Resource information
The main conclusion of Country Economic
Memorandum is that the previous model of extensive growth
has now exhausted its potential and must be renewed. Given
the existing population dynamics, low environmental
tolerance due to its Sahelian climate and competition forces
imposed due to its open economy, Burkina Faso is heavily
investing in growth based on increased productivity to
overcome its low level of initial human capital, capacity
constraints and regulation. To help define the new model of
development of Burkina Faso, the Country Economic Memorandum
is exploring growth based on productivity both at macro-,
meso-economic or sectoral, micro and institutional levels
only. It also assesses the sustainability of growth in the
human, demographic, financial, fiscal and physical
infrastructure. Wherever possible, it evaluates the
performance of previous development programs and provides
diagnostics on problems. It analyzes the current situation
in terms of challenges and opportunities. Several major
constraints on growth have been identified and the
Memorandum offers practical ways to reduce or mitigate them.
These constraints are: i. The frequency of exogenous shocks
on agriculture in Burkina Faso, especially cotton,
significantly slows the socio-economic development; ii. The
real appreciation of the exchange rate has eroded the price
competitiveness; iii. The country's attractiveness to
foreign direct investment, despite significant progress in
the business environment, limited growth potential; iv. The
high fertility rates impede growth per capita and social
development beginning with human capital; v. Environmental
constraints limit the extensive growth of agriculture, while
food security is always a challenge for human development;
vi. The vulnerability of poor households prevents them from
truly engaging in productive economic activities; vii.
Constraints on institutional and human capacities reduce the
effectiveness of public policies. The first volume of the
Memorandum emphasizes the need for Burkina Faso to consider
the macroeconomic and microeconomic constraints to growth
and competitiveness, draws attention to the low
sophistication of its exports and suggests policy
instruments to facilitate the promotion of export and
investment led by the private sector. The second volume
emphasizes (i) the need for appropriate choices to ensure
the viability of the cotton sector, (ii) the development of
supply chains to achieve food security, growth and import
substitution, (iii) the important role in the mining sector
for growth, with good revenue management, and finally (iv)
the potential of tourism as an industry will depend on the
service quality improvements and the accommodation capacity
and infrastructure. The third volume identifies the actions
necessary to (i) address the issues of demographic change
through better information, education and communication
campaigns to bring about behavioral changes, (ii) develop
instruments of risk management to manage the risks of
economic, social, health, natural and food security, (iii)
improve the country's access to regional and
international markets, better connections to regional
transport infrastructure, electricity, and
telecommunications, water services and improved irrigation
systems, (iv) exploiting the financial intermediation by new
mechanisms of access to credit, reform the financial sector
and institutional capacity building in financial management
and risk in the business sector, and (v) create and use the
budget by prioritizing expenditures, ensuring the collection
of revenue and increasing the flow of aid.
