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Benin Government Action Programme gains momentum

In 2021, the Government of Benin launched an action plan dubbed PAG 2021-26 to boost economic and social transformation of the country. The Government of Benin had indicated a plan to spend over US$20 billion in the programme, which is 33% higher than the previous allocation.

The Benin Government Action Plan is important because it is the only operational planning instrument at the national level which will guide government actions. The PAG 2021-26 will schedule activities of government ministries/entities while spending a little lesser than half of the announced spending from the government budget. The private sector will be roped in for the other half of the investments. The vision document states that through the investments, Benin will “achieve a double-digit rate of growth and to generate directly and indirectly more than 1.3 million jobs.”

It is a wholesome plan that has three pillars. The first pillar will strengthen democracy, rule of law and good governance. The second pillar is aimed at structural transformation of the economy through a stable macroeconomic framework, growth and quality education. The third pillar concerns people through achievement of sustainable development goals, climate plans and human development. In addition, the 3 pillars have 7 lines of implementable goals that have been stated in the plan.

The vision document also highlights that the current plan will be implemented on a management approach which “places greater emphasis on the responsibility of participants and good governance. For this purpose, the monitoring mechanism will be strengthened in the areas of strategic guidance and alignment of actions and projects with the goals pursued.” Coming to economic growth, the plan predicts the rate of growth of the Beninese economy to be 10.2% in 2026, or an average of 8.3% for the 2021-2026 period. The rate of growth in 2020 was 3.8% in 2020 while the nominal debt was 49.2% in 2021. The plan predicts the debt to come down to 38.2% by 2026.
The consolidation of the economy will help the African country navigate the challenges of the future, if the plan is successful. To make sure of this, the Ministry of Development and Coordination of Governmental Action is responsible for planning the implementation of the Programme and coordination of executive action. It ensures evaluation of the Programme and recommends necessary adjustments.
The document clearly cites multiple reforms that will be undertaken in the coming years. It will range from sectors like justice, public service, decentralization, security, defence, diplomacy, economic & finance, infrastructure & transport, electricity, digital, agriculture, arts & culture, handicraft, tourism, industry & commerce, mines & hydrocarbons, small & medium-sized businesses, education, social welfare, health, water, sports and living environment. Recently, the World Bank also allocated US$150 million in International Development Association financing to the Benin government for empowering women and girls, expanding access to sustainable energy and improve fiscal and debt management. Speaking about it, the multilateral body stated, “The new financing has been designed in alignment with the Beninese government’s 2021-2026 Action Plan, and especially the national development plan (2020-2025), one of the key pillars of which is the reduction of fertility in order to benefit from the demographic dividend.”

In a report, Fitch Solutions said that the real GDP growth of Benin will remain robust at 6.3% in 2022 while it will decelerate to 5.9% in 2023 due to efforts by the government at fiscal consolidation. Speaking about the current scenario and post-pandemic recovery, the report also said, “Strong public expenditure will support fixed capital formation, while the easing of pandemic-related restrictions and high cotton prices will boost household consumption.”

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