Washington, USA, 10 November 2026 -/African Media Agency (AMA)/ – The World Bank has published the 4th edition of its annual Benin Economic Update, titled “Accelerating Benin’s Structural Transformation for More and Better Jobs: The Role of the Electricity Sector.” The report shows that Benin’s economy remains one of the most dynamic in the region. Growth is not yet generating enough formal, well-paid jobs. However, the report says that reforms in the electricity sector and the success of the Mission 300 Compact could make energy a major catalyst for job creation in the country.
Benin’s economy rests on a solid macroeconomic base. Growth reached 8.1% in 2025 and averaged 7.1% between 2021 and 2025, one of the strongest in the region. The fiscal deficit was brought down to 2.7% of GDP in 2025, below the West African Economic and Monetary Union (WAEMU)ceiling of 3%, and inflation remained low at 1.1%.
Despite this progress, growth is not yet creating enough formal and better-paid jobs. In 2022, 96.3% of workers were employed in the informal sector, and eight out of ten jobs created were self-employment. In 2024, fewer than one in five workers (19.8%) held a wage job, and the share was even lower among young people (9%). Many workers are also turning to low-productivity service activities, which offer little scope for income growth.
The good health of Benin’s economy is a solid foundation. The challenge now is to maintain strong economic fundamentals and ensure that this growth is supported by productivity gains and creates more and better-paid jobs, especially for young people
Mamadou Tanou Baldé,
World Bank Economist and lead author of the report
There are encouraging signs. The number of jobs in the Glo-Djigbé Industrial Zone reached 22,798 in 2025, up 28.8% year on year. This shows that formal industrial jobs can be created at scale.
The report also stresses the key role of electricity in business development. Nearly one in two Beninese firms considers access to electricity a major obstacle, and 86.1% of firms experience outages. Despite progress in recent years, challenges remain, relating to both infrastructure and governance. Grid losses reached 24.7% in 2024, and about half of the transmission lines and substations are more than 25 years old. Gas shortages also force a costly reliance on heavy fuel oil.
Implementing the Mission 300 Compact could generate nearly 159,000 additional and better-quality jobs. To get there, we need to diversify energy sources, modernize grids, improve sector governance, reduce supply costs, and make it easier for households and businesses to connect. The World Bank remains fully committed to working alongside the Government to mobilize the public and private financing needed and to support the implementation of these reforms
Karine Bachongy,
World Bank Group Country Manager in Benin
The outlook remains positive. Growth is expected to remain robust over the medium term, at 7.6% in 2027-2028. Several risks could nonetheless slow this momentum, including the conflict in the Middle East, rising energy prices, the effects of climate change, and security challenges. On the other hand, regional integration, with closer economic trade with Nigeria, could generate up to $1.3 billion a year and create 26,000 direct jobs, notably in grain processing, textiles, energy, higher education, and tourism.
Download the Benin Economic Update in French.
Distributed by African Media Agency (AMA) on behalf of World Bank Group
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