Economy of Burkina Faso
TemplateStyles' src attribute must not be empty.
This article needs to be updated. (November 2024) |
Template:Infobox economy Burkina Faso has a developing, low-income economy. It is based primarily on subsistence farming and livestock raising.[1] Burkina Faso has a low average income level, with GDP per capita estimated at approximately $3,000 (PPP) and $1,100 (nominal) in the mid-2020s. More than 80% of the population relies on subsistence agriculture with only a small fraction directly involved in industry and services. Highly variable rainfall, poor soils, lack of adequate communications and other infrastructure, a low literacy rate, and a stagnant economy are all longstanding problems of this landlocked country. The export economy also remained subject to fluctuations in world prices.
The country has a high population density,[2] fragile soil,[3] and abundant natural resources like gold.[4][5] Industry remains dominated by unprofitable government-controlled corporations.[6] Following the African franc currency devaluation in January 1994 the government updated its development program in conjunction with international agencies, and exports and economic growth have increased. Maintenance of its macroeconomic progress depends on continued low inflation, reduction in the trade deficit, and reforms designed to encourage private investment.
Financial System Overview
The Burkinabé financial system represents 30% of the country's GDP and is dominated by the banking sector, which accounts for 90% of total financial system assets. Eleven banks and five non-bank financial institutions operate in the country.
The banking sector is highly concentrated, with the three largest banks holding nearly 60% of total financial sector assets. Banks are generally adequately capitalized, but remain vulnerable due to their overexposure to the cotton sector, the prices of which are subject to significant oscillations.
A December 2018 report from the World Bank indicates that cotton had become the most important cash crop, while gold exports were increasing in recent years. In 2017, economic growth increased to 6.4% in 2017 (vs. 5.9% in 2016) primarily due to gold production and increased investment in infrastructure. The increase in consumption linked to growth of the wage bill also supported economic growth. Inflation remained low, 0.4% that year but the public deficit grew to 7.7% of GDP (vs. 3.5% in 2016). The government was continuing to get financial aid and loans to finance the debt. To finance the public deficit, the Government combined concessional aid and borrowing on the regional market. The World Bank said that the economic outlook remained favorable in the short and medium term, although that could be negatively impacted. Risks included high oil prices (imports), lower prices of gold and cotton (exports) as well as terrorist threat and labour strikes.[7]
Agriculture
Burkina Faso produced in 2018:
- 1.9 million tons of sorghum;
- 1.7 million tons of maize;
- 1.1 million tons of millet;
- 630 thousand tons of cowpea (3rd largest producer in the world, preceded only by Niger and Nigeria);
- 490 thousand tons of sugar cane;
- 482 thousand tons of cotton;
- 329 thousand tons of peanut;
- 253 thousand tons of sesame seed (8th largest producer in the world);
- 240 thousand tons of vegetable;
- 160 thousand tons of rice;
- 103 thousand tons of cashew nuts (12th largest producer in the world);
In addition to smaller productions of other agricultural products.[8]
External trade
Industry, still in an embryonic stage, is located primarily in Bobo-Dioulasso, Ouagadougou, Banfora, and Koudougou. Manufacturing is limited to food processing, textiles, and other import substitution heavily protected by tariffs. Some factories are privately owned, and others are set to be privatized. Burkina Faso's exploitable natural resources are limited, although a manganese ore deposit is located in the remote northeast. Gold mining has increased greatly since the mid-1980s and, along with cotton, is a leading export money earner. However, both gold and cotton are listed as goods produced mostly by child labor and forced labor according to a recent U.S. Department of Labor report.[9]
Macro-economic trend
The following table shows the leading economic indicators from 1980 to 2024. Inflation below 5% is in green.[10]
Current GDP per capita[11] of Burkina Faso grew 13% in the 60s reaching a peak growth of 237% in the 70s. But this proved unsustainable and growth consequently scaled back to 23% in the 80s. Finally, it shrank by 37% in the 90s. Average wages in 2007 hover around 2 to 3 dollars per day.
Although disadvantaged by an extremely resource-deprived domestic economy, Burkina Faso remains committed to the structural adjustment program it launched in 1991. It has largely recovered from the devaluation of the CFA in January 1994, with a 1996 growth rate of 5.9%.
Many Burkinabé migrate to neighbouring countries for work, and their remittances provide a substantial contribution to the balance of payments. Burkina Faso is attempting to improve the economy by developing its mineral resources, improving its infrastructure, making its agricultural and livestock sectors more productive and competitive, and stabilizing the supplies and prices of cereals.
The agricultural economy remains highly vulnerable to fluctuations in rainfall. The Mossi Plateau in north central Burkina Faso faces encroachment from the Sahara. The resultant southward migration means heightened competition for control of very limited water resources south of the Mossi Plateau. Most of the population ekes out a living as subsistence farmers, living with problems of climate, soil erosion, and rudimentary technology. The staple crops are pearl millet, sorghum, maize, and rice. The cash crops are cotton, groundnuts, karite (shea nuts), and sesame. Livestock, once a major export, has declined.
A 2018 report by the African Development Bank Group discussed a macroeconomic evolution: "higher investment and continued spending on social services and security that will add to the budget deficit". This group's prediction for 2018 indicated that the budget deficit would be reduced to 4.8% of GDP in 2018 and to 2.9% in 2019. Public debt associated with the National Economic and Social Development Plan was estimated at 36.9% of GDP in 2017.[12]
Child labour
A 2023 Burkinabé government study found that in the north of the country, 30.1% of children work permanently in gold mine.[13]
See also
- Agriculture in Burkina Faso
- List of companies based in Burkina Faso
- United Nations Economic Commission for Africa
- List of banks in Burkina Faso
References
| File:Commons-logo.svg | Wikimedia Commons has media related to Economy of Burkina Faso. |
- ↑ "Burkina Faso". Retrieved 29 October 2019.
- ↑ "World Bank Open Data". World Bank Open Data. Retrieved 5 February 2026.
- ↑ Bassole, Zelbié; Yanogo, Isidore Pawendkisgou; Idani, Fulgence Talaridia (8 March 2023). "Caractérisation des sols ferrugineux tropicaux lessivés et des sols bruns eutrophes tropicaux pour l'utilisation agricole dans le bas-fond de Goundi-Djoro (Burkina Faso)". International Journal of Biological and Chemical Sciences. 17 (1): 247–266. doi:10.4314/ijbcs.v17i1.18. ISSN 1997-342X.
- ↑ "Iamgold's growing investment in Burkina Faso". The Globe and Mail. Archived from the original on 17 April 2012. Retrieved 5 February 2026.
- ↑ "Growth in Burkina Faso Gold Mining Fuels Human Trafficking". Voice of America. 30 April 2021. Retrieved 5 February 2026.
- ↑ "Burkina Faso to nationalise more industrial mines, PM says". Reuters. Archived from the original on 1 May 2025. Retrieved 5 February 2026.
- ↑ "Burkina Faso". Danube Travel. 5 December 2018. Retrieved 6 January 2019.
- ↑ "FAOSTAT". www.fao.org. Retrieved 10 January 2022.
- ↑ "List of Goods Produced by Child Labor or Forced Labor". Archived from the original on 2 October 2013. Retrieved 11 June 2015.
- ↑ "Burkina Faso". www.imf.org. Retrieved 24 April 2026.
- ↑ "What We Do". Archived from the original on 20 February 2009. Retrieved 11 June 2015.
- ↑ "Burkina Faso Economic Outlook". 27 March 2019.
- ↑ "Keeping children safe from working in gold mines". childrenbelieve.ca. Retrieved 16 November 2025.
- Public Domain This article incorporates public domain material from the CIA World Factbook website https://www.cia.gov/the-world-factbook/.
External links
- West African Agricultural Market Observer/Observatoire du Marché Agricole (RESIMAO), a project of the West-African Market Information Network (WAMIS-NET), provides live market and commodity prices from fifty seven regional and local public agricultural markets across Benin, Burkina Faso, Côte d'Ivoire, Guinea, Niger, Mali, Senegal, Togo, and Nigeria. Sixty commodities are tracked weekly. The project is run by the Benin Ministry of Agriculture, and a number of European, African, and United Nations agencies.
- Burkina Faso latest trade data on ITC Trade Map