Togo’s Economic Resilience and Green Growth: World Bank Report Insights

The World Bank's Togo's 2024 Economic Update: Building Resilience report highlights Togo’s steady economic growth, ongoing poverty challenges, and the critical role of climate-adaptive policies, particularly in agroforestry, to foster a sustainable and resilient economy. The report underscores that targeted reforms and green solutions can not only stabilize Togo's growth but also empower rural communities against climate-related adversities.

In a comprehensive look at Togo's economic progress and challenges, the World Bank’s Togo’s 2024 Economic Update: Building Resilience report sheds light on the country’s steady but cautious growth trajectory. While Togo has sustained growth, averaging around 5.1% since 2013, hurdles like climate volatility, poverty, and regional instability continue to shape the country’s economic landscape. As Togo charts a path toward resilience, the report emphasizes the importance of strategic investments, targeted reforms, and innovative solutions like agroforestry to address its socio-economic and environmental challenges.

Economic Progress Amid Structural Challenges

The report acknowledges Togo’s post-pandemic rebound, thanks to increased public spending and strategic investments, even as fiscal deficits linger. Growth climbed significantly after the pandemic, bolstered by state-driven fiscal policies. However, Togo’s economic momentum still lags behind regional peers such as Benin and Côte d'Ivoire, largely due to longstanding structural constraints. Low investment levels, limited industrialization, and stark urban-rural disparities in economic opportunities and access to services limit Togo’s growth potential.

Poverty reduction remains an ongoing struggle, especially in rural communities. Although poverty rates have seen slight decreases, the rural population, particularly in the Savanes region, faces high levels of food insecurity. The report stresses that empowering these regions through tailored economic reforms is crucial to bridging the poverty gap and enhancing social stability.

A Promising Growth Outlook with Notable Risks

Despite these structural challenges, Togo’s economic outlook is cautiously optimistic, with projections for growth stabilizing around 5.5% by 2026. However, the report warns of persistent risks. Global economic uncertainty and local challenges—such as slower demand from neighboring nations and a high dependency on regional markets—present obstacles. Additionally, Togo’s agricultural productivity remains at the mercy of climate-related events, with unpredictable rainfall patterns and rising temperatures posing real threats to crop yields.

To sustain growth and mitigate these risks, the report underscores the urgency of boosting public investment efficiency, implementing bold reforms, and continuing climate adaptation strategies. These efforts are seen as critical to sustaining Togo’s growth while insulating its economy from external shocks.

Agroforestry: A Green Solution for Climate Resilience

In the face of climate change, the report identifies agroforestry as a transformative approach that can both strengthen the agricultural sector and enhance food security. Agroforestry, a nature-based practice integrating trees with crops, can improve yields, restore soil quality, and promote carbon sequestration. The potential benefits are substantial, as converting suitable land to agroforestry could not only enhance food security but also directly benefit over 764,000 farmers by 2050.

This strategy could provide Togo with an adaptive shield against climate volatility, boosting crop production and reducing carbon emissions. However, these benefits require significant up-front investments and supportive policies that encourage smallholder farmers to adopt sustainable practices. According to the World Bank, investing in agroforestry now could yield returns in food security, climate resilience, and rural income that far outweigh initial costs, presenting a win-win for both Togo’s economy and its people.

Policy Recommendations: A Roadmap to Resilient Growth

The World Bank’s report outlines several key policy recommendations aimed at fostering sustainable growth and building economic resilience in Togo:

Public Investment Management: Improving budgeting processes, implementing rigorous project feasibility studies, and ensuring accountability in public spending can maximize Togo’s resources.

Revenue Mobilization: Strengthening tax policies, enhancing compliance, and exploring eco-taxes can increase revenue streams while discouraging environmentally harmful practices.

Promoting Agroforestry: Developing a national agroforestry plan, zoning strategies, and support for technical and financial assistance can help transition smallholders to sustainable practices.

Rural Electrification: Increasing the financial autonomy of energy agencies and supporting decentralized renewable solutions will advance Togo’s electrification goals, enhancing quality of life and economic opportunity in underserved regions.

These strategic reforms highlight a forward-thinking approach, leveraging limited public resources to catalyze growth, alleviate poverty, and build resilience against climate impacts. The emphasis on agroforestry reflects a shift towards nature-based solutions that address economic and environmental challenges, strengthening Togo’s potential to create a greener, more inclusive future.

As Togo continues its journey toward sustainable development, Togo’s 2024 Economic Update: Building Resilience, published by the World Bank, serves as a critical roadmap, providing actionable insights to navigate a complex economic landscape. Through structural reforms, climate adaptation, and a commitment to equitable growth, Togo can secure a resilient and prosperous future for its citizens.