Worker in a cotton ginning plant in Ouagadougou

Economic situation Great dependency on gold and cotton

Before the outbreak of the COVID-19 pandemic, Burkina Faso was one of the countries on the African continent with the highest growth rates. In the years before the pandemic, growth rates had ranged from 5.7 to 6.7 per cent. In 2020, economic growth dropped to two per cent because of the pandemic. The International Monetary Fund (IMF) is predicting that, from 2021 onwards, the economy will recover and economic growth rates climb back to five per cent and more in the coming years.

The COVID-19 pandemic has clearly shown that Burkina Faso's economy is not able to cushion the impact of a crisis. The economy lacks diversification. The main export products are gold and cotton, with the effect that the country is highly dependent on world market prices, supply chains and climatic conditions.

A critical security situation, low educational levels and poor infrastructure are holding back the country's economic development. Then there is the unfavourable geographical position: Burkina Faso is landlocked, which means high transportation costs for export industries.

The situation is further exacerbated by high population growth. Although good farmland is scarce, the country needs to feed more and more mouths. Often, new farmland is not used in a sustainable manner, so that over the long term it becomes unsuitable for agriculture. Even now, it is estimated that about one third of country’s land surface is degraded, whilst at the same time Burkina Faso is not tapping existing potential for increased production to the full. For instance, farmers have no access to modern methods of agricultural production or to appropriate financial services. This is where German development cooperation comes into play (see also core area “Transformation of agri-food systems”).