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The Economy of Togo

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The Economy of Togo The Economy of Togo U Tun Wai, Edwin L. Bornemann, Michel M. Martin, and Pierre E. Berthe * HE REPUBLIC OF TOGO is located on the Gulf of Guinea and T is bounded by Ghana on the west, by Upper Volta on the north, and by Dahomey on the east. The country covers 22,000 square miles; it measures almost 400 miles from north to south and 31 miles from east to west along the coast. A chain of low mountains forms a watershed for the Volta River basin to the west and the Mono River basin to the east. There are four geographical regions: the sandy coastal plains and the Ouatchi plateau stretching for 40 miles inland, the fertile Mono tableland, the Togo-Atakora mountains, and the sandstone Oti plateau in the north (see maps, pages 410 and 411). The population in January 1964 was estimated at 1,586,000, giving an average density of 70 persons per square mile, which is relatively high for West Africa. However, population density varies from 225 persons per square mile in the coastal zone and in the Kabre country of the northeast to 25 persons per square-mile in the Sokode area, and certain areas are virtually uninhabited. Population growth has been estimated at some 2.6 per cent per annum. Lome, the capital and main commercial center, with a population of some 97,000, is practically the only town of significant size. There are about 1,700 foreigners, of whom 1,200 are French nationals. Togo has 18 important ethnic groups and a large number of sub- groups. The Ewe tribe of the coastal region, although a minority, forms the most important social group. There are some 200,000 Christians and about 36,000 Moslems (mostly in the north) in Togo. The rest of the people are animists or fetishists. * U Tun Wai, Advisor in the African Department, was educated at the University of Rangoon, the University of Bombay, and the Yale Graduate School. Formerly lecturer in economics at the University of Rangoon and economist in the secre- tariat of the Economic Commission for Asia and the Far East, he is the author of Burma's Currency and Credit, Economic Development of Burma, and articles in economic journals. Mr. Bornemann, Assistant Chief of the West African Division, received his graduate training at the Universities of Hamburg and Gottingen. Formerly, he was on the staff of the Federal Ministry of Economic Affairs at Bonn. Mr. Martin, economist in the West African Division, received his graduate training at the University of Bordeaux. Formerly, he was on the staff of the Bank of France. Mr. Berthe, economist in the West African Division, received his graduate educa- tion at Brussels University and Columbia University. 409 ©International Monetary Fund. Not for Redistribution 410 INTERNATIONAL MONETARY FUND STAFF PAPERS ©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 411 ©International Monetary Fund. Not for Redistribution 412 INTERNATIONAL MONETARY FUND STAFF PAPERS About four fifths of the population are farmers and live in small villages. A large artisan class exists in both the urban and rural areas, and there is also a fairly well organized entrepreneurial class with women traders playing an active role in local commerce. Considerable progress has been made in education since the end of World War II. Approximately 35 per cent of school-age children (126,000 pupils) were in primary schools in 1963, compared with 5-10 per cent in 1948. In 1963 there were some 7,900 students in secondary and technical schools, and approximately 400 university stu- dents were studying abroad, mainly in France. GROSS DOMESTIC PRODUCT For 1958, gross domestic product was estimated at CFAF 25 billion ($100 million). For 1962, the gross domestic product (also at current prices) was estimated by the Planning Bureau at CFAF 32.8 billion, of which CFAF 11.8 billion represented self-consumed local production and CFAF 2.6 billion salaries paid by the Government. The apparent increase between 1958 and 1962 seems to have been due largely to differences in the methods of estimation. Reportedly, the coverage for 1962 was much better than that for 1958, and therefore it is difficult to draw any conclusions from the two figures. The 1962 estimate is equivalent to an annual per capita income of $80. Agriculture contributes approximately 55-60 per cent of total output, transport and commerce 15 per cent, services and Government 15 per cent, and industry and handicrafts the remainder. The economy of Togo has expanded in recent years, especially in the subsistence agriculture sector. Production and exports of cocoa and coffee have also increased since 1958, while exports of phosphates have expanded rapidly since exploitation of the mines began in 1961. In the late 1950's, capital formation was estimated at about 5 per cent of gross domestic product. For 1962, gross investments were estimated at CFAF 3,020 million, of which CFAF 1,000 million was in the private sector, CFAF 1,560 million in the public sector, and CFAF 460 million in the household sector. Thus, capital formation in 1962 was about 9 per cent of gross domestic product, but it is difficult to assess the significance of this percentage as methods of estimation have improved between 1958 and 1962. AGRICULTURAL PRODUCTION Agricultural production is very important in Togo, as it provides employment for more than 80 per cent of the working population, and as agricultural products account for about 70 per cent of total exports. ©International Monetary Fund. Not for Redistribution THE ECONOMY OF TOGO 413 Agricultural production is limited by the scarcity of good soils, a lack of water, and primitive cultivation methods. Yields are consequently low and there is a danger of soil exhaustion. The intensiveness of cultivation varies from region to region: the coastal zone, the Kabre region, and the Dapango area, close to Upper Volta, are the most cultivated areas. Generally speaking, many crops are cultivated concurrently on small family farms and there is no specialization. While Togo still has a reserve of cultivable land and manpower, this reserve is not located in regions suitable for cocoa and coffee cultivation. The available land could be used for subsistence crops (such as rice and groundnuts) and also for cotton. Food crops for domestic consumption Food crops are grown mainly for local consumption and only to a lesser extent for sale to neighboring countries (see Table 26, p. 462). The major food crops are yams, manioc, corn, millet, and sorghum, which account for over 80 per cent of total output. Export crops, such as coffee and cocoa, account for less than 20 per cent of output. Production of the main subsistence crops, especially manioc and yams, has expanded rapidly over the last decade (Table 1). Manioc, yams, and corn are the main food crops of the south (Ouatchi plateau), while millet and sorghum are grown mainly in the north, together with yams and voandzou nuts. Rice is grown both in the south and in the north. Various projects are under preparation for increasing subsis- TABLE 1. TOGO: PRODUCTION OF PRINCIPAL SUBSISTENCE CROPS, 1950, 1954, AND 1957-63 (In thousands of tons} 1950 1954 1957 1958 1959 1960 1961 1962 1963 Manioc 230 361 515 381 596 564 667 987 1,088 Yams 259 390 407 263 610 800 473 857 1,400 Corn 42 52 73 56 82 81 70 84 66 Millet and sorghum 84 116 98 67 89 99 50 74 119 Rice 7 9 11 11 14 11 9 18 23 Beans 5 7 8 10 9 6 13 14 Voandzou nuts 9 9 8 7 7 6 7 9 Sources: Service de I'lnformation du Gouvernement du Togo, Annuaire du Togo, 1962; Service de la Statistique Generate, Inventaire Economique du Togo, 1962-63; French Government annual reports on Togo to the United Nations; U.S. Depart- ment of Commerce, World Trade Information Service, Basic Data on the Economy of the Republic of Togo (Part 1, No. 61-25); and data supplied by the Togolese authorities. ©International Monetary Fund. Not for Redistribution 414 INTERNATIONAL MONETARY FUND STAFF PAPERS tence production so as to lessen the need for imported food products. The projects include intensification of rice cultivation, expansion of manioc, soya beans, vegetables, and fruit production, and general im- provement in the productivity of traditional cultivation. Export crops The production of export crops has fluctuated over the years and, with the exception of coffee, has not expanded recently. Cocoa and coffee account for approximately half of the total value of exports in recent years. Other export crops are cotton, groundnuts, coconuts, and palm products (Table 2). The cultivation of coffee was introduced into Togo after World War I, but production increased significantly only after World War II; it is grown in the mountains and in parts of the Mono tableland. The coffee is predominantly of the robusta type, but small quantities of arabica are also grown. Production was negligible in 1923, but it had increased to 9,000 tons by 1961/62 and to 11,000 tons in the following year. Production reached a record level of 18,000 tons in 1963/64. The recent rapid increase is due in part to the Government's program of introducing better varieties of coffee, teaching better cultiva- tion techniques, and encouraging greater use of fertilizers. Coffee exports have fluctuated more or less with changes in produc- tion. Exports decreased from 11,600 tons in 1959 to 4,400 tons in 1960, but they recovered to 10,200 tons in 1961 and 11,500 tons in 1962, and declined again, to 6,200 tons, in 1963.
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