- Benin’s public debt stood at 51.5% of GDP in Q2 2025
- Strong transparency and no arrears keep investor confidence high
COTONOU, BENIN – Benin has emerged as a standout in West Africa’s debt management, with its public debt kept at sustainable levels while maintaining investor confidence through strict transparency and timely repayments.
According to the second-quarter 2025 debt bulletin published by the Autonomous Debt Management Fund (CAGD), total public debt reached 7,303.2 billion CFA francs, equal to 51.5% of projected GDP. The ratio is comfortably below the West African Economic and Monetary Union (WAEMU) threshold of 70%, even after a slight increase from the previous quarter.
External borrowing makes up the bulk of Benin’s portfolio, accounting for 5,565.8 billion CFA francs, or 76.2% of the total. Domestic debt stands at 1,737.4 billion CFA francs, equal to 12.3% of GDP.
Despite this reliance on foreign financing, most loans are at fixed rates and long maturities, which officials say secures Benin’s financial trajectory. The CAGD stressed that “the public debt portfolio is generally of good quality,” pointing to the absence of arrears on both government and state enterprise loans.
In the first half of 2025, Benin honoured 569.1 billion CFA francs in payments, with 393.9 billion allocated to principal and 175.2 billion to interest. “No payment arrears have been observed,” the CAGD said, underlining the government’s fiscal discipline.
The country’s exposure to currency fluctuations also remains limited, with the euro accounting for 58.2% of its debt, the CFA franc 23.8%, and the US dollar only 10.2%.
Market transactions and recognition
Benin has actively tapped international markets this year. In January 2025, it issued a $500 million Eurobond with a 16-year maturity and a 6.48% coupon. It also secured a €500 million loan from Deutsche Bank, partially guaranteed by the World Bank, carrying a 15-year term and 6% interest rate.
Rating agencies have welcomed this approach. In February 2025, Moody’s raised the outlook on Benin’s B1 rating from “stable” to “positive,” while Fitch affirmed its B+ rating with a stable outlook.
The CAGD said Benin now ranks “first out of 78 IDA countries in terms of public debt transparency,” a position that reassures investors and strengthens market access.
A comparison with previous years highlights the improvement. At the end of June 2024, debt stood at 6,756.9 billion CFA francs, or 52.1% of GDP. By June 2025, the nominal debt had risen by 546 billion CFA francs due to new market operations, but the debt-to-GDP ratio fell to 51.5% thanks to strong economic growth.
Investors reassured
Economists argue this balance demonstrates Benin’s credibility as a borrower. “This international recognition reinforces the CAGD’s analysis that Benin’s public debt remains sustainable, despite increased recourse to international markets,” said Ramanou Yessoufou, Professor of Economics at the University of Abomey-Calavi.
“For investors, these data are clear. Benin borrows regularly, but does so with prudence and transparency. The new financing is used to refinance older, more expensive debts or to finance structural projects, while ensuring that debt servicing remains sustainable,” he said.
“In short, Benin’s public debt, estimated at 7,303.2 billion in the second quarter of 2025, appears not only manageable but also of good quality. For the markets, this means that Benin remains a reliable entity, capable of attracting financing on competitive terms while respecting its commitments,” Yessoufou added.
