|Subsistence agriculture and commerce are the main economic activities in
Togo; the majority of the population depends on subsistence agriculture.
Food and cash crop production employs the majority of the labor force and
contributes about 42% to the gross domestic product (GDP). Coffee and
cocoa are traditionally the major cash crops for export, but cotton
cultivation increased rapidly in the 1990s, with 173,000 metric tons
produced in 1999. Despite insufficient rainfall in some areas, the
Togolese Government has achieved its goal of self-sufficiency in food
crops--corn, cassava, yams, sorghum, millet, and groundnut. Small and
medium-sized farms produce most of the food crop; average farm size is one
to three hectares.
Commerce is the most important economic activity in Togo after agriculture, and Lome is an important regional trading center. Its port operates 24 hours a day, mainly transporting goods to the inland countries of Mali, Burkina Faso, and Niger. Lome's "Grand Marche" is known for its entrepreneurial market women, who have a stronghold over many areas of trade, particularly in African cloth. In addition to textiles, Togo is an important center for re-export of alcohol, cigarettes, perfume, and used automobiles to neighboring countries. Recent years of political instability have, however, eroded Togo's position as a trading center.
In the industrial sector, phosphates are Togo's most important commodity, and the country has an estimated 130 million metric tons of phosphate reserves. Togo exported 1.7 million metric tons of phosphates in 1999, mainly to South Africa, Canada, and the Philippines. Togo also has substantial limestone and marble deposits.
Encouraged by the commodity boom of the mid-1970s, which resulted in a four-fold increase in phosphate prices and sharply increased government revenues, Togo embarked on an overly ambitious program of large investments in infrastructure while pursuing industrialization and development of state enterprises in manufacturing, textiles, and beverages. However, following declines in world prices for commodities, its economy became burdened with fiscal imbalances, heavy borrowing, and unprofitable state enterprises.
Togo turned to the International Monetary Fund (IMF) for assistance in 1979, while simultaneously implementing a stringent adjustment effort with the help of a series of IMF standby programs, World Bank loans, and Paris Club debt rescheduling. Under these programs, the Togolese Government introduced a series of austerity measures and major restructuring goals for the state enterprise and rural development sectors. These reforms were aimed at eliminating most state monopolies, simplifying taxes and customs duties, curtailing public employment, and privatizing major state enterprises. Togo made good progress under the international financial institutions' programs in the late 1980s, but movement on reforms ended with the onset of political instability in 1990. With a new, elected government in place, Togo negotiated new 3-year programs with the World Bank and IMF in 1994.
Togo returned to the Paris Club in 1995 and received Naples terms, the club's most concessionary rates. With the economic downturn associated with Togo's political problems, scheduled external debt service obligations for 1994 were greater than 100% of projected government revenues (excluding bilateral and multilateral assistance). By 2001, Togo was embarked on an IMF Staff Monitored Program designed to restore macroeconomic stability and financial discipline but without any new IMF resources pending new legislative elections.
Togo is one of 16 members of the Economic Community of West African States (ECOWAS). The ECOWAS development fund is based in Lome. Togo also is a member of the West African Economic and Monetary Union (UEMOA), which groups seven West African countries using the CFA franc. The West African Development Bank (BOAD), which is associated with UEMOA, is based in Lome. Togo long served as a regional banking center, but that position has been eroded by the political instability and economic downturn of the early 1990s. Historically, France has been Togo's principal trading partner, although other European Union countries are important to Togo's economy.
GDP: purchasing power parity -
$7.3 billion (2000 est.)
SOURCES: The World Factbook, U.S. Department of State
Mother Earth Travel > Country Index > Togo > Map Economy History