Togo: Public debt to GDP ratio grows for a third consecutive year

Economic governance

Tuesday, 11 April 2023 16:32

Togo: Public debt to GDP ratio grows for a third consecutive year

(Togo First) - Togo's public debt stood at CFA3,337 billion in 2022. That is 65.84% of its GDP, according to a report recently released by the Ministry of Economy and Finance.

This is the third consecutive year that the debt ratio rises. It stood at 51.95% and 62.43% in 2020 and 2021, respectively. Back in Q3 2022, the Ministry of Finance said the country’s debt was “under control”. Indeed, despite the increase in the past three years, the public debt-to-GDP ratio is still under the 70% standard set by the West African Economic and Monetary Union (WAEMU).

According to the Ministry of Finance’s report, Togo’s total debt soared from CFA2,191.04 billion in 2018 to CFA3,337.36 billion (+52%). In detail, the external debt jumped from CFA600 billion (2018) to CFA1,296 billion (2022). Meanwhile, domestic debt rose from CFA1,590 billion to CFA2,041 billion, over the same period. The surge is imputable to the government’s efforts to curb the Covid-19 crisis and its economic impacts.

Last year, Togo cleared CFA504 billion out of its total debt. Around 21% of this amount–CFA107 billion–was dedicated to clearing part of the country’s external debt, and the remaining CFA396 billion was for domestic debt.

Ayi Renaud Dossavi

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REFORMS OVERVIEW

STARTING A BUSINESS (more info)

At the fifteenth position, worldwide, and first in Africa, under the Starting a Business index of the 2020 Doing Business ranking, Togo sustains its reformative dynamics with more reforms….

ENFORCING CONTRACTS (more info)

Compared to some years ago when it was one of the lowest rankers under the Doing Business’ Enforcing Contracts indicator, Togo, leveraging many efforts to improve its business climate, was able to jump significantly on the index in the recent years... .

CONTRACT EXECUTION (more info)

Creation of special chambers of commerce for small debts • Creation of chambers of commerce at the Court of Appeal • Civil and commercial cases now handled by distinct clerks • Establishment of commercial courts in Lomé and Kara • Lawyers and bailiffs now have access to the FORSETI COMMERCIAL platform • A maximum period of 100 days was fixed to settle a commercial dispute .

TRADING ACROSS BORDERS (more info)

In comparison to previous years,Togo has significantly improved its ranking under the“Trading across borders” indicator by adopting multiple reforms that focus mainly on the digitization and reduction in delays, for import and export procedures related to import and export.

In comparison to previous years, Togo has significantly improved its ranking on the “Trading across borders” index by adopting multiple reforms that focus mainly on the digitalization and reduction in delays, for import and export procedures related to import and export.

CONSTRUCTION PERMIT (more info)

After moving from the 133rd to 127th place under the 2020 Doing Business’ construction permit index, Togo intends to reiterate this feat in the coming edition of the global ranking. To this end, it has introduced this year multiple reforms.

GETTING ELECTRICITY (more info)

Over the past two years, Togo’s ranking under the Doing Business’ Getting electricity and water indicator has increased consistently. Owing this performance to multiple reforms aimed at making it easier for businesses to access power and water, Lomé plans to introduce even more reforms this year to keep up its improvements.

REGISTERING A PROPERTY (more info)

Out of all the 'Doing Business’ indicators, Property Registration is where Togo has improved the most since 2018. Indeed, after spending years in the lowest part of this ranking, the country now seeks to beat Rwanda which is the best performer on this index in Africa. To do so, Lomé has been introducing many reforms, with the latest batch implemented this year.

PUBLIC PROCUREMENT (more info)

From professionalization to digitization, through legislative regulations, Togo’s public procurement framework is constantly being modernized. Several reforms have been implemented to improve the sector much to the benefit of the private sector, which is the focus of the National Development Plan.

PAYING TAXES AND DUTIES (more info)

To improve its business environment, Togo introduced some important reforms related to the payment of tax and duties. From the replacement of some taxes to the cancellation of others through exemptions, the country has only one objective: offer the most attractive tax framework to investors and economic operators. To achieve this, the authorities relied on digitization.