Governance: Togo Requests IMF Audit

Economic governance

Monday, 06 January 2025 15:42

(Togo First) - The Togolese government has asked the International Monetary Fund (IMF) to review its governance. This “governance diagnostic” aims to find weaknesses in public institutions and improve transparency, which is important for attracting private investment as Lomé works to boost its economy.

“A diagnostic assessment of governance by the IMF would be highly beneficial, as it would provide a fresh, independent perspective and pave the way for the development of targeted solutions,” the IMF teams suggested a few months ago.

This request shows Togo's commitment to modernizing its institutions. “The IMF's diagnosis will be a tool for fine-tuning our policies and improving the efficiency of our institutions,” said a source close to the Ministry of Finance.

The IMF welcomed the request, viewing it as a sign of Togo's dedication to better governance. The review could help close legal gaps, strengthen efforts against corruption, and improve how public resources are managed. The Fund also recommended that the results be made public to increase confidence among international investors.

Togo is counting on economic recovery through structural reforms. The IMF predicts real economic growth of 5.6% in 2023, with expectations of 5.3% in 2024-2025 and around 5.5% each year after that. The PIA Special Economic Zone, an important part of Togo's industrial plans, is showing positive results according to the IMF. However, careful management of tax incentives is needed to avoid budget problems.

Togolese authorities plan to streamline these incentives by ending one-time benefits and focusing on existing special tax regimes. “They intend, however, to put an end to ad hoc tax incentives in addition to those granted under the three special tax regimes,” according to the conclusions from the first review of the 42-month program supported by the Extended Credit Facility (ECF).

Fiacre E. Kakpo

REFORMS OVERVIEW

STARTING A BUSINESS (more info)

At the fifteenth position, worldwide, and first in Africa, under the Starting a Business index of the 2020 Doing Business ranking, Togo sustains its reformative dynamics with more reforms….

ENFORCING CONTRACTS (more info)

Compared to some years ago when it was one of the lowest rankers under the Doing Business’ Enforcing Contracts indicator, Togo, leveraging many efforts to improve its business climate, was able to jump significantly on the index in the recent years... .

CONTRACT EXECUTION (more info)

Creation of special chambers of commerce for small debts • Creation of chambers of commerce at the Court of Appeal • Civil and commercial cases now handled by distinct clerks • Establishment of commercial courts in Lomé and Kara • Lawyers and bailiffs now have access to the FORSETI COMMERCIAL platform • A maximum period of 100 days was fixed to settle a commercial dispute .

TRADING ACROSS BORDERS (more info)

In comparison to previous years,Togo has significantly improved its ranking under the“Trading across borders” indicator by adopting multiple reforms that focus mainly on the digitization and reduction in delays, for import and export procedures related to import and export.

In comparison to previous years, Togo has significantly improved its ranking on the “Trading across borders” index by adopting multiple reforms that focus mainly on the digitalization and reduction in delays, for import and export procedures related to import and export.

CONSTRUCTION PERMIT (more info)

After moving from the 133rd to 127th place under the 2020 Doing Business’ construction permit index, Togo intends to reiterate this feat in the coming edition of the global ranking. To this end, it has introduced this year multiple reforms.

GETTING ELECTRICITY (more info)

Over the past two years, Togo’s ranking under the Doing Business’ Getting electricity and water indicator has increased consistently. Owing this performance to multiple reforms aimed at making it easier for businesses to access power and water, Lomé plans to introduce even more reforms this year to keep up its improvements.

REGISTERING A PROPERTY (more info)

Out of all the 'Doing Business’ indicators, Property Registration is where Togo has improved the most since 2018. Indeed, after spending years in the lowest part of this ranking, the country now seeks to beat Rwanda which is the best performer on this index in Africa. To do so, Lomé has been introducing many reforms, with the latest batch implemented this year.

PUBLIC PROCUREMENT (more info)

From professionalization to digitization, through legislative regulations, Togo’s public procurement framework is constantly being modernized. Several reforms have been implemented to improve the sector much to the benefit of the private sector, which is the focus of the National Development Plan.

PAYING TAXES AND DUTIES (more info)

To improve its business environment, Togo introduced some important reforms related to the payment of tax and duties. From the replacement of some taxes to the cancellation of others through exemptions, the country has only one objective: offer the most attractive tax framework to investors and economic operators. To achieve this, the authorities relied on digitization.