Togo’s economy has expanded at a healthy rate and showed growth of 5.3% in 2015. A growth rate of 5% is expected this year (2016).
The International Monetary Fund (IMF) says in its November 2016 report public investment initiatives and increases in productivity in the agricultural sector have been the key drivers of growth. Inflation was well contained at 1.8% in 2015, explained by the lower petroleum and transport prices.
According to the IMF staff team, led by Ms. Cemile Sancak, who visited the capital Lomé October to November discussion with Togolese authorities and other stakeholders focussed on policies and structural reforms to promote sustainable and inclusive growth and to maintain macroeconomic and financial stability.
Economic growth is expected to increase gradually to 5.6 percent by 2021, with the economy reaping the benefits of an improved transportation network and productivity gains in the agricultural sector.
The IMF report says the private sector is expected to play an increasing role as the engine of growth. Inflation remains well contained, forecasted at 2.1% in 2016 and should remain moderate in coming years.
“With the improvement in the fiscal stance, public debt is expected to be reduced from 75.4% of GDP in 2015 to 56.4% of GDP by 2021… Key structural reforms include leveraging the Revenue Authority (Office Togolais des Recettes) to modernise revenue administration, accelerating implementation of key measures in public financial management, including debt management, and improving public investment management,” reads the report.
The IMF, however, warned that a stricter enforcement of the current regulatory framework is needed in the financial sector. “Banks that are not currently in full compliance with prudential ratios need to take immediate remediating actions. Financial stability of the microfinance sector also needs to be improved, starting by strengthening the supervisory body for microfinance institutions in the Ministry of Finance.”