Economic highlights
- Important cotton market: presence of a strategic cotton market that represents 49.2% of the country’s exports in 2020 (about 1,285,000 tonnes per year with an increase of 11% compared to 2019). Benin is the fourth largest exporter of cotton in Africa behind Burkina Faso, Mali and Côte d‘Ivoire.
- Major commercial port of Cotonou: presence of a major commercial port in Cotonou, which makes up for the infrastructural deficiencies of the port of Lagos in Nigeria.
- Forestry and agriculture: timber and cassava represent, respectively, the second and third largest agricultural exports in Benin after cotton. The agricultural sector contributes 30.7% of GDP.
- Oil imports: The import of products derived from oil production is the second largest item of Beninese imports, accounting for 16.7% of GDP.
Macroeconomic framework
Benin‘s economy is based on cotton cultivation and tertiary activities in the port of Cotonou. Industrial production is limited.
In 2020, GDP amounted to EUR 13bn, broadly stable compared to 2019. The agricultural sector accounts for 30.7% of GDP, industry for 16% and the tertiary sector for 53.3% (EIU data March 2020). The main Beninese exports (as a percentage of total value) are cotton (49.2%), cashew nuts (11.2%) and gold (3.1%).
Cotton processing characterises the industrial sector, although it is affected by seasonal production trends and increased competition from Asian products. Private investment is still low, energy and transport infrastructures are poor and corruption is widespread.
53.3% of GDP comes from the tertiary sector, which is concentrated in the port of Cotonou, which generates high tax revenues.
GDP per capita went from $1,086 in 2016 to $1,225 in 2020. Population growth has greatly mitigated the increase in per capita income. The population increased from 10.9 million in 2016 to 12.1 million in 2020.
Exports amounted to EUR 2.5bn in 2020 (EUR 3.1bn in 2019). Imports increased from EUR 4.7bn in 2019 to EUR 4.0bn in 2020. The inflation rate increased from -0.9% in 2019 to -0.4 in 2020.
The short-term outlook is positive despite the presence of some risk factors. In particular, there are concerns about unpredictable weather conditions and their impact on agricultural production, as well as trade policy decisions in Nigeria, the main market for Beninese exports.
The main export destination markets are: Bangladesh (7.3%), China (7.3%), India (4.6%) and Vietnam (2.9%). The main suppliers are: India(15.6%), Thailand (10.8%), Togo (9.4%) and China (9.3%). Foreign direct investment remains very limited, averaging less than 2% of GDP.