Economic Outline

Economic Indicators

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

In recent years, Burkina Faso experienced strong economic growth, driven by gold and cotton production. The coronavirus crisis negatively impacted this dynamic, as GDP growth slowed down to an estimated 1.9% in 2020 (IMF). Boosted by high gold production levels and prices and rising agricultural output, activity rebounded strongly in 2021 (6.7%) and is expected to remain robust in 2022 (5.6%) and 2023 (5.3%) (IMF). However, the January 2022 military coup could be economically disruptive in the short term (The Economist Intelligence Unit).

To face the Covid-19 pandemic, the government has launched a recovery plan estimated at FCFA 394 billion, including social measures such as exoneration on water and electricity bills and subvention to food prices. This plan, the drop in fiscal revenues and increasing security costs have affected the state’s resources. Public deficit rose to -5.7% GDP in 2020 and remained at a high level in 2021 (-5.6% GDP) (IMF). It is expected to reduce gradually to -4.8% GDP in 2022 and -4% GDP in 2023 before returning under the WAEMU criterion of 3% by 2024 (IMF, World Bank). The higher deficit led to an increase in the public debt, which reached 48.2% GDP in 2021 and is expected to further rise to 48.9% GDP in 2022 and 49.1% GDP in 2023 (IMF). Inflation turned positive in 2020 due to the pandemic, driven by high food prices and an increase in rental costs and energy prices (World Bank). Estimated by the IMF at 1.9% in 2020, it reached 3% in 2021 and is forecast to gradually decrease to 2.6% in 2022 and 2.5% in 2023 (IMF). The 2022 budget focuses on education, security and defence, health and rural development. Reducing poverty and violence related to the jihadi insurgency is a major challenge. Besides, the National plan for economic and social development is channelling public investments in road infrastructures and construction. Burkina Faso's economy is hampered by its faulty infrastructure, including electrical infrastructure. The country is also vulnerable 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, around 40% of the population still lives below the poverty line of USD 1.25 a day. In recent years, the country has made considerable progress in the area of education. The completion rate in primary schools is 64.3% for girls and 56.6 % for boys. Nevertheless, insecurity and terrorism are taking a heavy toll in several regions of the country, negatively affecting the education sector. More than 1.4 million persons have been internally displaced, and by May 2021, more than 10% of educational institutions were closed because of the insecure environment (World Bank). In 2020, the unemployment rate in the country was at 5% (ILO estimate).

Any Comment About This Content? Report It to Us.