This report provides a detailed analysis of Benin's cotton industry in 2023, considering the complex macroeconomic conditions. Despite social disparities and poverty, Benin's GDP growth rebounded significantly thanks to robust trade ties, particularly with Nigeria. The primary industries in Benin include cotton, the Port of Cotonou, telecommunications, and various cash crops. The cotton industry is a critical player in the country’s economy and is affected by multiple structural factors such as political, economic, social, technological, legal, and environmental aspects. In the face of fluctuating macroeconomic conditions, Benin's ability to strengthen its cotton industry will depend on its ability to navigate rising worldwide interest rates, increasing borrowing costs, high inflation, and high public debt. The hostile economic environment, reduced aid budgets, and decreased Chinese financing raise concerns about debt sustainability and economic growth. Amidst the difficulties the cotton industry faces due to unfavourable macroeconomic conditions and climate change, the report highlights the significance of effective public policies. It stresses the importance of allocating public funds to address the weaknesses and opportunities present in the sector. However, the rising costs of adaptation and mitigation pose a challenge in balancing the needs of the industry and combating climate change. The report suggests solutions such as obtaining more concessional finance, encouraging private climate finance, and utilising concessional finance to boost personal finance.
