Economic Outline

Economic Indicators

Despite a challenging regional context and international circumstances, Togo demonstrates robust growth, propelled by strong domestic demand and sustained public and private investments. In 2023, growth reached an estimated 5.4%. However, this marked a moderation from the 5.8% recorded in 2022, reflecting a government transition from an expansionary fiscal policy stance to a more restrained approach. Economic growth is expected to stabilize at 5.3% this year and in 2025, as further fiscal consolidation measures are offset by increased consumer spending and private investment.

Concerning public finances, a sluggish implementation of scheduled public investment and proposed additional spending cuts outlined in the revised 2023 budget led to a reduction in the fiscal deficit to 5.8% of GDP, compared to 8.3% in 2022 (World Bank). In December 2023, the IMF staff and Togolese authorities reached a staff-level agreement on economic policies and reforms. This agreement will be supported by a new 42-month arrangement under the Extended Credit Facility (ECF), amounting to approximately USD 390 million. The aim is to address urgent spending needs, particularly arising from escalating security concerns, and to uphold stability and social inclusion. The primary reforms aim to achieve a reduction in the budget deficit to 3% of GDP by 2025 while safeguarding spending that can foster growth and improve economic inclusion. The fiscal strategy partly depends on implementing measures to boost domestic resource mobilization by 0.5% of GDP annually. Additionally, the authorities will streamline public expenditure. Public debt increased to 67.2% of GDP in 2023 and is expected to follow a downward trend over the forecast horizon, landing at 66% in 2025 (IMF). Meanwhile, inflation is projected to fall from 5% in 2023 to 2.8% in 2024 thanks to purchasing power support from the government.

In 2022, the unemployment rate in the country was at 3.8% (World Bank, ILO estimate). The poverty rate is anticipated to decrease to 24.8% in 2025, marking a significant decline from the estimated 28.4% in 2022 (World Bank). Poverty rates are higher in female-headed households (45.7%) compared to male-headed households (45.2%). Women continue to face greater vulnerability due to limited access to economic opportunities, education, healthcare, and other essential socioeconomic resources. The country’s GDP per capita (PPP) was estimated at USD 2,601 in 2022 by the World Bank.

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