture in spite of initial government reluctance. The Paris Club and bilateral creditors have eased the external debt situation, while pressing for speeded-up more rapid structural reforms. Benin continues to be hurt by Nigerian trade protection that bans imports of a growing list of products from Benin and elsewhere. As a result, smuggling and criminality along the Benin-Nigeria border has been on the rise.

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Growth in real output has averaged around 5% in the past six years, but rapid population growth has offset much of this increase. Inflation has subsided over the past several years. In order to raise growth still further, Benin plans to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, and encourage new information and communication technology. Many of these proposals are included in Benin's application to receive Millennium Challenge Account funding - for which it was a finalist in 2004-05. The 2001 privatization policy should continue continues in telecommunications, water, electricity, and agriculture in spite of initial government reluctance. The Paris Club and bilateral creditors have eased the external debt situation, with Benin benefiting from a G8 debt reduction announced in July 2005, while pressing for more rapid structural reforms. Benin continues to be hurt by Nigerian trade protection that bans imports of a growing list of products from Benin and elsewhere. As a result, elsewhere, which has resulted in increased smuggling and criminality along in the Benin-Nigeria border has been on the rise. region.

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Growth in real output has averaged around 5% in the past six years, but rapid population growth has offset much of this increase. Inflation has subsided over the past several years. In order to raise growth still further, Benin plans to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, and encourage new information and communication technology. Many of these proposals are Specific projects to improve the business climate by reforms to the land tenure system, the commercial justice system, and the financial sector were included in Benin's application to receive $307 million Millennium Challenge Account funding - for which it was a finalist grant signed in 2004-05. February 2006. The 2001 privatization policy continues in telecommunications, water, electricity, and agriculture in spite of government reluctance. The Paris Club and bilateral creditors have eased the external debt situation, with Benin benefiting from a G8 debt reduction announced in July 2005, while pressing for more rapid structural reforms. Benin continues to be hurt by Nigerian trade protection that bans imports of a growing list of products from Benin and elsewhere, which has resulted in increased smuggling and criminality in the border region.

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Growth in real output has averaged around 5% in the past six seven years, but rapid population growth has offset much of this increase. Inflation has subsided over the past several years. In order to raise growth still further, Benin plans to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, and encourage new information and communication technology. Specific projects to improve the business climate by reforms to the land tenure system, the commercial justice system, and the financial sector were included in Benin's $307 million Millennium Challenge Account grant signed in February 2006. The 2001 privatization policy continues in telecommunications, water, electricity, and agriculture though the government annulled the privatization of Benin's state cotton company in spite November 2007 after the discovery of government reluctance. irregularities in the bidding process. The Paris Club and bilateral creditors have eased the external debt situation, with Benin benefiting from a G8 debt reduction announced in July 2005, while pressing for more rapid structural reforms. Benin An insufficient electrical supply continues to be hurt by Nigerian trade protection that bans imports of a growing list of products from Benin and elsewhere, which has resulted in increased smuggling and criminality in adversely affect Benin's economic growth though the border region. government recently has taken steps to increase domestic power production.

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Growth in real output has had averaged around 5% in about 4% before the past seven years, global recession, but rapid population growth has offset much of this increase. fell to 2.5% in 2009 and 3% in 2010. Inflation has subsided over the past several years. In order to raise growth still further, growth, Benin plans to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, and encourage new information and communication technology. Specific projects to improve the business climate by reforms to the land tenure system, the commercial justice system, and the financial sector were included in Benin's $307 million Millennium Challenge Account grant signed in February 2006. The 2001 privatization policy continues in telecommunications, water, electricity, and agriculture though the government annulled the privatization agriculture. As result of Benin's state cotton company in November 2007 after these reforms, Benin has become the discovery of irregularities most competitive country in the bidding process. West African Economic and Monetary Union, according to the World Economic Forum. The Paris Club and bilateral creditors have eased the external debt situation, with Benin benefiting from a G8 G-8 debt reduction announced in July 2005, while pressing for more rapid structural reforms. An insufficient electrical supply continues to adversely affect Benin's economic growth though the government recently has taken steps to increase domestic power production.

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Growth in real output had averaged about 4% before the global recession, but fell to 2.5% 2.7% in 2009 and 3% in 2010. Inflation has subsided over the past several years. In order to raise growth, Benin plans to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, and encourage new information and communication technology. Specific projects to improve the business climate by reforms to the land tenure system, the commercial justice system, and the financial sector were included in Benin's $307 million Millennium Challenge Account grant signed in February 2006. The 2001 privatization policy continues in telecommunications, water, electricity, and agriculture. As result of these reforms, Benin has become the most competitive country in the West African Economic and Monetary Union, according to the World Economic Forum. The Paris Club and bilateral creditors have eased the external debt situation, with Benin benefiting from a G-8 debt reduction announced in July 2005, while pressing for more rapid structural reforms. An insufficient electrical supply continues to adversely affect Benin's economic growth though the government recently has taken steps to increase domestic power production.

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Growth in real output had averaged about almost 4% before the global recession, but fell to 2.7% in 2009 recession and 3% it has returned to roughly that level in 2010. 2011-12. Inflation has subsided over the past several years. In order to raise growth, Benin plans to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, and encourage new information and communication technology. Specific projects to improve the business climate by reforms to the land tenure system, the commercial justice system, and the financial sector were included in Benin's $307 million Millennium Challenge Account grant signed in February 2006. The 2001 privatization policy continues in telecommunications, water, electricity, and agriculture. As result of these reforms, Benin has become the most competitive country in the West African Economic and Monetary Union, according to the World Economic Forum. The Paris Club and bilateral creditors have eased the external debt situation, situation with Benin benefiting from a G-8 debt reduction announced in July 2005, while pressing for more rapid structural reforms. An insufficient electrical supply continues to adversely affect Benin's economic growth though the government recently has taken steps to increase domestic power production. Private foreign direct investment is small, and foreign aid accounts for the majority of investment in infrastructure projects. Cotton, a key export, suffered from flooding in 2010-11, but high prices supported export earnings. The government agreed to a 25% increase in civil servant salaries in 2011, following a series of strikes, increasing pressure on the national budget. Benin has appealed for international assistance to mitigate piracy against commercial shipping in its territory.

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Growth in real output had averaged almost 4% before the global recession and it has returned to roughly exceeded that level in 2011-12. 2013-14. Inflation has subsided over the past several years. In order to raise growth, Benin plans to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, and encourage new information and communication technology. Specific projects to improve the business climate by reforms to the land tenure system, the commercial justice system, and the financial sector were included in Benin's $307 million Millennium Challenge Account grant signed in February 2006. The 2001 privatization policy continues in telecommunications, water, electricity, and agriculture. The Paris Club and bilateral creditors have eased the external debt situation with Benin benefiting from a G-8 debt reduction announced in July 2005, while pressing for more rapid structural reforms. An insufficient electrical supply continues to adversely affect hamper Benin's economic growth though the government recently has taken steps to increase domestic power production. Private foreign direct investment is small, and foreign aid accounts for the majority of investment in infrastructure projects. Cotton, a key export, suffered from flooding in 2010-11, but high prices supported export earnings. The government agreed to a 25% increase in civil servant salaries in 2011, following a series of strikes, increasing pressure on the national budget. Benin has appealed for international assistance to mitigate piracy against commercial shipping in its territory. In 2012, Benin became eligible for a second Compact under the Millennium Challenge Corporation, which is expected to be signed in 2015.

The free market economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. has grown consecutively for three years, averaging about 5% annually since 2014, but its close trade links to Nigeria expose Benin to risks from volatile commodity prices. Cotton is a key export commodity; high prices supported export earnings. Growth in real output has averaged 6.5% since 2014. earnings, but prices have fallen. Inflation has subsided and remained remains just 1% over the past several years.
An insufficient electrical supply continues to hamper Benin's economic growth though During the government recently first 6 months of President TALON’s administration, electrical supply, which has taken steps to increase domestic power production. hampered Benin’s economic growth, increased and blackouts have been reduced. Private foreign direct investment is small, and foreign aid accounts for the majority of investment in infrastructure projects.
Benin’s 2001 privatization policy continues in telecommunications, water, electricity, and agriculture. Benin has appealed for international assistance to mitigate piracy against commercial shipping in its territory. Though security remains a problem, Pilferage has significantly dropped as the Port of Cotonou has made is still making progress towards implementing the International Ship and Port Facility Security (ISPS) Code in an effort to remain competitive. Projects included in Benin's $307 million Millennium Challenge Corporation (MCC) compact (2006-2011) (2006-11) were designed to increase investment and private sector activity by improving key institutional and physical infrastructure. The four projects focused on access to land, access to financial services, access to justice, and access to markets (including modernization of the port). The Port of Cotonou is the largest component of Benin’s economy with revenues projected to account for more than 40% of Benin’s national budget.
Realizing its economic potential requires further efforts to infrastructure upgrades, stemming corruption, and expanding access to foreign markets in Nigeria and neighboring landlocked countries. In September 2015, Benin signed a MCC second Compact for $375 million that is designed to strengthen the national utility service provider, attract private sector investment, fund infrastructure investments in electricity generation and distribution, and develop off-grid electrification for poor and unserved households. In order to raise growth, Benin plans to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, encourage new information and communication technology, and establish Independent Power Producers (IPP).

The free market economy of Benin has grown consecutively for three four years, averaging about 5% annually since 2014, but though growth slowed in 2017, as its close trade links to Nigeria expose Benin to risks from volatile commodity prices. Cotton is a key export commodity; high prices supported commodity, with export earnings, but prices have fallen. Inflation has subsided and remains just 1% over earnings significantly impacted by the past several years.
price of cotton in the broader market. The economy began deflating in 2017, with the consumer price index falling 0.8%. During the first 6 months two years of President TALON’s administration, electrical supply, which began in April 2016, the government has hampered followed an ambitious action plan to kickstart development through investments in infrastructure, education, agriculture, and governance. Electricity generation, which has constrained Benin’s economic growth, has increased and blackouts have been considerably reduced. Private foreign direct investment is small, and foreign aid accounts for the majority a large proportion of investment in infrastructure projects.
Benin’s 2001 privatization policy continues in telecommunications, water, electricity, and agriculture. Benin has appealed for international assistance to mitigate piracy against commercial shipping in its territory. territory, and has used equipment from donors effectively against such piracy. Pilferage has significantly dropped as at the Port of Cotonou Cotonou, though the port is still making progress towards implementing struggling with effective implementation of the International Ship and Port Facility Security (ISPS) Code in an effort to remain competitive. Code. Projects included in Benin's $307 million Millennium Challenge Corporation (MCC) first compact (2006-11) were designed to increase investment and private sector activity by improving key institutional and physical infrastructure. The four projects focused on access to land, access to financial services, access to justice, and access to markets (including modernization of the port). The Port of Cotonou is the largest component of a major contributor to Benin’s economy economy, with revenues projected to account for more than 40% of Benin’s national budget.
Realizing its economic potential requires Benin will need further efforts to infrastructure upgrades, stemming upgrade infrastructure, stem corruption, and expanding expand access to foreign markets in Nigeria and neighboring landlocked countries. to achieve its potential. In September 2015, Benin signed a MCC second MCC Compact for $375 million that entered into force in June 2017 and is designed to strengthen the national utility service provider, attract private sector investment, fund infrastructure investments in electricity generation and distribution, and develop off-grid electrification for poor and unserved households. In order As part of the Government of Benin’s action plan to raise spur growth, Benin plans passed public private partnership legislation in 2017 to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, encourage new information and communication technology, and establish Independent Power Producers (IPP). Producers. In April 2017, the IMF approved a three year $150.4 million Extended Credit Facility agreement to maintain debt sustainability and boost donor confidence.

The free market economy of Benin has grown consecutively for four years, though growth slowed in 2017, as its close trade links to Nigeria expose Benin to risks from volatile commodity prices. Cotton is a key export commodity, with export earnings significantly impacted by the price of cotton in the broader market. The economy began deflating in 2017, with the consumer price index falling 0.8%.
During the first two years of President TALON’s administration, which began in April 2016, the government has followed an ambitious action plan to kickstart development through investments in infrastructure, education, agriculture, and governance. Electricity generation, which has constrained Benin’s economic growth, has increased and blackouts have been considerably reduced. Private foreign direct investment is small, and foreign aid accounts for a large proportion of investment in infrastructure projects.
Benin has appealed for international assistance to mitigate piracy against commercial shipping in its territory, and has used equipment from donors effectively against such piracy. Pilferage has significantly dropped at the Port of Cotonou, though the port is still struggling with effective implementation of the International Ship and Port Facility Security (ISPS) Code. Projects included in Benin's $307 million Millennium Challenge Corporation (MCC) first compact (2006-11) were designed to increase investment and private sector activity by improving key institutional and physical infrastructure. The four projects focused on access to land, access to financial services, access to justice, and access to markets (including modernization of the port). The Port of Cotonou is a major contributor to Benin’s economy, with revenues projected to account for more than 40% of Benin’s national budget.
Benin will need further efforts to upgrade infrastructure, stem corruption, and expand access to foreign markets to achieve its potential. In September 2015, Benin signed a second MCC Compact for $375 million that entered into force in June 2017 and is designed to strengthen the national utility service provider, attract private sector investment, fund infrastructure investments in electricity generation and distribution, and develop off-grid electrification for poor and unserved households. As part of the Government of Benin’s action plan to spur growth, Benin passed public private partnership legislation in 2017 to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, encourage new information and communication technology, and establish Independent Power Producers. In April 2017, the IMF approved a three year $150.4 million Extended Credit Facility agreement to maintain debt sustainability and boost donor confidence.