Togo has emerged as the top performer in public debt management within the West African Economic and Monetary Union (WAEMU) in the first half of 2025, recording the sharpest decline in its outstanding debt stock. According to recent data released by UMOA-Titres, the regional agency that oversees public securities in the WAEMU zone, Togo’s public debt stood at 1,959.50 billion CFA francs as of the end of June 2025. This marks a 2.90 percent drop compared to its position in December 2024.
The reduction sets Togo apart in the regional economic landscape. While Togo managed to reduce its debt burden, other WAEMU member states witnessed a rise in their public debt levels. Senegal, for instance, recorded a 5.71 percent increase, Benin’s debt rose by 2.28 percent, and Côte d’Ivoire’s debt moved up by 1.46 percent during the same period. Only Niger joined Togo in reducing its debt, though at a smaller rate of 0.93 percent.
Togo’s debt reduction is largely attributed to a combination of lower borrowing activities and a deliberate acceleration in debt repayments. Between January and June 2025, Togo raised only 318.76 billion CFA francs from the regional market—a significant 32 percent drop compared to the 468.75 billion CFA francs it raised in the same period last year. At the same time, it increased its repayments by 39 percent, settling 448.30 billion CFA francs compared to 322.55 billion CFA francs in the previous year.
This approach resulted in a net reduction of over 129 billion CFA francs and aligns with the government’s national debt management strategy, which seeks to improve the structure of the country’s debt portfolio. As of June, domestic debt accounted for 57.67 percent of Togo’s total debt stock, equivalent to about 39.89 percent of GDP. The Togolese authorities are working towards adjusting this balance to achieve a 55 percent external and 45 percent domestic debt ratio by the end of 2025.
The push for a more externally balanced portfolio is driven by the advantages of longer maturities and access to concessional or semi-concessional financing options from global partners such as the World Bank, the West African Development Bank (BOAD), and the African Development Bank (AfDB). These external sources often offer more favourable repayment terms compared to domestic markets.
However, one key challenge remains. Togo’s domestic debt portfolio is heavily skewed toward short-term instruments. Treasury Bills, known in the region as Bons Assimilables du Trésor (BAT), which mature in under one year, make up 89 percent of the country’s debt on the regional financial market. Longer-term Treasury Bonds, or Obligations Assimilables du Trésor (OAT), represent just 11 percent of the domestic portfolio. This heavy reliance on short-term debt instruments creates substantial refinancing risks, particularly in an environment of rising interest rates across the WAEMU region.
This vulnerability is further reflected in Togo’s yield curve. Interest rates on one-year Treasury Bills have reached as high as 8.04 percent, signalling investor demand for high returns on short-term instruments due to perceived risk. In contrast, yields fall to about 6 percent for five-to-ten-year bonds, showing a more tempered outlook among long-term investors and possibly greater confidence in the country’s medium- to long-term stability.
While the current decline in public debt is seen as a positive step towards better fiscal management and reduced borrowing pressure, experts warn that sustaining this trend may be difficult. With inflation and interest rates still high in the region, future borrowing could become more expensive. This may force the government to either tighten fiscal policies or revisit its debt issuance strategy in the second half of the year.
Observers also note that the government’s ability to reduce short-term reliance on Treasury Bills will be critical to ensuring more predictable debt servicing obligations. If successful, Togo could enhance its financial credibility and improve its attractiveness to both local and international investors.
As it stands, the government’s mid-year performance offers cautious optimism, showing that with clear policy direction and disciplined execution, small economies within the WAEMU zone can navigate fiscal pressures effectively while building a more sustainable debt framework.
