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: the presidential party, Union for the Republic (UNIR) has 62 seats; the National Alliance for Change (ANC) has 19 seats; the Action Committee for Renewal (CAR) has six seats; the Union of Forces for Change (UFC) has three seats; and Sursaut National has one seat.
On April 25, 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 votes. The new government formed in June 2015 counts 24 ministers and is led by a new Prime Minister, Komi Selom Klassou.
Togo’s economy has been growing at an average rate of about 5% over the past five years. Growth in 2015 is estimated to have reached 5.5% and is projected at 5.4% in 2016. The major growth contributor in 2015 was the secondary sector (2%) due to the performance of extractives and manufacturing industries, followed by the service sector (2%) resulting from increased trading volumes at the Lomé sea port and the Lomé International Airport. Growth has also been significant but volatile in agriculture, ranging between 0% in 2013, to 14% in 2014, and 2% in 2015 year on year. The building and public works sector comprises only 7% of the GDP, but the rate of growth has been highest in this sector attaining 15.5% in 2015. Growth is projected to be sustained at a moderate rate over the next three years due to continuous government investment in infrastructure. Inflation remained under control at 1.8% in 2015 and will certainly remain below the 3% West African Economic and Monetary Union (WAEMU) threshold in 2016. On the external front, a more than proportionate increase in exports compared to imports is expected to reduce the current account deficit from -10.1% in 2015 to -9.8% in 2016.
Togo’s business regulatory environment recorded improvements in the Doing Business (DB) 2016 (ranked 150th) compared to prior years’ rankings. The country has made starting a business easier by enabling the one-stop shop to publish notices of incorporation and eliminating the requirement to obtain an economic operator card. The government has initiated important reforms, including the preparation of a Doing Business roadmap, identifying key short term measures to improve Togo’s performance, the revision and adoption of the new investment code to better align it with international best practices, and the new Free Zone law to strategically reposition the Free Zone. Togo has also made progress in privatizing state activities including an insurance company, two banks, hotels, power distribution, and port container-handling activities.
Poverty remains widespread in Togo although national poverty rates declined from 59% in 2011 to 55% in 2015. Despite this declining trend, poverty is mostly a rural phenomenon with 69% of rural households living below the poverty line in 2015. Moreover, female-headed households experience higher poverty rates than male headed households (57.5% against 55% in 2015). Also, vulnerability is higher amongst women and they suffer from lack of economic opportunities and are equally underrepresented in high-level decision making positions. The education and health sectors represent a significant share of annual public spending (an average of 14% and 7% were allocated to the education and health sectors respectively from 2009 to 2014). However, more needs to be done to make sure that high level regional disparities in resource allocation are narrowed and the resources allocated to these two sectors are increased and used in the most efficient and effective manner.
Togo needs to increase efforts in terms of achieving the seventeen Sustainable Development Goals (SDGs) given that the country was not able to achieve six of the eight Millennium Development Goals (MDGs). At the end of 2015, Togo had registered progress only in universal primary education and the control of HIV/AIDS. Also, despite the important progress noted in the 2015 and 2016 Doing Business reports, the business climate remains challenging and efforts need to be done to scale up all 10 Doing Business indicators, namely: starting a business, dealing with construction permits, access to electricity, registering property, access to credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Overall, the key development challenges for Togo as stated in the country’s poverty reduction strategy include: (i) developing sectors with strong growth potential; (ii) strengthening economic infrastructure; (iii) developing human capital, social safety nets, and employment; (iv) strengthening governance; and (v) promoting a more balanced, participatory, and sustainable development.
Last Updated: Oct 11, 2016