The World Bank’s Vice President for Central and West Africa, Ousmane Diagana, will be in Lomé from October 27 to 31. The Bretton Woods institution announced the visit in a statement published on October 25. 

This is the first time that the Mauritanian executive comes to Togo. From there, Diagana, who has been overseeing 22 countries in West and Central Africa since July 2020, will go to Benin where he will be staying until November 2. The visit aligns with efforts to “strengthen the partnership between the World Bank and these two countries.” 

In Togo, the World Bank VP will meet President Faure Gnassingbé and officials. They will mainly talk about the key development goals of the country, and how the World Bank can contribute to their achievement.

Ousmane Diagana will also meet representatives of the civil society, the private sector, the youth, and conduct field visits. According to the Washington-based institution, this will be an opportunity to discuss with the press “the orientations of the Bank’s support in the coming years.” 

The World Bank is one of Togo’s main technical and financial partners when it comes to its development. To date, it has initiated 15 projects and programs in the country, for a total investment of $385.5 million. These projects are mainly in the agriculture, education, health, social protection, and telecommunication sectors.

Ayi Renaud Dossavi

Togo is the fifth-best in Africa, in terms of economic governance efficacy, despite the lingering pandemic. The country was ranked by the World Bank, in its latest Africa’s Pulse report released on Oct. 6. 

According to the report which assesses how African countries adapt to climate change and economic transformation, “in Togo, the measures deployed to tackle the pandemic represent 6.8% of the GDP.” In the World Bank’s ranking, Togo comes behind Mauritius, Guinea Bissau, Seychelles, and Rwanda, and before South Africa, Chad, Sierra Leone, and Burundi. 

Togolese authorities commented: “These results prove the pertinence of actions taken and choices made by the Togolese government to resist the heath crisis’ shock and prepare the economy’s resilience.”

They added that as soon as the pandemic broke out in the country, they took a different route, opting to invest in promising sectors. Indeed, at the beginning of the crisis, Lomé launched various projects - such as the Novissi cash transfer scheme - and introduced several incentives - such as tax reductions - to support the different social layers.

“This option has enabled the country to be far more resilient and better cushion the pandemic’s effects,” the government said.

 Esaïe Edoh

Togo will get $10 million, in the form of loans, from the OPEC Fund for International Development to finance its agricultural integration under the Regional Program for the Integration of Agricultural Markets (PRIMA).

“The Program’s objective is to strengthen the agriculture and trade sectors to sustainably increase the income and food security of rural households,” the Fund wrote in a statement. 

The loans should benefit around 45,000 households in Togo, “with a strong emphasis on creating jobs for women and youth.” The project is co-financed by the International Fund for Agricultural Development (IFAD).

Togo will receive the loan alongside its neighbor, Benin. The latter will, however, get $15 million. In both countries, more than 833,000 people are expected to benefit from the facility.

OPEC Fund Director-General Dr. Abdulhamid Alkhalifa said: “In both of our partner countries Benin and Togo, agriculture has a high development impact potential, employing a significant percentage of the working population. We are pleased to support the governments’ efforts to transform their local agriculture sectors through diversification, increased productivity, and climate change resilience.”

In detail, the monies will be used to rehabilitate nine semi-wholesale markets, 19 produce collection centers, and 500 km of rural access road sections connecting the production areas to markets. Moreover, 4,000 ha of farming lands will be developed for sustainable irrigation management, enabling family farmers to increase their production and resilience to climate change. 

The PRIMA, let’s recall, aims at improving the performance of sub-regional commercial centers and crossborder transport corridors, promoting rural entrepreneurship for youth and women, and fully integrating small farmers into local and regional markets.

Ayi Renaud Dossavi

The 13 banks active in Togo seem to be coping well against the Covid-19 pandemic which has spurred uncertainty in the country’s banking industry - an industry that was already facing many challenges.

Last year, these intermediaries lent a little over CFA615 billion to economic actors, pushing outstanding debt around CFA1,428, or somewhere above. This amount is 7% less than the amount loaned in 2019 - CFA62 billion. Also, the amount supplied in 2020 is the lowest since 2016, according to BCEAO data compiled by Togo First.

Who do banks lend to? 

In 2020, banks in Togo loaned mostly to companies in the production sector. Indeed these companies secured over 61% of bank loans disbursed that year; up about 3% compared to 2019 where they grabbed 55% of all loans the lenders gave out.

After private companies, individuals were the ones most backed by banks that operate in the country. They received CFA125 billion - 20% of the total portfolio - from the lenders in 2020. The sum is 6% down compared to 2019.

Meanwhile, banks were more reluctant than usual to lend to individual entrepreneurs. Last year, bank loans to these actors plummeted by 30% compared to the year before. Regardless, this segment remains in a tie with the State and its arms (public companies included).

However, the data available reflects an increase of loans to the government in 2020, even though banks tightened their lending terms.

An in-depth analysis

46% of the new loans provided by banks in 2020 - CFA285 billion - served to support the cash flow of businesses as they were struggling amidst the pandemic.

Regarding lending to back exports, while still very low, they bounced from CFA1.3 billion in 2019 to CFA1.6 billion in 2020; though borders were closed. The increase contrasts with 2018’s dip (CFA100 million). As for consumer loans, in 2020 they stood at CFA114 billion which is more than 18% of the total sum loaned by banks over the period.

Fiacre E. Kakpo