Burkina Faso is a low-income, landlocked Sub-Saharan country with limited natural resources. Its population, which is growing at an average annual rate of 3.1%, was estimated at almost 18.6 million inhabitants in 2016. The economy is heavily reliant on agriculture, with close to 80% of the active population employed in the sector. Cotton is the country’s most important cash crop, while gold exports have gained importance in recent years.
Political context
The capital, Ouagadougou, was hit by a third terrorist attack on March 2, 2018, which claimed the lives of eight Burkinabè soldiers. These attacks are occurring in an increasingly difficult security context for the entire subregion in general, and Burkina Faso in particular. The extremist group Nusrat al-Islam wal-Muslimin led by Iyad Ag Ghaly claimed responsibility for the attacks. Two previous attacks had plunged the capital city into mourning in January 2016 and August 2017.
Economic overview
Growth picked up and is expected to reach 6.4% of GDP in 2017, owing to the expansion of the gold mining sector and increased investments in infrastructure.
However, public finances have deteriorated significantly.
Higher tax revenues have not been sufficient to offset increases in the wage bill, current transfers, and public investments. The fiscal deficit, which stood at 3.4% in 2016, widened considerably in 2017 to an estimated 8.2% of GDP, the highest rate recorded in Burkina Faso over the past decade. To offset this increase in budgetary expenditure, the Government combined concessional aid and borrowing on the regional market.
The Government should continue its efforts to boost revenues, which continue to lag behind those of the top performers in the region. The Government should also enhance the effectiveness of its investment program by selecting and executing the most important programs, while controlling the fiscal risks associated with public-private partnerships.
The economic outlook remains favorable in the short and medium term, with GDP growth projected to stabilize around 6% over the period 2018-2020. This growth would be supported by the agricultural, services, and mining sectors and ongoing public investment (all against the backdrop of a stable political environment).
The external current account deficit is projected to hold steady at 8% of GDP in 2018 and narrow to 7% of GDP over the next two to three years. The fiscal deficit (including subsidies) is forecast to narrow to 5% of GDP in 2018 and converge in 2019 to the 3% target of the West African Economic and Monetary Union (WAEMU).
Medium-term outlook
Burkina Faso is vulnerable to major internal and external risks. On the external front, risks pertain to the volatility of oil import prices and gold and cotton prices. Domestically, the threat of terrorism and civil unrest could have an impact on the mining sector, tourism, and government revenue.
Human development
Despite a noticeable improvement in recent years, maternal and child health indicators have not yet attained the targets set in the sustainable development goals (SDGs) of the United Nations and the National Economic and Social Development Plan (PNDES). The maternal mortality rate fell from 484 per 100,000 live births in 1998 to 330 per 100,000 live births in 2016, while use of contraceptive methods declined from 34.3% in 2014 to 31.1% in 2015, with a fertility rate of 5.4 children per woman. The percentage of assisted childbirths increased from 76% to 81.9% in 2016.
The under-five mortality rate also dropped from 129 deaths per 1,000 live births to 81.6 deaths per 1,000 live births, while neonatal mortality rate dropped from 31 deaths per 1,000 live births in 2003 to 23.2 deaths per 1,000 live births in 2015. Infant mortality also decreased substantially, falling to 43 deaths per 1,000 live births in 2015 from 90 deaths per 1,000 live births in 1998 (EMD 2015). Life expectancy at birth was 58.6 years (2014).
Despite a downward trend, malnutrition remains endemic, with a prevalence of acute malnutrition of 7.6% in 2016 compared to 15.5% in 1998 and an incidence of stunted growth of 27.3%, compared to 34.6% in 1998 (SMART 2016).
Between 2005 and 2016, the gross preschool enrollment rate increased from 2% to 3.5%, while the primary enrollment rate rose from 57% to 88.5%. Access to secondary education also improved, increasing from 20% in 2005 to 49% in lower secondary schools in 2016-2017 and from 5.6% to 16.2% in upper secondary schools in the same period. However, the youth literacy rate, which stood at 28.7% in 2010, remains lower than the average rate of 71% for Sub-Saharan Africa.
Only 35.4% of pupils complete primary school with the required level of competence in mathematics and reading, compared to 16.2% for lower secondary schools and 11.2% for upper secondary schools.
The poverty rate fell slightly between 2009 and 2014, from 46% to 40.1%.
Development challenges
Burkina Faso remains vulnerable to shocks related to changes in rainfall patterns and to fluctuations in the prices of its export commodities on world markets. Its economic and social development will, to some extent, be contingent on political stability in the country and the sub-region, its openness to international trade, and export diversification.
Last Updated: May 17, 2018
