Economy

The economy of Benin remains underdeveloped and dependent on subsistence agriculture, cotton production, and regional trade. Cotton accounts for 40% of GDP and roughly 80% of official export receipts. Growth in real output has averaged around 5% in the past seven years, but rapid population growth has offset much of this increase. Inflation has subsided over the past several years. Benin uses CFA franc, which is pegged to euro.

In order to raise growth still further, Benin plans to attract more foreign investment, place more emphasis on tourism, facilitate the development of new food processing systems and agricultural products, and encourage new information and communication technology. Projects to improve the business climate by reforms to the land tenure system, the commercial justice system, and the financial sector were included in Benin's US$307 million Millennium Challenge Account grant signed in February 2006