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Public debt in Benin: the rate should fall gradually over the period 2025-2027

26/08/2024
Source : ORISHAS-FINANCE
Categories: Rate

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The Multiannual Fiscal and Economic Programming Document 2025-2027 mentioned that Benin will continue efforts to ensure the overall sustainability of public debt and minimize portfolio risks through regular monitoring of the evolution of indicators.

Through the Multiannual Budgetary and Economic Programming Document (Dpbep) 2025-2027 adopted on 12 June by the Council of Ministers, the Beninese government is aiming for the period under review, a proactive debt management policy for the period under review, in order to keeping debt sustainable. Thus, the debt ratio should gradually fall over the period, from 54.2% of gross domestic product (GDP) in 2023 to 53.6% in 2025 and then to 52.3% of GDP in 2027, according to projections by the Caisse Autonome de Gestion de la Debt (Cagd,

April 2024).

To this end, the State will give priority to its choice of concessional financing, while diversifying its sources of financing and ensuring the quality of its portfolio, indicates the document published by the Ministry of Economy and Finance. Traditional partners, those with lower costs and a long maturity, in managing the risk of refinancing and the cost of the public debt portfolio will be preferred. The current Debt Strategy (2020-2024) predicts that debt maturing in one year will remain below 10%. According to the 2025-2027 Dpbep, the government intends to solicit international commercial banks and ensure the conditions of the international bond market in order to position itself as soon as possible and to capture the most attractive resources. Benin intends to pursue its strategy of regularly evaluating its financial rating by the various rating agencies as well as reforms to transform the economy structurally and manage public finances properly.

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