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Select Economic and Financial Indicators 2014 2015 2016 2017e 2018f
Real GDP (% change) 5.4 5.3 5.0 5.0 5.3
GDP (USD bn) 4.6 4.2 4.4 4.8 5.3
Inflation (average) 0.2 1.8 0.9 -0.9 1.2
Fiscal Balance (% GDP) -6.8 -8.9 -9.6 -4.6 -2.7
Broad Money (% change, end period) 9.8 20.2 12.9 12.5 12.7
Population (mn) 7.2 7.4 7.6 7.8 8.0
Exports (USD bn) 1.8 1.5 1.6 1.6 1.8
Imports (USD bn) 2.6 2.4 2.4 2.5 2.7
Current Account Balance (% GDP) -9.9 -11.1 -9.7 -8.3 -7.3
FX Reserves (USD bn, end period) 0.6 0.6 0.4 0.5 0.6
Exchange Rate (average) 496.1 594.3 600.7 588.9 565.1
Sources: IMF, World Bank, UN, Bloomberg, Ecobank Research

Economic outlook

Economic outlook

Real GDP: Economic conditions remain relatively good and growth will likely remain reasonably strong based on productivity gains in the agricultural sector, port activity, and public investment in infrastructure. As a result, real GDP could continue to expand at above 5% in 2018. Growth will be driven by public investment aimed at filling infrastructure gaps, particularly in the area of transport network. However, protests starting in late 2017 against the incumbent President Faure Gnassingbé (and calling for the introduction of presidential term limits) somewhat raise concerns over the outlook. While the protests do not pose an imminent threat of growth rates below recent trends, an extended period of civil unrest (should the situation deteriorate) would weaken Togo’s economic potential. Also, while the pace of public investment has laid the basis for higher growth it has also contributed to a pronounced increase in public debt and current account deficits.

Inflation: is projected to rebound in 2018, following a decline in prices in 2017. The rise in domestic prices will come partly from higher global oil prices. However, inflation is likely to remain below the Union Economique et Monétaire Ouest-Africaine (UEMOA) convergence criterion of 3%, amid an EUR strengthening bias in 2018 (the XOF is pegged to the EUR).

Fiscal balance: The fiscal deficit is projected to narrow further in 2018, after registering below 5% of GDP in 2017, from 9.6% in 2016. This progress will be supported by IMF-advised reforms (as part of Togo’s Extended Credit Facility arrangement with the IMF, approved in May 2017) aimed at improving public financial management and debt management. Total public debt is expected to further decline to below 75% of GDP in 2018, from a peak of around 80% of GDP in 2016, as fiscal reforms will help to reduce the debt thereafter. This includes broadening the tax base, strengthening government procurement and budgetary processes, and government commitment to desist from guaranteeing new non-concessional external debt.

Current account: The current account deficit is likely to remain large in 2018 amid a mild recovery in global oil prices, capital goods imports linked to public investment and a relatively lacklustre export performance.

Risks

A protracted period of political unrest could undermine the country’s growth prospects by stifling economic activity and deterring investment. Weak effort to implement public financial management reforms will pose a risk to the fiscal consolidation programme. Moreover, there is a risk that strong growth over the medium term will increase current account and debt pressures that may become unmanageable. Finally, another sharp slowdown in Nigeria’s prospects would undermine Togo’s growth outlook given strong trade and informal links between the two countries.

FX, FI and Commodity Information

FX, FI and Commodity Information

Exchange Rate Structure

Regime Fixed
Target XOF655.957 to EUR1
Type of intervention Via Central Bank
Convertible currency? Partial
Market participants Corporates (70%); Interbank (30%)
Source: Bloomberg, IMF, BCEAO, and Ecobank Research

FX

FX Products Spot Forwards Non-deliverable Forwards Options Swaps
On offer Yes Yes No No No
Daily trading volume (USD mn) n/a n/a
Average trade size (USD mn)
Average spread
Trading hours Limited
Settlement cycle T+2
FX Market Structure BCEAO’s exchange regime is free of restrictions on payments and transfers for current international transactions, apart from restrictions maintained for AML and Exchange control.
Non-resident FX Regulations Spot Forwards Non-deliverable Forwards Options Swaps
Trade and FDI flow No restrictions No restrictions  
Financial flow  
Resident FX Regulations Spot Forwards Non-deliverable Forwards Options Swaps
Trade and FDI flow No restrictions No restrictions  
Financial flow      
Source: Bloomberg, IMF, BCEAO, and Ecobank Research

FI

Primary Market Treasury bills Treasury notes Treasury bonds Central Bank bills OMOs
Issuer Government and Financial Institutions NA
End use Government financing n/a Government & infrastructure financing n/a
Maturity structure 90-days to 2-years 3 – to 11-yrs
Coupon Fixed Fixed
Coupon payments Discounted Annual / Semi Annual
Secondary Market  
Daily trading volume n/a n/a
Average trade size n/a
Settlement cycle n/a
Ecobank local affiliate contact details:
Ecobank Togo, 20 Avenue Sylvanus Olympio, Lomé
Tel: +228 22 21 72 14
Source: Bloomberg, IMF, BCEAO, and Ecobank Research

FI primary market information

FI primary market information

Togo Debt 2014 2015 2016 2017e 2018f
Government debt (% GDP) 65.2 75.6 79.1 76.6 72.4
 Sub-Sahara average 44.3 51.5 54.7 54.8 54.8
External debt (official creditors, % GDP) 17.1 21.1 19.7 22.9 24.8
 Sub-Sahara average 25.4 29.5 31.3 33.0 33.4
External public debt stock (USD bn) 0.8 0.9 0.9 1.0 1.2
 Share of total sub-Sahara debt (%) 0.3 0.4 0.4 0.4 0.5
Source: IMF; Ecobank Research

Commodity and trade information

Commodity and trade information

Hydrocarbon & mineral production

Phosphate has long been Togo’s most valuable mineral export, representing up to 11% of foreign exchange earnings. Although output has fallen in recent years, a total of 846,091 tonnes was exported in 2016, most of which went to India and Canada. Production could rise following the Togolese government’s award of the US$1.4bn integrated phosphate/fertiliser project to Israeli mining company, Elenilto. The Kpeme concession has an estimated 2bn tonnes of phosphate reserves, but no start date for production has yet been announced. Togo is also a major producer of cement for the sub-region, with exports of 860,081 tonnes in 2016. Togo also produced 14 tonnes of gold in 2016, all of which went to the UAE and Lebanon for re-export.

Togo has no known hydrocarbon reserves, despite major discoveries in neighbouring Ghana and Nigeria. However, Togo has signed production sharing contracts with Italian oil major, ENI, for two oil blocks in the deepwater Dahomey Basin. The two blocks are believed to hold similar potential to the Tano basin in Ghana, in which the Sankofa field lies. Togo consumes over 350,000 tonnes of petroleum products annually. As the country has no refinery, all of its petroleum products are imported (USD232mn in 2016). Ghana and Côte d’Ivoire are Togo’s two largest trading partners in Africa for fuel.

Soft commodity production

Togo is a small-scale agricultural producer, with low output of cash crops. The country is West Africa’s seventh largest cotton producer, with output of 35,000 tonnes of cotton lint in 2016/17, all of which was exported to South-East Asia and China for thread spinning. Togo also produces small volumes of cocoa, averaging around 12,000 tonnes per season, as well as coffee (7,150 tonnes in 2016), and milled rice (80,000 tonnes in 2016).

Trade flows

Imports

Togo’s imports totalled US$1.7bn in 2016. Given the country’s lack of refining capacity, Togo is dependent on imports of petroleum products, worth US$233mn in 2016. The country is also reliant on imports consumer and capital goods, led by vehicles & machinery (US$368mn), electronics (US$119mn) and pharmaceuticals (US$89mn), as well as industrial raw materials, including iron & steel (US$110mn) and plastics (US$104mn). This reflects the poorly-developed manufacturing sector and the country’s role as a re-export hub for the region, especially to neighbouring Nigeria. The country also imports large volumes of rice and wheat, worth US$43mn in 2016, as well as fertilisers (US$60mn) and cotton for re-export (US$40mn). Given the free movement of goods between Togo and its ECOWAS neighbours, large informal flows (notably of fuel and rice) are not captured by official data.

Exports

Togo’s exports totalled US$715mn in 2016. This was similar amount to the previous year earlier but 38% below the peak achieved in 2013 (US$1.1bn) when the country exported more ships, cement and iron & steel to neighbouring countries. Like Benin, Togo is a major trade hub for the West African region, and a large proportion of its trade flows is not captured by official data. Togo is a major exporter of cement (US$137mn in 2016), cotton (US$53mn) and phosphate rock (US$81mn), most of which is produced in Togo. The country’s exports of plastics (worth US$95mn), vehicles & machinery (US$76mn), cosmetics (US$49mn) and food are all re-exports of goods imported from the global market, with the majority going to neighbouring Ghana and Nigeria.

  • Flag
  • Population
    7,990,926
  • Area
    56,785 km2
  • Capital
    Lomé
  • Largest city
    Lomé
  • Official language
    French, Ewe, Kabiyé
  • Major languages
    Mina, Dagomba
  • Currency
    West African CFA Franc (XOF)

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