Togo Records Sharpest Drop in Regional Market Debt in H1 2025

Finance

Tuesday, 08 July 2025 05:36

Togo Records Sharpest Drop in Regional Market Debt in H1 2025

(Togo First) - Togo recorded the sharpest decline in public debt among West African Economic and Monetary Union (WAEMU) member states during the first half of 2025. Data from UMOA-Titres, the regional agency in charge of facilitating the issuance of public securities in the WAEMU region, showed Togo's outstanding debt stood at 1,959.50 billion CFA francs by the end of June, a 2.90 percent decrease from December 2024.

This trend stands in contrast to the broader regional dynamic. Over the same period, countries like Senegal saw their debt stock increase by 5.71 percent, while Benin's rose by 2.28 percent and Côte d'Ivoire's by 1.46 percent. Niger was the only other country to report a decline, at 0.93 percent, though to a lesser extent than Togo.

The drop is primarily due to fewer new debt issuances combined with accelerated repayments. Between January and June, Togo raised 318.76 billion CFA francs, a 32 percent drop from 468.75 billion CFA francs during the same period last year. Concurrently, repayments increased by 39 percent, from 322.55 billion to 448.30 billion CFA francs.

This net debt reduction of over 129 billion CFA francs aligns with the national debt management strategy, which aims to rebalance the portfolio structure. Currently, domestic debt makes up 57.67 percent of the total stock, representing 39.89 percent of GDP. By the end of 2025, authorities aim for a more balanced split, targeting 55 percent external debt and 45 percent domestic debt. This shift would allow for longer repayment maturities and access to more favorable financial terms through concessional or semi-concessional loans from partners such as the World Bank, BOAD, or AfDB.

One persistent challenge, however, is the dominance of short-term securities in the domestic debt portfolio. As of late June, 89 percent of Togo's debt on the regional market consisted of Treasury Bills, or BAT, with maturities under one year. Only 11 percent were Treasury Bonds, or OAT, which have longer durations. This profile creates significant refinancing pressure in a regional environment characterized by rising interest rates.

This vulnerability is evident in Togo's yield curve. Returns climb as high as 8.04 percent on one-year securities before falling on longer maturities, settling around 6 percent for five to ten-year bonds. This unusual configuration indicates both investor nervousness in the short term and a more moderate, or confident, appetite for long-term investments.

While the decrease in outstanding debt is seen as positive from a budget management perspective, it remains uncertain whether the government can sustain this trajectory through the second half of the year.

Fiacre E. Kakpo

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.