Burkina Faso - Economy

Economy

Burkina Faso has one of the lowest GDP per capita figures in the world: $1,200. Agriculture represents 32% of its gross domestic product and occupies 80% of the working population. It consists mostly of livestock but also, especially in the south and southwest, of growing sorghum, pearl millet, maize (corn), peanuts, rice and cotton. A large part of the economic activity of the country is funded by international aid.

Burkina Faso was ranked the 111th safest investment destination in the world in the March 2011 Euromoney Country Risk rankings.

Remittances used to be an important source of income to Burkina Faso until the 1990s, when unrest in Côte d'Ivoire, the main destination for Burkinabe emigrants, forced many to return home. Remittances now account for less than 1% of GDP.

Burkina Faso is part of the West African Monetary and Economic Union (UMEOA) and has thus adopted the CFA Franc, which is issued by the Central Bank of the West African States (BCEAO), situated in Dakar, Senegal. The BCEAO is not only responsible for the monetary and reserve policy of the member states, but also for the regulation and oversight of financial sector and banking activity. A legal framework regarding licensing, bank activities, organizational and capital requirements, inspections and sanctions (all applicable to all countries of the Union) is in place and underwent significant reforms in 1999. Micro-finance institutions are governed by a separate law, which regulates micro-finance activities in all WAEMU countries. The insurance sector is regulated through the Inter-African Conference on Insurance Markets (CIMA).

There is mining of copper, iron, manganese, gold, cassiterite (tin ore), and phosphates. These operations provide employment, international aid, and in some cases hospitals at mines for the public. Gold production increased 32% in 2011 at six gold mine sites, making Burkina Faso the fourth largest gold producer in Africa, after South Africa, Mali and Ghana.

Burkina Faso also hosts the International Art and Craft Fair, Ouagadougou, better known by its French name as SIAO, Le Salon International de l' Artisanat de Ouagadougou, one of the most important African handicraft fairs.

Burkina Faso is a member of the Organization for the Harmonization of Business Law in Africa (OHADA).

While services remain underdeveloped, one state-owned utility company run along commercial lines is emerging as one of the best performing utility companies in Africa, the National Office for Water and Sanitation (ONEA). High levels of autonomy and a skilled and dedicated management has driven ONEA's ability to improve production of and access to water. Since 2000, nearly 2 million more people have access to water in the four principal urban centres in the country while at the same time keeping the quality of infrastructure high (less than 18% of the water is lost through leaks – one of the lowest in sub-Saharan Africa), improving financial reporting and an average 12% annual revenue increase (well above inflation). Challenges remain, including some customers' ability to pay and a reliance on aid for the expansion of its infrastructure. However, the state-owned commercially run venture has helped lead Burkina Faso's Millennium Development Goal (MDG) targets in its water-related targets and grow as a viable company.