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Economy of Togo

Economy of Togo
Togo phosphates mining.jpg
Phosphate mining in Togo
CurrencyWest African CFA Franc (XOF)
1 USD = Negative increase 566.06,1 XOF (2018) [1]
Trade organisations
WTO, African Union
Statistics
GDPIncrease $4.767 billion (2017) [2][3] $4.390 billion (2016)
GDP rankRank: 156th (2017)
GDP growth
5.3% (2015), 5% (2016),
4.4% (2017e), 4.8% (2018f) [4]
GDP per capita
$1,700 (2017)[5]
GDP by sector
agriculture Decrease (28.1%), industry (21.6%), services Increase(50.3%) (2017)[6]
Positive decrease -0.7% (2017)[7]
Population below poverty line
Negative increase 55.1% (2015)[8]
Labour force
2,595,000 (2007)
Labour force by occupation
agriculture 65%, industry 5%, services 30% (1998)
Unemployment6.9% (2016)
Main industries
phosphate mining, agricultural processing, cement, handicrafts, textiles, beverages
154th (2017)[9]
External
ExportsIncrease $1.002 billion (2017)
Export goods
re exports, cotton, phosphates, coffee, cocoa
Main export partners
 Benin 17.5%
 Burkina Faso 15.9%
 India 7.6%
 Mali 7.2%
 Niger 7%
 Côte d’Ivoire 6.1%
 Ghana 4.8%
 Nigeria 4.3% (2018)[10]
ImportsIncrease $2.009 billion (2017)
Import goods
machinery and equipment, foodstuffs, petroleum products
Main import partners
 China 22.9%
 Belgium 20.3%
 Netherlands 11.9%
 France 6.6%
 India 4.8%
 Singapore 4.4% (2015)[11]
FDI stock
$451 million (2017)[12]
Positive decrease $1.387 billion (2017)
Public finances
Positive decrease $391 million (2017)
RevenuesIncrease $1.469 billion (2017)
ExpensesIncrease $1.7 billion (2017)
Foreign reserves
$215.1 million (2017) [13]

All values, unless otherwise stated, are in US dollars.

The economy of Togo has struggled greatly. The International Monetary Fund (IMF) ranks it as the tenth poorest country in the world[14], with development undercut by political instability, lowered commodity prices, and external debts. While industry and services play a role, the economy is dependent on subsistence agriculture, with industrialization and regional banking suffering major setbacks.

In January 2017, the IMF signed an Extended Credit Facility arrangement consisting of a three-year $238 million loan package. Progress depends on follow through on privatization, increased transparency in government financial operations, progress toward legislative elections, and continued support from foreign donors.[15]

Agriculture

The majority of the Togolese population depends on subsistence agriculture. Its agricultural products includes coffee, cocoa, cotton, yams, cassava (tapioca), corn, beans, rice, pearl millet, sorghum and livestock such as fish. Food and cash crop production employs the majority of the labor force and contributes about 42% to the gross domestic product (GDP). Coffee and cocoa are traditionally the major cash crops for export, but cotton cultivation increased rapidly in the 1990s, with 173,000 metric tons produced in 1999.

After a disastrous harvest in 2001 (113,000 metric tons), cash crops production rebounded to 168,000 metric tons in 2002. Despite insufficient rainfall in some areas, the Togolese Government has achieved its goal of self-sufficiency in food crops — maize, cassava, yams, sorghum, pearl millet, and groundnut. Small and medium-sized farms produce most of the food crop; the average farm size is one to three hectares.

Industry

In the industrial sector, phosphates are Togo's most important commodity, and the country has an estimated 60 million metric tons of phosphate reserves. From a high point of 2.7 million tons in 1997, production dropped to approximately 1.1 million tons in 2002. The fall in production is partly the result of the depletion of easily accessible deposits and the lack of funds for new investment. The formerly state-run company appears to have benefited from private management, which took over in 2001. Togo also has substantial limestone and marble deposits.

Encouraged by the commodity boom of the mid-1970s, which resulted in a fourfold increase in phosphate prices and sharply increased government revenues, Togo embarked on an overly ambitious program of large investments in infrastructure while pursuing industrialization and development of state enterprises in manufacturing, textiles, and beverages. However, following declines in world prices for commodities, its economy became burdened with fiscal imbalances, heavy borrowing, and unprofitable state enterprises.

Togo turned to the IMF for assistance in 1979, while simultaneously implementing a stringent adjustment effort with the help of a series of IMF standby programs, World Bank loans, and Paris Club debt rescheduling. Under these programs, the Togolese Government introduced a series of austerity measures and major restructuring goals for the state enterprise and rural development sectors. These reforms were aimed at eliminating most state monopolies, simplifying taxes and customs duties, curtailing public employment, and privatizing major state enterprises. Togo made good progress under the international financial institutions' programs in the late 1980s, but movement on reforms ended with the onset of political instability in 1990. With a new, elected government in place, Togo negotiated new 3-year programs with the World Bank and IMF in 1994.

Togo returned to the Paris Club in 1995 and received Naples terms, the club's most concessionary rates. With the economic downturn associated with Togo's political problems, scheduled external debt service obligations for 1994 were greater than 100% of projected government revenues (excluding bilateral and multilateral assistance). By 2001, Togo was embarked on an IMF Staff Monitored Program designed to restore macroeconomic stability and financial discipline but without any new IMF resources pending new legislative elections. New IMF, World Bank and Africa Development Bank (ADB) lending must await the willingness of Togo's traditional donors – the European Union, principally, but the US also – to resume aid flows. So far, Togo's problematic legislative and presidential elections and the government's continued unwillingness to transition from an Eyadéma-led autocracy to democracy have deterred these donors from providing Togo with more aid. As of the fall 2002, Togo was $15 million in arrears to the World Bank and owed $3 million to the ADB.

Togo is one of 16 members of the Economic Community of West African States (ECOWAS). The ECOWAS development fund is based in Lomé. Togo also is a member of the West African Economic and Monetary Union (UEMOA), which groups seven West African countries using the CFA franc. The West African Development Bank (BOAD), which is associated with UEMOA, is based in Lomé. Togo long served as a regional banking center, but that position has been eroded by the political instability and economic downturn of the early 1990s. Historically, France has been Togo's principal trading partner, although other European Union countries are important to Togo's economy. Total United States trade with Togo amounts to about $16 million annually.

While Togo itself produces no crude oil, it is the namesake of an illegal market for stolen oil off the Niger Delta, called the Togo Triangle.[16]

Open Market

Trade is extremely important to Togo’s economy; the combined value of exports and imports equals 105 percent of GDP. The average applied tariff rate is 11.4 percent. Non-tariff barriers impede some trade. Government openness to foreign investment is above average. Capital transactions are subject to some controls or government approval. The evolving banking system continues to expand but lacks liquidity.[17]

Statistics

The following table shows the main economic indicators in 1980–2017.[18]

Year 1980 1985 1990 1995 2000 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
GDP in $
(PPP)
2.13 Bln. 2.67 Bln. 3.80 Bln. 4.71 Bln. 5.07 Bln. 6.00 Bln. 6.36 Bln. 6.44 Bln. 6.84 Bln. 7.28 Bln. 7.81 Bln. 8.49 Bln. 9.21 Bln. 9.93 Bln. 10.70 Bln. 11.44 Bln. 12.18 Bln. 12.94 Bln.
GDP per capita in $
(PPP)
897 844 1,037 1,153 1,058 1,111 1,149 1,075 1,110 1,149 1,202 1,270 1,342 1,410 1,481 1,543 1,601 1,700 [19]
GDP growth
(real)
−2.2 % 3.7 % 5.9 % 19.7 % −1.0 % −4.7 % 2.7 % −1.8 % 4.0 % 5.5 % 6.1 % 6.4 % 6.5 % 6.1 % 5.9 % 5.7 % 5.1 % 4.4 %
Inflation
(in Percent)
12.3 % −1.8 % 1.1 % 15.8 % 1.9 % 6.8 % 2.2 % 0.9 % 8.7 % 3.7 % 1.4 % 3.6 % 2.6 % 1.8 % 0.2 % 1.8 % 0.9 % −0.7 % [20]
Government debt
(Percentage of GDP)
... ... ... ... ... ... 91 % 102 % 92 % 81 % 47 % 47 % 47 % 56 % 60 % 72 % 82 % 78.6 % [21]

See also

References

  1. ^ [www.worldforexrates.com]
  2. ^ [www.cia.gov]
  3. ^ [www.cia.gov]
  4. ^ "World Bank forecasts for Togo, June 2018 (p. 154)" (PDF). World Bank. Retrieved 6 September 2018.
  5. ^ [www.cia.gov]
  6. ^ [www.cia.gov]
  7. ^ [www.cia.gov]
  8. ^ [www.cia.gov]
  9. ^ "Ease of Doing Business in Togo". Doingbusiness.org. Retrieved 2017-01-23.
  10. ^ "Export Partners of Togo". CIA World Factbook. 2015. Retrieved 26 July 2016.
  11. ^ "Import Partners of Togo". CIA World Factbook. 2015. Retrieved 26 July 2016.
  12. ^ [www.indexmundi.com]
  13. ^ "The World Fact Book: Economic Overview - Togo". Central Intelligence Agency.
  14. ^ "IMF World Economic Outlook Database List, information about Gross Domestic Product (GDP)". www.imf.org. Retrieved 2018-09-08.
  15. ^ "Togo - Economy:Togo". Central Intelligence Agency.
  16. ^ Smith, Robert; Simon, Julia (30 October 2014). "How To Steal A Million Barrels Of Oil". Planet Money. NPR. Retrieved 1 November 2014.
  17. ^ [www.heritage.org]
  18. ^ "Report for Selected Countries and Subjects". Retrieved 2018-08-28.
  19. ^ [www.cia.gov]
  20. ^ [www.cia.gov]
  21. ^ [www.cia.gov]

External links