The international financial rating agency S&P has maintained its B+ rating for the Republic of Benin, and favorably revised the associated outlook from Stable to Positive. This remarkable decision, in the current context of growing international instability, makes Benin the only African country with a Positive outlook from S&P. Through this decision, the agency salutes the continued resilience shown by Benin in recent years, the country’s very favorable growth prospects, and an anticipated acceleration of fiscal consolidation from 2023.S&P recalls the strong economic dynamism recorded by Benin since 2017 despite successive external shocks, with growth continually exceeding that of countries with equivalent ratings. The agency anticipates growth of nearly 6% in 2023, accelerating to an average of nearly 6.5% over 2024-2026. These projections are underpinned by the sound economic policies pursued by the authorities and the effective implementation of the Government’s Action Program. In particular, S&P highlights the rapid development of the Glo Djigbé special economic zone, which is contributing to the structural transformation of the Beninese economy and the development of high value-added sectors. S&P also expects Benin’s fiscal performance to improve in the short term, driven by continued growth in budget revenues and a strategy of targeted spending in the most strategic sectors. From 2023, S&P forecasts an acceleration in the reduction of the budget deficit, which should fall back below the EU standard of 3% by 2025. Finally, the agency once again praises the quality of Benin’s financing strategy, and the authorities’ proactive debt management. The favorable structure of Benin’s public debt, the support of international donors, and the ability to mobilize innovative financing effectively limit the repercussions of the global rise in interest rates on Benin.
October 20, 2023