Togo

Sustained strong growth thanks to investment

Economic growth is expected to remain robust in 2026. Public and private investment in infrastructure—port modernisation, road network improvements, and development of the Adétikopé Industrial Platform (AIP)—will boost exports (phosphates, soybeans, textiles) and re-exports, consolidating the country’s role as a regional transit hub. Work to rehabilitate the Lomé-Cotonou (Benin) highway continues as part of the Abidjan-Lagos corridor project, designed to open up production areas and facilitate regional trade flows. The new Public Investment Program (PIP 2026-28) also provides for increased social spending, enhanced counterterrorism capabilities of the military, and rural electrification. Industry (21% of GDP) is expected to continue expanding. Agribusiness and textiles will continue to develop in special economic zones, while the mining sector, which accounts for a small share of the economy, is expected to gain further momentum. The government is particularly counting on accelerating the local processing of phosphate, the main export product. In addition, manganese production at the Nayéga mine began in July 2025, with volumes expected to range between 4,000 and 8,000 tonnes per month between 2025 and 2030. Agriculture (20% of GDP) could benefit from a rebound in cotton production. On that score, the government aims to bring production closer to its record level of 2018-19 (over 140,000 tons), whereas it is currently struggling to sustainably exceed the symbolic threshold of 60,000 tonnes. To support the 2025-26 season, the government is maintaining incentive prices for producers (300 CFA francs per kilogram of seed cotton and 14,000 CFA francs per bag of fertiliser) and plans to increase fertilizer use (85,000 tons projected). These measures also aim to address the challenges of food sovereignty and rural resilience. Last, private consumption is expected to remain strong, supported by moderate inflation.

In 2025, inflation reached its lowest level since 2017 on back of falling energy and food prices and improved local harvests. However, price levels in 2026 will be subject to upside risks related to weather conditions, as well as regional security and geopolitical tensions. The outbreak of war in Iran in February 2026 sent global oil prices soaring. The persistence of the conflict could reignite imported inflation for this country, which is dependent on oil imports.

Fiscal consolidation on track

In light of ongoing jihadist incursions in the north of the country, the authorities will continue to allocate significant resources to the military sector, while maintaining a high level of public investment, particularly in infrastructure. However, the budget deficit is expected to narrow further and move closer to the regional convergence criterion of 3% of GDP. This improvement reflects increased revenue from transshipment activities at the Port of Lomé, as well as the ongoing fiscal consolidation undertaken under the IMF’s Extended Credit Facility (ECF) program, signed in March 2024 for 42 months for a USD 390 million allocation. The 2026 budget (EUR 4 billion, a 14% increase from the previous budget) calls for a gradual reduction in subsidies, particularly for electricity, public utilities, and fuel, and maintains the cap on the public payroll at 15% of GDP. Social spending will remain a priority, as it is expected to account for nearly half of the national budget. However, the rationalisation of fuel subsidies—which called for a 40% reduction by 2026—could be derailed by soaring oil prices caused by the war in Iran. On the revenue side, the government aims to boost revenue collection through new measures: electronic invoicing for VAT collection, the introduction of a 5% withholding tax on high gambling winnings, and the application of new export taxes on raw agricultural products. VAT reform is also continuing, with tighter exemptions on feed and inputs for livestock farming and fishing. The government also plans to raise excise taxes (on tobacco and used vehicles) and expand the property tax base. The goal is to increase tax revenue by at least 0.5% of GDP each year. After peaking in 2024, the public debt-to-GDP ratio is expected to gradually decline thanks to prudent management. Aware of their high exposure to the regional market (60% of public debt), the authorities are seeking to increase the share of external debt, which offers longer maturities and lower interest rates. The authorities therefore aim to contain high debt service fees (14% of GDP), a consequence of tightening regional financing conditions. The IMF estimates that the risk of over-indebtedness, both overall and external, will remain moderate, supported by robust growth, continued fiscal consolidation and the rebuilding of regional reserves. These reserves are gradually recovering after reaching particularly low levels, standing at about six months of imports by the end of 2025. Despite this improvement, Togo remains exposed to significant short-term refinancing pressures.

The trade deficit (12% of GDP) is structural due to the country’s heavy reliance on imported consumer and capital goods, but it narrowed in 2025 thanks to a recovery in cotton production, the expansion of agricultural processing and improved terms of trade. The latter was attributable to the decline in global oil and food prices at the time, as well as the currency’s peg to the euro, which appreciated against the dollar. The trend is expected to continue overall in 2026, although a higher average oil price as a result of the war in Iran could make imports more expensive. Togo also benefits from a structural surplus in services (3% of GDP), supported by transit trade and tourism, as well as a significant surplus in the secondary income account (6% of GDP) thanks to expatriate remittances. The current account deficit is therefore expected to narrow further in 2026. Progress in implementing reforms supported by the IMF’s ECF is bolstering external confidence and will enable Togo to access regional and external financing, whether concessional or not.

Regime change and persistent security risks in the North

At the April 2024 legislative elections, the Union pour la République (UNIR)—the party of President Faure Gnassingbé, who has been in power since 2005—won 108 of the 113 seats in the National Assembly. In May 2024, the Assembly passed a constitutional reform transforming the system from a presidential to a parliamentary one. In the country’s very first Senate election in February 2025, UNIR won 34 of the 41 seats in the ballot (the other 20 being filled by appointment). In May 2025, as leader of the majority party, Faure Gnassingbé was appointed by the Assembly to the presidency of the Council of Ministers, a newly created position that now concentrates most of the executive power. The absence of term limits and the Gnassingbé family’s presence at the helm of the country since 1967, combined with control over the security forces and political and judicial institutions, suggests that he will remain in power for the long term. The government also benefits from visible economic and social progress. Last, also in May 2025, Jean-Lucien Savi de Tové, the only candidate running for office, was elected by 150 members of Parliament as President of the Republic, a role that has become largely symbolic since its powers were minimised by the 2024 reform.

In terms of security, the North of the country continues to suffer from jihadist incursions due to the porous border with Burkina Faso. The state of emergency declared in the Savanes region in 2022 has been extended until March 2027. However, violence will be restricted to the border region and the authorities will maintain effective control over the area.

Togo is gradually strengthening its ties with the member countries of the Alliance of Sahel States (AES) - Burkina Faso, Mali and Niger - and is taking a more conciliatory stance toward their military juntas, notably due to the fact that it relies heavily on trade with group members. Togo will also continue its special relationship with China, its main supplier, bilateral creditor and major investment partner. The two countries are currently working on finalising a protocol to facilitate access for Togolese soybeans to the Chinese market. According to the Chinese authorities, the approval process was in its final stages by the end of 2025. Furthermore, Togo and Russia have strengthened their ties. In November 2025, Faure Gnassingbé met with Vladimir Putin in Moscow to announce the opening of their respective embassies. However, relations with the West, particularly France and the US, have been unaffected. Last, the country’s economic performance and its ability to implement economic reforms—highlighted by the IMF’s commitment—will continue to bolster positive sentiment among international investors and donors.

Last updated:March 2026