At the center of the Abidjan-Lagos corridor, which accounts for more than 60 percent of West Africa's wealth, Togo is the natural gateway to the dynamic West African market. Togo's natural positioning has been reinforced by a major investment policy in transport and logistics infrastructure that gives the country a unique place in West Africa.
Togo wants to consolidate its achievements by ensuring harmonious and inclusive economic development. The National Development Plan is focused on 3 mains areas: i / The establishment of a “world class” logistics hub and the development of a first-rate business center in West Africa, ii / the development of agricultural, manufacturing and extractive processing hub and iii / the consolidation of social development and the reinforcement of the mechanisms of inclusion.
In December 2022, the MCC Board of Directors selected Togo as eligible to develop a compact. The structural reforms program under the framework of the Compact With Africa aim to promote private investment in priority sectors such as Agriculture, Energy, Road and Rail Infrastructure and Extractive or Manufacturing Industry.
Togo's ruling party, the Union pour la République (UNIR), has been in power for several years and won a majority of seats in the National Assembly in the 2018 elections. In the 2020 presidential elections, Faure Gnassingbé was re-elected to a fourth term as president.
Victoire Tomégah-Dogbé was appointed Togo's first female prime minister on September 28, 2020. This came after Togo held its first municipal elections in 32 years in June 2019, in which the UNIR party won 878 of 1,490 seats. Legislative and regional elections are scheduled for the end of 2023.
Thanks in part to fiscal support, growth has been resilient to the shocks of recent years, but the cost of living has surged. After slowing to 2 percent in 2020 due the COVID-19 pandemic, growth rebounded to 5¾-6 percent in 2021 and 2022. Less favorably, consumer price inflation rose to about 7½ percent in 2022 and early 2023 (annual averages).
Large fiscal financing needs amid tightening borrowing conditions have encouraged authorities to frontload consolidation measures to bring the deficit back to 3 percent of GDP by 2025, while at the same time implementing an emergency program to address growing fragility risks in the Northern Savanes region. In particular, the supplementary budget adopted in October 2023 maintains the deficit target of 6.6 percent of GDP in 2023, down from 8.3 percent in 2022. As a result, growth is expected to fall to 5.3-5.4 percent over 2023-25 before recovering to its long-term trend projected at 5.5 percent per year as the dampening effect of fiscal consolidation measures on economic activity should be partially offset by a recovery in consumer spending supported by abating food and energy price inflation, while private investment is bolstered by improving business sentiment and ongoing infrastructure projects.
On the external side, the trade deficit has been narrowing as export revenues outpaced imports so far this year, but the current account deficit is still expected to widen somewhat to reach 4.5 percent of GDP in 2023. At the sectoral level, industrial activity has shown signs of recovery from a weak start of the year, with positive contributions from the extractive, power, and manufacturing sectors. Regarding agriculture, meteorological conditions have been conducive to a relatively favorable crop harvest for the 2023/24 season.
|Population in millions, 2022
|GDP per Capita, U.S. dollars, 2022
|GDP Growth, percent, 2022
|Inflation, CPI average, change in percent, 2022
|General Government Debt, percent of GDP, 2022
|Source: WEO, October 2023
Three projects comprising the PAL transformation:
1. Optimise port area operations
- Dry port at Cinkasse
- Truck fleet linked to the PAL
- Freeing up the inner harbour
2. Improve connections
- East-West corridor linking the Ghana and Benin borders
- North-South corridor linking Lome and Cinkasse
3. Step up management
- Strengthen the port's trade activities
- Strengthen the PAL's authority
A two-phrase development project
- Construction of an agropole (pilot programme)
- Construction of five additional agropoles
Increase generation (with balanced energy mix) and improve access to electricity
- Significantly increase energy generation from 100MW to +300MW installed power by 2020 with 50% of renewables (solar and hydro) in the energy mix (from 5% currently)
- Increase rural household access to electricity from 7% to 50% by 2022 by investing off the grid
- Guarantee access to electricity for all schools and healthcare centres in rural areas
Manufacturing focus area
Three projects for each of the two industrial parks
- Develop a park concept in line with investor expectations
- Identify sites that could serve as industrial parks
- Secure the site (acquisition, ownership and development)