Togo First
The safety level at Lomé’s airport is better than the global average
Two weeks into the audit launched by Lomé’s international airport (AIGE) to get its aerodrome certified, experts from the International Civil Aviation Organization (ICAO) said the platform meets 80% of security standards imposed by the organization. This is 20% more than the global average, commented Edem Semenya, aerodrome inspector and chief of the auditing team. According to him, the AIGE is on the right track to get the certification needed to keep running its aerodrome.
While lauding the airport’s security standards, ICAO experts recommended an update of the aerodrome manual, the SGS manual, and the lighting of some obstacles at the aerodrome.
Before the certificate is effectively issued, noted Col. Gnama Latta, an audit report will be produced and submitted to the national agency for civil aviation (ANAC). The latter will then forward the report to Société Aéroportuaire de Lomé-Tokoin, alongside a corrective action plan. It is only when this plan is validated that the ANAC will provide the AIGE the certificate without which it cannot operate its aerodrome.
In parallel, let’s recall, the AIGE recently obtained its health certificate for efficiently handling the Covid-19 pandemic.
Séna Akoda
Less than a year after GDP rebasing, Togo’s debt rose 8%
At the end of Q4 2020, Togo’s debt to GDP ratio was 59%, according to its minister of economy and finance, Sani Yaya.
This is 8% more than the figure recorded at the end of Q3 2020. This was subsequent to the GDP rebasing after which the national GDP was re-evaluated at CFA4,230.6 billion in 2019, from CFA3,216.8 billion (before the rebasing). In debt-to-GDP ratio terms, before the rebasing, the figure in 2019 was 68.3% but it decreased to 51.9% subsequently.
In effect, GDP rebasing involved a change of calculation systems and better coverage of the informal sector. It also forecasted national GDP in 2020 at nearly CFA4,400 billion.
Debt
Over the period reviewed (2020), the debt contracted by Lomé from its external lenders increased, mainly due to the pandemic which called for substantial spending. Regardless, the country’s debt level is still far from the 70% standard imposed in the region.
In detail, Togo raised great amounts on the WAMU market, issuing for example the BCEAO recovery bonds.
Regarding budget deficit, it widened, reaching 6.12% in 2020, as expenditures grew by 31% - from about CFA856 billion in 2019 to CFA1,132 billion last year.
No surprise
The situation is not surprising given the impact of the Covid-19 pandemic on economies.
Last year, sometime after the rebasing, various international experts and multilateral institutions expected the country’s debt to increase, because of the health crisis and the government’s response. The World Bank, for example, had said that overall public debt would reach 71% of the GDP in 2020 (Surely the projection did not take into account the GDP rebasing).
A much-awaited recovery
This year, while optimistic, Togolese authorities remain prudent about the economic outlook. According to them, the economy should grow by 4.8%, as a result of efforts made last year and measures that were introduced more recently to mitigate the pandemic’s effects and restart the economy. Already, available data shows that economic activity and growth are more resilient in 2021 than they were in 2020.
It should be noted that at the end of the first half of 2020, Togo had a public debt of about CFA2,407 billion (a little over $4.2 billion) - a debt labeled in CFA Francs mostly.
Ayi Renaud Dossavi
Banks postponed loan repayment deadline for nearly 438 businesses and about 1,500 individuals
In Togo, banks have deferred the loan repayment of at least 438 businesses and 1,454 people, in line with the BCEAO’s relief incentive. This was revealed last Thursday by the minister of economy and finance, Sani Yaya. In all, the repayment of CFA28 billion was pushed back to provide more room for businesses and individuals hit by the ongoing health crisis to breathe.
The incentive was introduced on March 21, 2020, as the pandemic was breaking out in the subregion. In its framework, banks were allowed to push back the deadline for loan repayment, for businesses, affected by the health crisis and related counter-measures, that would request an extension. Lenders could give these actors 3 months, renewable once, to pay what they owe. During this period, no interest, fee, or penalty for delayed payment was to be charged.
In exchange, banks could categorize the deferred debts as good debts, without impairing their results, portfolio quality, cost of risk, profitability, and equity.
“The classification of deferred maturities in a specific account in the category of sound loans will also alleviate the fear of banks regarding a potential spread in case of default on the original loans, due to exposures worsening as a result of granting additional facilities to allow debtors to resume activities so they can honor their commitments,” said Kossi Djokoto, a financial analyst at Attijariwafa bank in Togo (BIA).
Regarding new loans granted, banks provided CFA590 billion in 2020, thus making a total of CFA1,306 billion of bank loans poured into the economy. This total amount represents 30% of the rebased GDP - a performance, in absolute terms, that is lauded by minister Yaya.
Fiacre E. Kakpo
UMOA-securities: Togo secures CFA82.5 billion in last bond issue
Last Friday, Togo raised CFA82.5 billion on the regional market. This is 41.6% of the overall subscription (valued at CFA198 billion) the country recorded for the operation.
Togo, which was seeking CFA75 billion, proceeded to three simultaneous issues of fungible treasury bonds. The respective maturity periods of these issues were five (5), seven (7), and 10 years.
In detail, the five-year bonds raised CFA8.25 billion, while the other two (7 and 10 years) garnered respectively CFA15.5 billion and CFA58.7 billion.
This quarter, Togo wants to raise a total of CFA165 billion on the regional market. The funds will support its post-Covid economic recovery strategy and meet its budgetary needs.
Séna Akoda
The Davié Iron-recycling plant cost $25 million to develop
A total of $25 million was spent to build Manumetal, the iron-recycling plant based in Davié (30 km from Lomé). The plant was visited last week, April 15, by the minister of trade, Kodjo Adedze.
According to the ministry of trade, the plant, which started production in January 2020, employs more than 200 people, including 150 Togolese. It makes concrete iron, metal pipes, and welding electrodes, using scrap metal and aluminum ingots.
Wu Defa, CEO of Manumetal, declared that the company is progressively penetrating the market. Regarding the plant’s commercial goals, 70%-80% of the finished product should be sold in the local market while annual output should increase by 5% over the next five years.
While visiting Manumetal’s plant, Kodjo Adedze pointed out that the use of “irregular-sized concrete iron” is prohibited by Togolese regulations.
Séna Akoda
Less than two billion CFA left to secure for the Fifth General Housing and Population Census
Togo only needs about CFA2 billion more to close the budget mobilization for its Fifth General Housing and Population Census (5ème Recensement Général de la Population et de l’Habitat, RGPH-5).
So far, the country has collected CFA7 billion out of the 8.6 billion it needs in this framework. The available funds will be used to finance primary activities scheduled as part of the program.
Out of the sum secured at the moment, CFA3 billion was mobilized last Thursday, at a virtual roundtable presided by Sandra Ablamba-Johnson, minister and secretary-general of the Togolese presidency. On the occasion, financial and technical partners of Togo, with the United Nations Population Fund (UNFPA) as lead partner, committed to providing the missing funds.
According to current estimates, the Togolese population is about eight (8) million people. The RGPH-5 will help get an exact estimate.The last major census carried out in the country dates from 2010. It estimated that a little more than six (6) million people were living in Togo at the time.
Séna Akoda
Togo: Budget deficit widens amid Covid-19 pandemic
Togo’s budget deficit reached 6.12% in 2020, due to greater spending in response to the Covid-19 health crisis. From CFA856 billion in 2019, this deficit soared to CFA1,132 billion in 2020, thus nearly 31% more.
Meanwhile, budget income grew only by 5.72%, from CFA822 billion to CFA869 billion, including CF652 billion in tax revenues.
“The Covid-19 pandemic put the country in such a situation that it had to rapidly proceed to huge expenditures, especially in the social sector; this, in a context where economic activities and consequently tax revenues everywhere in the world were regressing, especially in the second and third quarters of 2020. In such circumstances, it isn’t surprising that the deficit widened,” said an economist contacted by Togo First.
It should be emphasized that Togo’s budget deficit had not reached such a level since 2016 where it stood at 6.09% of the GDP.
Regarding forecasts for 2021, Lomé expects the deficit to fall to 2.64% of the GDP by the end of the year. In detail, the government expects expenditures to come down to CFA1,050 billion, while revenues should rise by 7%, exceeding a little more than CFA960 billion.
Klétus Situ
Loans from banks and microfinance institutions stood at CFA770 billion last year
In 2020, loans provided by banks and microfinance institutions active in Togo stood at CFA770 billion. This was disclosed by the minister of finance, Sani Yaya, at the last meeting of the national council for credit (CNC), held on April 16.
In detail, loans given by banks slumped by about 11%, amidst the Covid-19 pandemic. Indeed, last year, they amounted to CFA590 billion, against CFA662 billion in 2019. However, while the weighted average interest rate remained the same over the period reviewed - 7.7% in 2019 and 2020 - some borrowers, notably financial clients, rural associations, and cooperatives, were charged higher interests, despite the ministry of economy’s warnings.
Regarding microfinance institutions, loans from these lenders stagnated over the period considered - increasing slightly from CFA179 billion to CFA180 billion. This is after growing for three consecutive years. The loan portfolio of these institutions deteriorated, with the interest rate standing at 8.3%, against the 3% standard.
According to data from the Central Bank of West African States (BCEAO), throughout the first quarter of 2020, loans given by microfinance institutions fell. However, as it became obvious that the Togolese population had to learn how to live with the coronavirus, borrowing resumed in the last quarter.
Séna Akoda
Construction of CimCo cement plant is 70% done
Started less than a year ago, the construction of Cimenterie de la Côte ouest-africaine (CimCo) is about 70% complete. As initially scheduled, the works should be over by September this year.
This was disclosed by the ministry of trade and industry on April 15. The announcement was made after Kodzo Adedze, minister of trade and industry, visited the construction site.
A total of 878 people, including 600 Togolese, are working to erect the factory which is a subsidiary of Cim Metal Group. The latter is owned by Burkinabe mogul, Inoussa Kanazoé.
The plant is projected to produce about 2.5 million tons of cement, every year. The overall cost of this project is CFA65 billion, CFA20 billion of which was secured from the BOAD as a loan. In the long run, the project should create 1,000 direct and 500 indirect jobs.
Authorities initiate automation of 10 new toll booths
In Togo, 10 new toll booths will be automated soon. This was announced by Societe Autonome de Financement de l’Entretien Routier (SAFER) which launched a tender in this framework.
The concerned toll booths are those of Sanguera, Vogan, Dzemenyi, Adeta Badou, Sotouboua, Alédjo, Défalé, Mango and Ponio. Just like the toll stations of Davié, (Zio prefecture) Vodougbé (Lacs), and Aképédo (Avé) which were recently automated, these booths will integrate modern payment terminals and be operated digitally.
The tender launched by SAFER aims to supply and set up automats for axle-counting, in line with the government’s recent decision to sanction and prohibit the circulation of heavy-duty vehicles that increase their axles without the “required permissions.”
Regarding the already-automated toll booths, they have magnetic payment terminals that accept subscription cards. Soon, an automatic deduction system will be set up but in the meantime, drivers can top up their cards using their phones.
Séna Akoda