Burkina Faso flag Burkina Faso: Visió econòmica i política

El context econòmic de Burkina Faso

Economic Indicators

In recent years, Burkina Faso has witnessed robust economic growth driven by gold and cotton production. However, the trajectory was disrupted by the coronavirus crisis followed by political and security challenges, which had adverse effects. Despite a slowdown in 2022 (+1.5%), economic growth rebounded to 4.4% in 2023 (IMF), primarily propelled by the agriculture and services sectors. Notably, cotton production, which had suffered from insect infestation in 2022, played a pivotal role in revitalizing the agricultural sector. The resurgence of gold production, constituting 78% of exports in 2021, alongside the reopening of previously closed mines due to security concerns and the government's renewal and allocation of new operating licenses, holds the potential to drive growth to 6.4% in 2024. However, this optimistic economic forecast is contingent upon persistently high levels of political and security instability.

In 2022, the economic recovery was marred by two military coups, justified by its perpetrators by the government's inability to contain the jihadist insurgency. Against the backdrop of political instability, expenditures on defense and security are expected to remain substantial. While the budget deficit is projected to decrease over the forecast horizon, it will remain elevated and surpass the standard set by the WAEMU community, which is 3% of GDP. However, increased tax revenues stemming from stronger economic growth and initiatives aimed at broadening the tax base (Coface) will partially offset this deficit. The Extended Credit Facility (ECF) agreement with the IMF, finalized in June 2023 with a disbursement of USD 305 million spread over 4 years, will support the country's ongoing efforts toward fiscal consolidation. Although considered sustainable, public debt will continue to be vulnerable to political instability, constraining public spending and diminishing support from international donors. Estimated at 61.2% of GDP last year by the IMF, it should remain stable in the medium term.Inflation decelerated significantly in 2023 (from 14.1% in 2022 to 1.4%), thanks to moderating commodity prices and the tight monetary policy implemented by the BCEAO. This trend is expected to persist into 2024, aided by a more favorable agricultural harvest domestically, which should alleviate pressure on food prices, alongside continued adherence to a restrictive monetary policy. Burkina Faso's economy is hindered by its faulty infrastructure, including electrical infrastructure, and vulnerability to the volatility of oil import prices as well as gold and cotton prices. In the medium term, the country will have to modernize its public affairs management, readjust public finances, reform the financial system, and improve the business climate. Burkina Faso is considered to have a high risk of over-indebtedness, as it is extremely dependent on foreign aid.

According to the World Bank, more than 40% of the population still lives below the poverty line. In recent years, the country has made considerable progress in education. Nevertheless, insecurity and terrorism are taking a heavy toll in several regions, negatively affecting the education sector. More than 2 million persons have been internally displaced, and over 3 million people are in a situation of food insecurity. The latest estimates from the World Bank point to a 5.1% unemployment rate; however, the informal sector accounts for a large part of GDP in Burkina Faso, with around 70% of total non-agricultural employment.

 
Main Indicators 20222023 (E)2024 (E)2025 (E)2026 (E)
GDP (billions USD) 18.9320.7922.9224.8526.82
GDP (Constant Prices, Annual % Change) 1.54.46.46.05.6
GDP per Capita (USD) 8328889521,0051,054
General Government Gross Debt (in % of GDP) 58.361.261.261.460.9
Inflation Rate (%) n/a1.43.02.02.0
Current Account (billions USD) -1.17-1.06-1.18-1.20-1.21
Current Account (in % of GDP) -6.2-5.1-5.2-4.8-4.5

Source: IMF – World Economic Outlook Database, October 2021

Main Sectors of Industry

The economy of Burkina Faso is primarily based on agriculture, although the country also stands as Africa's 5th largest producer of gold. The agricultural sector contributes approximately 18.5% to Burkina Faso’s GDP and engages nearly three-quarters of the workforce (World Bank, latest data available). Approximately 26% of the population practices subsistence farming, with cotton being the primary cash crop, accounting for a substantial portion of export earnings. Other cash crops include groundnuts, shea nuts, and sesame, while staple crops encompass pearl millet, sorghum, maize, and rice. In 2023, aggregate cereal production reached around 5.2 million tonnes, as estimated by the FAO, maintaining levels similar to 2022 and marking a 4% increase over the average of the previous five years.

Burkina Faso's industrial sector is relatively small and nascent, contributing modestly to the nation's economy (28.7% of GDP and 7% of employment). Key subsectors comprise agro-processing, textiles, and mining. Agro-processing involves the conversion of agricultural products like cotton, shea nuts, and cereals into value-added goods such as textiles, edible oils, and processed foods, facing constraints like inadequate infrastructure and limited financing access. Textiles, historically vital to Burkina Faso's industry, have experienced decline due to competition from cheaper imports and insufficient modernization investment. Meanwhile, the mining sector, particularly gold mining, has witnessed substantial growth, attracting foreign investment and significantly contributing to export earnings and government revenue (gold comprises almost three-quarters of exports).

The services sector constitutes 42.7% of GDP and employs 19% of the total workforce. The finance sector is gradually expanding, with banks and microfinance institutions broadening access to financial services, although challenges such as limited credit access and financial inclusion persist, especially in rural areas. Burkina Faso's formal financial sector encompasses 13 banks, 4 specialized financial institutions, and 62 microfinance institutions, with banks holding nearly 70% of total financial assets, and the three largest banks collectively holding over 50% of the country's total financial assets. While still emerging, tourism presents significant growth potential.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 73.3 7.1 19.7
Value Added (in % of GDP) 20.4 29.3 40.9
Value Added (Annual % Change) 8.5 -5.5 5.3

Source: World Bank, Latest Available Data. Because of rounding, the sum of the percentages may be smaller/greater than 100%.

 

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Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.}}

Score:
56,5/100
World Rank:
124
Regional Rank:
21

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation

 
 

Country Risk

See the country risk analysis provided by Coface.
 

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Actualitzacions: March 2024

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