Togo is a Sub-Saharan West African country that shares borders with Ghana to the west, Burkina Faso to the north, and Benin to the east. It has an estimated population of 7.3 million inhabitants, with a demographic growth rate of about 3%.
Togo’s political landscape is dominated by the five following main parties, all of which have seats in the parliament: in early 2017, the presidential party, Union for the Republic (UNIR), had 62 seats; the National Alliance for Change (ANC) 19 seats; the Action Committee for Renewal (CAR) six seats; the Union of Forces for Change (UFC) three seats; and Sursaut National one seat.
On 25 April 2015, President Faure Gnassingbe was re-elected for a third five-year term. Jean-Pierre Fabre, the leading candidate of the opposition, obtained 35% of the vote. The new government, formed in June 2015, comprised 24 ministers and was led by a new Prime Minister, Komi
Togo’s recent economic performance has been relatively robust: over the past three years, GDP growth has averaged approximately 5%, higher than most Sub-Saharan economies. While Togo has been subject to negative shocks, including the impact of the economic slowdown in Nigeria and lower commodity prices for its main exports, such as phosphates and clinker, at the same time the government has pursued an ambitious public investment program that—in 2015/16—helped sustain aggregate demand.
The main drivers of economic growth have been agricultural production and the extractive industries, as well as trading activities. Agricultural production, which accounts for approximately half of the country’s GDP and over 60% of its employment, benefitted from good climatic conditions. Inflation has remained under control, averaging 2.1% in 2016 thanks to a prudent monetary policy followed by the BCEAO and low food prices.
Togo’s external current account deficit remains substantial, however, as exports have declined as the result of lower demand by the country’s main trading partners, and income and service balances have improved over the past 12 months. The current account deficit was financed by a combination of aid, non-concessional borrowing, and Foreign Direct Investment (FDI) inflows.
The fiscal situation deteriorated sharply during 2015 and 2016, with the fiscal deficit growing from 5.8% of GDP in 2013 to over 9% during this period, while the central administration reported the accumulation of about FCFA 60 billion in arrears at the end of 2016, representing 2.5% of GDP. Concurrently, the public debt to GDP ratio grew rapidly to an estimated 77.4% of GDP, which is the highest in West Africa and greater than the threshold of 70% of GDP agreed to within WAEMU.
In early 2017, the government launched a new economic program anchored in a three-year agreement with the International Monetary Fund (to be approved in April 2017). The program is based on a severe cut to fiscal spending and increased efforts to mobilize public revenue in order to restore the fiscal space and reduce the country’s debt burden.
Last Updated: Apr 01, 2017