The economy of Burkina Faso is based primarily on subsistence farming and livestock raising.
Burkina Faso
Burkina Faso (, ; , ff, 𞤄𞤵𞤪𞤳ðž¤ðž¤²ðž¤¢ 𞤊𞤢𞤧𞤮, italic=no) is a landlocked country in West Africa with an area of , bordered by Mali to the northwest, Niger to the northeast, Benin to the southeast, Togo and Ghana to ...
has an average income purchasing-power-parity per capita of $1,900 and nominal per capita of $790 in 2014. More than 80% of the population relies on
subsistence agriculture, with only a small fraction directly involved in
industry
Industry may refer to:
Economics
* Industry (economics), a generally categorized branch of economic activity
* Industry (manufacturing), a specific branch of economic activity, typically in factories with machinery
* The wider industrial sector ...
and
services
Service may refer to:
Activities
* Administrative service, a required part of the workload of university faculty
* Civil service, the body of employees of a government
* Community service, volunteer service for the benefit of a community or a p ...
. Highly variable rainfall, poor
soil
Soil, also commonly referred to as earth or dirt
Dirt is an unclean matter, especially when in contact with a person's clothes, skin, or possessions. In such cases, they are said to become dirty.
Common types of dirt include:
* Debri ...
s, 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
An export in international trade is a good produced in one country that is sold into another country or a service provided in one country for a national or resident of another country. The seller of such goods or the service provider is an ...
economy also remained subject to fluctuations in world prices.
The country has a high population density, few
natural resource
Natural resources are resources that are drawn from nature and used with few modifications. This includes the sources of valued characteristics such as commercial and industrial use, aesthetic value, scientific interest and cultural value. ...
s, and a fragile
soil
Soil, also commonly referred to as earth or dirt
Dirt is an unclean matter, especially when in contact with a person's clothes, skin, or possessions. In such cases, they are said to become dirty.
Common types of dirt include:
* Debri ...
. Industry remains dominated by unprofitable government-controlled corporations. 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
Macroeconomics (from the Greek prefix ''makro-'' meaning "large" + ''economics'') is a branch of economics dealing with performance, structure, behavior, and decision-making of an economy as a whole.
For example, using interest rates, taxes, and ...
progress depends on continued low inflation, reduction in the trade deficit, and reforms designed to encourage private investment.
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 institution
A non-banking financial institution (NBFI) or non-bank financial company (NBFC) is a financial institution that does not have a full banking license or is not supervised by a national or international banking regulatory agency. NBFC facilitate b ...
s 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.
Macro-economic trend
This is a chart of trend of gross domestic product of Burkina Faso at market price
estimatedby the International Monetary Fund with figures in millions of CFA Francs.
For purchasing power parity comparisons, the US Dollar is exchanged at 470.70 CFA Francs only. Mean wages were $0.56 per
man-hour
A man-hour (sometimes referred to as person-hour) is the amount of work performed by the average worker in one hour. It is used for estimation of the total amount of uninterrupted labor required to perform a task. For example, researching and wr ...
in 2009.
Current GDP per capita of Burkina Faso grew 13% in the Sixties reaching a peak growth of 237% in the Seventies. But this proved unsustainable and growth consequently scaled back to 23% in the Eighties. Finally, it shrank by 37% in the Nineties. 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
In geology and mineralogy, a mineral or mineral species is, broadly speaking, a solid chemical compound with a fairly well-defined chemical composition and a specific crystal structure that occurs naturally in pure form.John P. Rafferty, ed. (2 ...
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
Maize ( ; ''Zea mays'' subsp. ''mays'', from es, maÃz after tnq, mahiz), also known as corn (North American and Australian English), is a cereal grain first domesticated by indigenous peoples in southern Mexico about 10,000 years ago. The ...
, and
rice
Rice is the seed of the grass species '' Oryza sativa'' (Asian rice) or less commonly ''Oryza glaberrima'' (African rice). The name wild rice is usually used for species of the genera '' Zizania'' and '' Porteresia'', both wild and domesticat ...
. The cash crops are
cotton
Cotton is a soft, fluffy staple fiber that grows in a boll, or protective case, around the seeds of the cotton plants of the genus '' Gossypium'' in the mallow family Malvaceae. The fiber is almost pure cellulose, and can contain minor pe ...
,
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.
Agriculture
Burkina Faso produced in 2018:
* 1.9 million tons of
sorghum;
* 1.7 million tons of
maize
Maize ( ; ''Zea mays'' subsp. ''mays'', from es, maÃz after tnq, mahiz), also known as corn (North American and Australian English), is a cereal grain first domesticated by indigenous peoples in southern Mexico about 10,000 years ago. The ...
;
* 1.1 million tons of
millet;
* 630 thousand tons of
cowpea
The cowpea (''Vigna unguiculata'') is an annual herbaceous legume from the genus ''Vigna''. Its tolerance for sandy soil and low rainfall have made it an important crop in the semiarid regions across Africa and Asia. It requires very few inputs, ...
(3rd largest producer in the world, preceded only by Niger and Nigeria);
* 490 thousand tons of
sugar cane
Sugarcane or sugar cane is a species of (often hybrid) tall, perennial grass (in the genus '' Saccharum'', tribe Andropogoneae) that is used for sugar production. The plants are 2–6 m (6–20 ft) tall with stout, jointed, fibrous stalk ...
;
* 482 thousand tons of
cotton
Cotton is a soft, fluffy staple fiber that grows in a boll, or protective case, around the seeds of the cotton plants of the genus '' Gossypium'' in the mallow family Malvaceae. The fiber is almost pure cellulose, and can contain minor pe ...
;
* 329 thousand tons of
peanut
The peanut (''Arachis hypogaea''), also known as the groundnut, goober (US), pindar (US) or monkey nut (UK), is a legume crop grown mainly for its edible seeds. It is widely grown in the tropics and subtropics, important to both small and ...
;
* 253 thousand tons of
sesame seed
Sesame ( or ; ''Sesamum indicum'') is a flowering plant in the genus '' Sesamum'', also called benne. Numerous wild relatives occur in Africa and a smaller number in India. It is widely naturalized in tropical regions around the world and is cu ...
(8th largest producer in the world);
* 240 thousand tons of
vegetable
Vegetables are parts of plants that are consumed by humans or other animals as food. The original meaning is still commonly used and is applied to plants collectively to refer to all edible plant matter, including the flowers, fruits, stems, ...
;
* 160 thousand tons of
rice
Rice is the seed of the grass species '' Oryza sativa'' (Asian rice) or less commonly ''Oryza glaberrima'' (African rice). The name wild rice is usually used for species of the genera '' Zizania'' and '' Porteresia'', both wild and domesticat ...
;
* 103 thousand tons of
cashew nuts
The cashew tree (''Anacardium occidentale'') is a tropical evergreen tree native to South America in the genus '' Anacardium'' that produces the cashew seed and the cashew apple accessory fruit. The tree can grow as tall as , but the dwarf cul ...
(12th largest producer in the world);
In addition to smaller productions of other agricultural products.
External trade
Industry, still in an embryonic stage, is located primarily in
Bobo-Dioulasso
Bobo-Dioulasso is a city in Burkina Faso with a population of 904,920 (); it is the second-largest city in the country, after Ouagadougou, Burkina Faso's capital. The name means "home of the Bobo-Dioula".
The local Bobo-speaking population (r ...
,
Ouagadougou
Ouagadougou ( , , ) is the capital and largest city of Burkina Faso and the administrative, communications, cultural, and economic centre of the nation. It is also the country's largest city, with a population of 2,415,266 in 2019. The city's ...
,
Banfora
Banfora is a city in south western Burkina Faso, with a population of 117,452 (2019 census) making it the sixth most populous city in Burkina Faso. It is the capital of the Comoe province. The city lies south-west of Bobo-Dioulasso, on the Abid ...
, and
Koudougou
Koudougou is a city in Burkina Faso's Boulkiemdé Province. It is located west of Ouagadougou, the capital of Burkina Faso. With a population of 160,239 (2019) it is the third most populous city in Burkina Faso after Ouagadougou and Bobo Dio ...
. Manufacturing is limited to
food processing,
textile
Textile is an umbrella term that includes various fiber-based materials, including fibers, yarns, filaments, threads, different fabric types, etc. At first, the word "textiles" only referred to woven fabrics. However, weaving is not the ...
s, and other import substitution heavily protected by
tariffs
A tariff is a tax imposed by the government of a country or by a supranational union on imports or exports of goods. Besides being a source of revenue for the government, import duties can also be a form of regulation of foreign trade and po ...
. Some
factories
A factory, manufacturing plant or a production plant is an industrial facility, often a complex consisting of several buildings filled with machinery, where workers manufacture items or operate machines which process each item into another. T ...
are privately owned, and others are set to be privatized. Burkina Faso's exploitable natural resources are limited, although a
manganese
Manganese is a chemical element with the symbol Mn and atomic number 25. It is a hard, brittle, silvery metal, often found in minerals in combination with iron. Manganese is a transition metal with a multifaceted array of industrial alloy use ...
ore
Ore is natural rock or sediment that contains one or more valuable minerals, typically containing metals, that can be mined, treated and sold at a profit.Encyclopædia Britannica. "Ore". Encyclopædia Britannica Online. Retrieved 7 Apr ...
deposit is located in the remote northeast.
Gold
Gold is a chemical element with the symbol Au (from la, aurum) and atomic number 79. This makes it one of the higher atomic number elements that occur naturally. It is a bright, slightly orange-yellow, dense, soft, malleable, and ductile me ...
mining has increased greatly since the mid-1980s and, along with cotton, is a leading export moneyearner. 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
The United States Department of Labor (DOL) is one of the United States federal executive departments, executive departments of the federal government of the United States, U.S. federal government. It is responsible for the administration of fede ...
report.
See also
*
Agriculture in Burkina Faso
*
List of companies based in Burkina Faso
*
United Nations Economic Commission for Africa
The United Nations Economic Commission for Africa (UNECA or ECA; french: link=no, Commission économique pour l'Afrique, CEA) was established in 1958 by the United Nations Economic and Social Council to encourage economic cooperation among its ...
*
List of banks in Burkina Faso
References
*
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
{{DEFAULTSORT:Economy Of Burkina Faso
Burkina Faso
Burkina Faso (, ; , ff, 𞤄𞤵𞤪𞤳ðž¤ðž¤²ðž¤¢ 𞤊𞤢𞤧𞤮, italic=no) is a landlocked country in West Africa with an area of , bordered by Mali to the northwest, Niger to the northeast, Benin to the southeast, Togo and Ghana to ...
Burkina Faso
Burkina Faso (, ; , ff, 𞤄𞤵𞤪𞤳ðž¤ðž¤²ðž¤¢ 𞤊𞤢𞤧𞤮, italic=no) is a landlocked country in West Africa with an area of , bordered by Mali to the northwest, Niger to the northeast, Benin to the southeast, Togo and Ghana to ...