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Benin: Economic Outline

Economic Indicators

The economy of Benin is strongly affected by the global economic crisis and by the political and social problems that concern its neighbor and main trade partner, Nigeria. The country experienced a slowdown of its growth during these past years, due to bad weather and floods, but also partly due to the scandals over frauds which made it lose an important purchasing power. Under those circumstances, inflation has taken control, despite an increase of price in raw materials. The year 2011 was marked by the presidential and legislative elections which paralyzed all economic evolution. Despite all, the economic perspectives announced by the ministry of economy and finance on a mid-term are relatively good. These previsions concern the development of the private sector, a recovery of the agricultural production after the floods and the follow up of the reforms established. 

The country's economic growth is drawn by trade and investments, and it is supported by the aid for the development. The essential resource of the country is its port of Cotonou which handles more than 7 million tons per year, and its strategic geographical location which allows Benin to insure the transit of merchandises from Togo and Mali. Besides the informal trade that this generates, this commercial activity allows the development of services, such as logistics, etc.

Benin is actually being the object of a three-year agreement negotiated with the IMF (2010-2013) allowing an easier access to credit. The maintenance of the viability of its debt and its public finance as well as the improvement of its external competitiveness are considered essential. The country should increase its investments in infrastructure, limiting non-priority public spending and accelerate structural reforms. The structural reform program aims to increase the mobilization of its revenues, to improve the management of public finance, to reform the civil service and the privatization of public utility companies.

Besides the country's dependence on energy resources from neighboring countries, corruption, bad management, vulnerability related to commodity prices and the rapid growth of the population are major hindrances to the country's growth. Informal trade is very important, especially with Nigeria. Benin remains one of the poorest countries in the world: more than one-third of the population lives under the poverty threshold.

 

Learn more about Market Analyses about Benin on Globaltrade.net, the Directory for International Trade Service Providers.

 

Indicator of Economic Freedom

Score:

56.0/100

Position:

Mostly unfree

World Rank:

111/179

Regional Rank:

20/45

Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation

Note: The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

 

Country Risk

See the Country Risk Analysis Provided By Ducroire.

 

Indicator of Political Freedom

Ranking:

Free

Political Freedom:

2/7

Civil Liberties:

2/7

Map of freedom 2010
Source: Freedom House

Note: The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

 

Indicator of Freedom of the Press

World Rank:

91/179

Evolution:

21 places down compared to 2010

Source: Worldwide Press Freedom Index 2011, Reporters Without Borders

Note: The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position is assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

Sources of General Economic Information

Main Online Newspapers and Portals

All Africa, Benin information
World-newspapers, Benin
Benin News
afrol News, Benin

Useful Resources

Ministry of Finance
West Africa Central Bank

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Last Updates: May 2012