Reviving Togo's economy

A call for improvement in the Togolese business climate, infrastructure investment, agricultural productivity and service industry

The Togolese economy has undergone difficult times, the most severe being the period of suspension of international financial assistance between 1992 and 2007, during which the main sectors of the economy deteriorated significantly. With the resumption of cooperation after the 2007 legislative elections and the return of financial assistance, many efforts were undertaken to jumpstart the economy. In pursuit of these aims, the Togolese Government commissioned a Diagnostic Trade Integration Study (DTIS) - titled 'Revive the Traditional Sectors and Lay the Foundation for the Future: A Strategy for Export-led Growth' - with the goal of reviewing all key sectors of the national economy in order to identify the main constraints to spurring economic growth in Togo and to take the necessary measures to tackle those constraints.

 

Improving the business climate and developing skills


In general, with respect to the business climate, Togo’s position on the Doing Business ranking has improved little over the past five years. Research shows that access to credit constitutes one of the biggest challenges for the private sector and impedes enterprise development. Weaknesses are also noted with regards to the fight against corruption, protecting investors, and starting a business. In addition, a survey of businesses revealed that 60 per cent believe that the courts are neither impartial nor free from corruption. The report indicates that more attention should therefore be paid to the professionalisation of commercial courts and the application of commercial law.


It is undeniable that the private sector’s contribution to economic growth is vital. However, the skills available on the market are not adapted to the demand. The report addresses the low quality of instruction and high unemployment rate, and indicates that it is important to establish a more effective link between the private sector and vocational training. This can be accomplished through internships, the involvement of the private sector in designing post-secondary training programs, and improvements to the quality of teaching provided in private training institutions.

 

Upgrading infrastructure and lowering costs


On the subject of infrastructure, the report made a number of observations, of which the following are the most significant. Electricity rates are well above the regional average, which jeopardises Togo’s competitiveness in the manufacturing industry where electricity is a key input. With respect to communications (landlines, mobile telephones, Internet access), costs are very high relative to other countries in the sub-region where there is more openness and competition in the mobile telephone sector is greater. As for the road network, major construction and rehabilitation works are necessary, as well as effective maintenance. The report notes the importance of the Port of Lomé and recommends improvements aimed at maintaining its competitiveness. In light of the normalisation of the situation in Abidjan and the reforms underway in Ghana, greater streamlining of procedures and their incorporation into the establishment of a one-stop shop for all import/export operations are taking on a sense of urgency.

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