Economy of Benin

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Economy of Benin
Currency	CFA Franc (XOF)
Fiscal year	Calendar year
Trade organisations	AU, ECOWAS, WTO
Statistics [1]
GDP ranking	144th (2004) [2]
GDP	$8.338 billion (2004)
GDP growth	5% (2004)
GDP per capita	$1,200 (2004)
GDP by sector	agriculture (36.3%), industry (14.3%), services (49.4%) (2004)
Inflation	2.8% (2004)
Pop below poverty line	33% (2001)
Labour force	N/A (1996)
Labour force by occupation	N/A
Unemployment	N/A (2003)
Main industries	textiles, food processing, construction materials, cement
Trading Partners [3]
Exports	$720.9 million (2004)
Export Commodities	cotton, crude oil, palm products, cocoa
Main partners	People's Republic of China 30.2%, India 15.6%, Thailand 6%, Ghana 5.9%, Niger 4.5% (2004)
Imports	$934.5 million (2004)
Imports Commodities	foodstuffs, capital goods, petroleum products
Main Partners	People's Republic of China 29.7%, France 13.8%, Thailand 7.2%, Côte d'Ivoire 4.6% (2004)
Public finances [4]
Public debt	N/A
Revenues	$869.4 million (2004)
Expenses	$720.4 million (1994)
Economic aid	$342.6 million (recipient)(2000)

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton Cotton accounts for 40% of GDP and roughly 80% of official export receipts. There is also production of textiles, palm products, and cocoa. Maize (corn), beans, rice, peanuts, cashews, pineapples, cassava, yams, and other various tubers are grown for local subsistence. Benin began producing a modest quantity of offshore oil in October 1982. Production ceased in recent years but exploration of new sites is ongoing. A modest fishing fleet provides fish and shrimp for local subsistence and export to Europe. Formerly government-owned commercial activities are now privatized. A French brewer acquired the former state-run brewery. Smaller businesses are privately owned by Beninese citizens, but some firms are foreign owned, primarily French and Lebanese. The private commercial and agricultural sectors remain the principal contributors to growth.

[edit] Economic Development

Since the transition to a democratic government in 1990, Benin has undergone an economic recovery. A large injection of external investment from both private and public sources has alleviated the economic difficulties of the early 1990s caused by global recession and persistently low commodity prices (although the latter continues to affect the economy). The manufacturing sector is confined to some light industry, which is mainly involved in processing primary products and the production of consumer goods. A planned joint hydroelectric project with neighboring Togo is intended to reduce Benin's dependence on imported energy mostly from Ghana, which currently accounts for a significant proportion of the country's imports. The service sector has grown quickly, stimulated by economic liberalization and fiscal reform. Membership of the CFA Franc Zone offers reasonable currency stability as well as access to French economic support. Benin sells its products mainly to France and, in smaller quantities, to the Netherlands, Korea, Japan, and India. France is Benin's leading source for imports. Benin is also a member of the West African economic community ECOWAS.

Despite its rapid growth, the economy of Benin still remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Growth in real output averaged a sound 5% since 1996, but a rapid population rise offset much of this growth on a per capita basis. Inflation has subsided over the past several years. Commercial and transport activities, which make up a large part of GDP, are vulnerable to developments in Nigeria, particularly fuel shortages.