Country Summary

Macroeconomic performance

Real GDP growth was an estimated 6.0% in 2018, up from 5.4% in 2017, due to good performance in agriculture, especially cotton (with 5.6% growth); the industrial sector (6.7%), driven by cotton ginning plants (18%); and the building and public works sector (8.5%). The services sector grew by 7.5% because of dynamism in transport, post, and telecommunications (with 10.6% growth); banks and other financial institutions (9.5%); and trade and the food and hotel industries (6.9%). On the demand side, growth was driven mainly by final consumption (up by 3.6%). The trade deficit fell slightly to 8.3% of GDP from 9.1% in 2017.

The budget deficit (including grants) declined to an estimated 4.7% of GDP in 2018, from 5.9% in 2017, due to mobilizing revenue (1.2% of GDP) and reducing current expenditures. Domestic debt (60% of total public debt) was 30.9% of GDP, and the risk of debt distress went from low to moderate. Benin operates a common monetary policy established by the Central Bank of West African States. The inflation rate increased to an estimated 1.6% in 2018 from 0.1% in 2017.

Tailwinds and headwinds

Real GDP growth is projected to be 6.3% in 2019 and 6.8% in 2020. Growth in the raw materials extractive sector is projected to reach 5.7% in 2019, driven mainly by the cotton sector. Industrial growth is projected to expand by 13.3% in 2019, owing to building and public works (growing by 25%) and the electricity and water sectors, projected to grow 8% as the 120 MW Maria-Gléta power plant begins production. The budget deficit is projected to level off at 2.6% of GDP in 2019 and 1.9% in 2020. Total public debt is projected to fall to 53.3% of GDP in 2019 and 48.9% in 2020. Under the 2017–25 Strategic Plan for the Development of the Agricultural Sector and the 2017–21 National Plan for Agricultural Investments, Food, and Nutrition Safety, seven agricultural development poles were created in 2017. The strategy to promote several subsectors—maize, rice, cotton, cashew, cassava, and pineapple—is ongoing.

Business creation procedures have improved. Electricity sector reforms initiated in 2016 should improve governance and double installed capacity to 500 MW by 2021. The gross enrollment ratio was estimated at 124.82% in 2015, and implementing the 2018–21 National Policy of Education should improve the sector. In the fight against HIV/AIDS, progress is visible, with prevalence estimated at 1%.

Benin is a member of the African Union, the Economic Community of West African States (ECOWAS), and the West African Economic and Monetary Union. Benin is highly integrated with the regional market: 70% of its exports go to the ECOWAS zone (mainly Nigeria). However, regional trade opportunities have been reduced since 2015 due to economic reforms in Nigeria removing oil and gas sector subsidies and banning the re-export of rice, used cars, and used clothing. The port of Cotonou remains a transit corridor for hinterland countries such as Burkina Faso, Mali, and Niger. Benin is also integrated into the regional capital markets and is host to subsidiaries of regional banking groups. The free movement of people remains hampered by unofficial border barriers, which raise transaction costs. The main challenges for the country are diversifying exports and modernizing trading services and trade and transport services.

Economic growth prospects are good but remain vulnerable to external shocks, especially rainfall, global cotton and oil prices, and changes in Nigeria’s economic situation.

Source: African Economic Outlook 2019

Fixed Income

Issuance strategy 

Benin is one of the eight countries of The West African Economic and Monetary Union (WAEMU).Bond issuance strategies vary from one state to another but most use the MTDS tool to develop their issuance strategy.

Benin’s public debt has been increasing rapidly since 2014. Total public debt (external plus domestic) increased from 30.5 percent in 2014 to 54.57 percent in 2018. The increase was primarily due to higher domestic debt driven by the scaling-up of public investment. At end-2018, about 80 percent of domestic liabilities consisted of government securities issued on the regional financial market . Benin issued its first Eurobond in March 2019, which is expected to change significantly the structure of the debt. The move from  domestic borrowing towards more market-based international is accompanied by the implementation of a number of reforms, including:

  • identifying and updating a targeted composition of debt (the share between domestic and external debt that strikes the right balance between costs and risks);
  • providing clear indication of future plans regarding foreign and domestic markets debt issuance to meet the targeted debt composition
  • better anticipating and planning for debt rollover and avoiding bunching of maturities establishing plans for active liability debt management (facilitated by the access to international markets);
  • nurturing an active investors relationship, including by strengthening public financial management and public debt transparency practices (e.g., publishing information on the composition of public debt in a timely manner).

With a continued fiscal consolidation and strong economic growth,the public debt ratio is expected to start declining from 2019.

Governements securities issuance programs are focused on  tenors from 3 months to 6-7 years and characterized by securities with repayments by amortization and deferred coupon as for the most o the WAEMU Countries.

Benchmark issues 

For the moment, there is no benchmark maturity in the WAEMU. The region is in the assessment phase of developing a yield curve. WAEMU countries understand that issuance policies need to evolve towards considering the need for a yield curve. 

Yield curve 

Yield curve calculation models 

There is no benchmark yields curve in the WAEMU Zone. 

Interpolation methods 

As there is no yield curve in the WAEMU, no method for interpolation is in use. 

Yield curve managed by

Agence UMOA-Titres is responsible for the yield curve. 

Display platform 

There is no yield curve in the WAEMU. 

Challenges in building an efficient yield curve 

  • Market fragmentation: fragmented securities market and non-standardized securities. 
  • Price discovery issue
  • Narrow investor base: comprising homogeneous investors such as banks. 
  • Limited and illiquid secondary market: nonexistent secondary market where the securities are acquired for "buy and hold”. 
  • Coexistence of two agencies for issuing bonds and bills: The “Conseil Régional de l’Epargne Publique et des Marchés Financiers” (CREMPF) is in charge of monitoring the syndication. The Agence UMOA-Titres is responsible for auctions.

Guide to Buying Bonds

Procedures for market participation

The frequency of auctions is determined by the states, together with the Central Bank. Each state cannot hold T-Bills and Government bonds auction more than once a week.

For Treasury Bills, a calendar program specifying the instruments and their amounts and maturities, is published quarterly by the Minister of Finance in consultation with the Central Bank, and in consideration mainly the foreseeable revenue and government spending. Whereas Treasury bonds, an indicative issuance calendar specifying the instruments and their amounts and maturities, is set annually by the Minister of Finance in consultation with the Central Bank.

Each issuance should be advertised at least 7 days before the auction by describing the issuance characteristics. Bidders submit to the Central Bank, sealed in a ballot box reserved for this purpose, a submission form specifying the amounts and the interest rates or the price offered. Submissions may also be made electronically in the conditions defined by the Central Bank.

Later than one hour after the deadline for bids submission, the National Directions of the BCEAO transmit electronically, by fax or any other means of rapid communication accepted by the Central Bank, the main submissions to the principal agency of the BCEAO, which is organizing the auction.

Treasury bills are eligible for refinancing by the Central Bank. Investors and the Central Bank may buy or sell Treasury bonds on the secondary market, awarded by private treaty. In this context, they are required to post the purchase price and sale which they are willing to transact.

Treasury bonds can be traded on the secondary market. As such, they can be exchanged at the Regional Stock Exchange (BRVM) or outside the BRVM.

Settlement cycle

The settlement date is T+1 for domestic operations and T+3 for operations between Members of the Union. This period can be modified by BCEAO. However, the contracting parties are free to agree on a minimum term above to unwind their operations. If the instructions given by the two parties are identical, the operation is definitely offset the value date agreed. In case of discrepancy between the evidences, the Central Bank suspends the transaction and notifies this decision to both parties for correction. Central Bank ensures the existence of adequate provisions before executing the compensation requested. Transmission to the Central Bank of notifications occurs in the selection of speakers, fax, telex, ordinary mail or any other means of rapid communication accepted by the BCEAO.


Treasury bills and Treasury bonds incomes are tax-free throughout the territory of the Member States of the WAEMU. But for non-members, the tax rates are different from one country to another. In Benin, the tax rate one securities income is equal to maximum 6%.


Rating agency Rating Outlook
Moody’s B Positive
Fitch B2 Positive
Standard and Poor’s B+ Stable

Primary Dealers

There is no appropriate Primary Dealers System in the WAEMU zone.

Subscription of Treasury bills is reserved to banks, financial institutions as well as regional financial institutions with an ordinary current account in the books of the Central Bank. Other investors, physical or legal persons, whatever their country of origin can also purchase Treasury bills in the primary market through banks located in the territory of the Union.

The primary subscription of Treasury bonds is restricted to banks, financial institutions, regional organizations and financial management company and intermediation (IMS). Other investors, physical or legal persons, whatever their country of origin may also purchase Treasury bonds on the primary market through banks and brokerage firms (SGI) located on the territory of the Union.

Market restrictions

Openness to international investors

The members of the zone are actively encouraging foreign investment. Foreign companies are free to invest and list on the regional stock exchange (BRVM), which is based in Abidjan and is dominated by Ivorian and Senegalese firms. 

Capital controls

There are no significant limits on foreign investment nor are there generally differences in treatment of foreign and national investors, either in terms of the level of foreign ownership or sector of investment.

Restriction on FX and profit repatriation

WAEMU has unified foreign exchange regulations. Under these regulations, there are no restrictions for transfers within the community, and designated commercial banks are able to approve routine foreign exchange transactions inside the community. The transfer abroad of the proceeds of liquidation of foreign direct investments no longer requires prior governments approval.

Documents & Resources

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