Benin report - Institut Africain de la Gouvernance

CHAPTER FOUR: ECONOMIC GOVERNANCE AND MANAGEMENT__________________________________________________________________________However, sound management became difficult because of the politicalinstability caused by 12 years of crisis in managing national independence.343. As a result of the importance of French capital in the economy and of limitedstate resources, economic governance during this period was never closed toprivate investment. Rather, the new state‟s economy – without beingeffectively transformed – was made to function alongside private initiatives,such as industries and businesses, to promote Benin‟s economy and theeconomies of landlocked neighbouring countries.344. This means that the challenge of transforming an economic structure modelledalong colonial lines into an integrated economic structure striving for nationaldevelopment, though possible, continued to pose problems. The postcolonialeconomic governance and management structures could not define, much lessimplement, an economic policy aimed at structural transformation. Benin‟sposition in the empire continued to be crucial in the economic governance ofthis period. This was understandable as the country, which was handling itspolitical instability with difficulty, did not have the time to define a vision forthe Benin (Dahomey at that time) that it wanted to construct for the future orto mobilise the human, material and financial resources required for thatpurpose.345. The second period, during which socialism was adopted, was marked, asexpected, by nationalising some private enterprises, by creating new stateenterprises and by creating some semipublic companies. Since socialistsystems advocate industrialisation, massive state industrial investments wereencouraged. However, the country lacked the capacity to manage them.346. Furthermore, it was difficult for a state, without any real economic weight andwith a neocolonial economy managed from the outside, to develop a socialistdevelopmental policy. It had neither the resources nor the capacities. Its newpolicies were attacked both from within and outside of the country.Consequently, the economic governance of the country continued, even duringthis second period, to manage, or rather mismanage, its colonial heritage. Theeconomic and social consequences were soon felt. The half measures ofsocialist governance and poor economic and financial management in acontext of economic crisis led to social and political unrest. This ultimatelydestroyed the option of a socialist developmental system towards the end ofthe 1980s.347. In fact, in the first half of the 1980s, a failed economic governance system hadalready affected the country. Aware of the fact that Benin had been hard hit byan economic crisis and drought, its leaders finally declared Benin a „disastercountry‟ at the beginning of 1984 and sought international aid. Themacroeconomic situation, the state of affairs in the core sectors of theeconomy, and the economic and social conditions of the population causedthings to worsen drastically. The state was unable to pay the meagre salaries ofits civil servants and poverty increased.131