Economic Analysis


Population 12.5 million
GDP per capita 1,417 US$
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major macro economic indicators

  2020 2021 2022 2023 (f) 2024 (f)
GDP growth (%) 3.8 7.2 6.3 6.1 6.3
Inflation (yearly average, %) 3.0 1.7 1.4 2.8 3.0
Budget balance (% GDP) -4.7 -5.7 -5.6 -4.5 -4.0
Current account balance (% GDP) -1.7 -4.2 -6.0 -5.5 -5.0
Public debt (% GDP) 46.1 50.3 54.2 54.2 54.0

(e): Estimate (f): Forecast


  • High growth potential, based in particular on tourism, transit trade and improved agricultural yields
  • Strategic position (access to the sea for hinterland countries: 2000 km pipeline from Niger to Benin completed)
  • Effective structural reforms: investment and fiscal consolidation
  • Support from multinational organisations and bilateral partners


  • Poorly diversified economy (exports based on cotton and re-exports, and imports of energy and food)
  • Governance shortcomings: corruption, bureaucracy, political and judicial arbitrariness
  • High poverty rate (47%), high level of underemployment (70%), massive informal sector (90% of jobs), linked to subsistence agriculture
  • Insecurity in the north due to Islamist incursions
  • Tensions with neighbouring Niger

Risk assessment

Promising economic prospects, supported by diversification projects

In 2023, economic growth proved resilient despite headwinds thanks to public and private investment. The slight downturn was due to weaker agricultural production (30% of GDP), affected by unfavourable weather conditions, lower household consumption due to the sharp rise in inflation caused by higher oil prices from Nigeria (Benin's main supplier of petrol), and the closure of the border with Niger. In 2024, growth should increase slightly, driven mainly by investment, notably in the construction sector with phase II of the expansion of the Glo-Djigbé industrial zone (GDIZ). This public-private partnership between the Beninese government and the ARISE Integrated Industrial Platforms group (ARISE IIP) involves the construction of a 1,640-hectare industrial zone (currently 400 hectares already occupied by 36 investors and 12 factories), mainly dedicated to the processing of local agricultural products, notably cotton into textiles, but also to the production of building materials, wood processing, packaging and the production of generic medicines. The GDIZ is expected to boost manufacturing output and exports, supporting economic growth. The export of raw cashew nuts has been banned since the beginning of 2024 to encourage local processing. The GDIZ is part of the National Development Plan (PAG II, 2021-2026), which aims to strengthen the competitiveness of the Beninese economy, diversify its sources of growth, create jobs and reduce poverty. Public spending will remain high under this plan, which notably calls for improving the competitiveness of the Port of Cotonou, with a project to extend the port basin (costing 107.7 billion FCFA, or around 164 million euros) and build a new terminal (costing 98.3 billion FCFA, or around 125 million euros) to increase shipping capacity. Agricultural production (cotton, maize) is set to increase in 2024, aided by government subsidies on fertilizers in particular, thus bolstering exports. On the other hand, a sustained recovery in oil exports from Niger, transported via the cross-border pipeline, remains highly uncertain due to heightened tensions between the two countries. Private consumption is expected to make only a small contribution to economic growth due to persistent inflation, although this remains within the WAEMU range (1%-3%) as bottlenecks in the supply chain will persist due to heightened tensions in the north of the country and the likely continued closure of the border on the Niger side.

Consolidating public accounts and reducing the current account deficit

In 2023, the public deficit was reduced thanks to increased mobilisation of tax revenues, up 0.7 percentage points (15% of GDP), and rationalisation of expenditure, up 0.6 percentage points (19.2% of GDP). Fiscal consolidation planned under the 42-month IMF programme financed by the Extended Credit Facility (ECF) and the Extended Fund Facility (EFF) (approved in 2022 with a total amount of USD 638 million) is set to continue in 2024. The 2024 Finance Bill forecasts a 12.8% increase in budgetary resources compared with 2023, in application of a medium-term revenue mobilisation strategy (MTRS). The MTRS aims to generate 0.5% of GDP in additional revenue each year by broadening the tax base, improving tax compliance and strengthening oversight via the digitisation of tax systems. However, the large size of the informal economy (around 60% of GDP) will act as a brake. Public spending is set to increase by 8.7% in 2024, according to the government budget due to military expansion in view of the heightened security threat in northern Benin. In addition, public spending planned under PAG II and for the expansion of the port of Cotonou will continue to weigh on the deficit. The public deficit will be mainly financed by external debt, representing 37% of GDP (18% of GDP for domestic public debt), with the issuance of Eurobonds in February 2024 (USD 750 million with a 14-year maturity and a 7.96%-dollar coupon). The funds will be used in part to finance development projects under PAG II. The public debt ratio is expected to remain stable, still below the WAEMU threshold of 70% of GDP thanks to continued fiscal consolidation and robust growth.
The current account deficit is set to narrow in 2024, thanks to a rise in exports supported by the expansion of the Glo-Djigbé industrial zone and the port of Cotonou. Nevertheless, the balance of trade will remain in deficit due to the high demand for capital goods associated with various construction projects, thus sustaining imports. The services deficit is set to persist, while revenues from oil transshipment activities remain highly uncertain. The surplus on the secondary income account will increase slightly, supported by expatriate remittances and project aid, while the deficit on the primary income account will persist due to profit repatriation by foreign companies and interest paid on debt securities. The current account balance will be financed by FDI flows attracted by industrial and port expansions, by IMF disbursements, and by the recently-issued Eurobond.


Border tensions between Niger and Benin

Re-elected in 2021 for a 5-year term, President Patrice Talon aimed to marginalise the political opposition through electoral impediments (targeted arrests) and the instrumentalisation of the judiciary (appointment of magistrates). In the legislative elections of January 2023, two political parties associated with Patrice Talon won 81 of the 109 seats in the National Assembly, further strengthening the President's position despite his assertion in February 2024 that he would not seek a third term in 2026 (requiring a constitutional amendment to the two-term limit).
Since 2019, Benin has faced attacks from jihadist groups in the north of its territory, mainly from Burkina Faso. In response, the Beninese authorities are creating new operational bases and actively recruiting personnel, with a target of 5,000 military personnel announced in April 2023. Cotonou is seeking international support, notably from France, but also from the European Union, which has announced the release of EUR 47 million in support of its fight against attacks (earmarked for the acquisition of materials and equipment). The Beninese authorities have also found additional partners in China (dispatch of reconnaissance and combat drones) and the Gulf States, potential investment providers, as well as Rwanda, through the conclusion of a security agreement covering police and anti-terrorist training in September 2022. The border with Niger has also become a source of concern since the overthrow of Niger’s President Mohamed Bazoum by the military in July 2023. Despite the lifting of ECOWAS economic sanctions and the reopening of the border on the Benin side at the end of February 2024, Niamey kept the border closed, justifying its action by the existence of French military bases in Benin, although the Beninese government and the French general staff refute this. In response, Porto Novo banned the shipment and export of Nigerian crude oil, transported via the new pipeline inaugurated in November 2023, from the port of Sèmè, thus blocking one million barrels of crude extracted by the China National Petroleum Corporation. Despite mediation by the Chinese authorities, tensions are expected to remain high, especially following the arrest and conviction for fraud of five Niger nationals at the port of Sèmè. In response, Niger closed the pipeline at the beginning of June, although a temporary authorisation had been granted by Benin in mid-May, allowing the loading of a first vessel. China, which granted Niger a USD 400 million advance in May 2024, repayable from revenues generated by the sale of Nigerien crude oil (expected over 12 months), is expected to continue mediating between the two countries with the aim of easing tensions.


Last updated: July 2024

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