| Poverty profile The poverty assessment used data from the 1986-87 household budget survey to calculate an absolute poverty line of CFAF 39,286 (equivalent to US$131), below which 15 percent of the population falls. With the January 1994 devaluation, a new poverty line should be estimated, but the instability of post-devaluation prices makes such an estimate impossible. On the basis of a qualitative analysis of vulnerability (referring to defenselessness, insecurity, and exposure to risk), the prevalence of relative (as opposed to extreme) poverty is estimated at about 30 percent. Vulnerable groups include the following: female-headed households, abandoned old people, children in difficult circumstances (including street children and those "placed" in families as servants), fishermen's families, farm households with inadequate resources (such as share-croppers), refugees, retrenched civil servants, and unemployed graduates. Although only 15 percent of the population can be considered to be extremely poor, nutritional and social indicators suggest a less optimistic picture. Wasting is high among younger children (30 percent) and continues to be a problem for older children (about 20 percent). While Benin produces enough food to be self-sufficient, there are pockets of food insecurity throughout the country, as well as recurrent seasonal shortages. Seasonal hunger tends to coincide with patterns of disease, and high fertility rates (the total fertility rate is 7.1) compound the problem. Educational indicators are particularly low for primary school, with marked regional and gender differences. Distance from school, school fees, the need for child labor, and limited employment opportunities for school leavers keep enrollment rates down, while cultural variables represent an extra obstacle to girls' education. Population pressure is closely associated with both environmental degradation and poverty. Although the north is sparsely populated (12-15 persons per km2), the environment does not allow for intensive agriculture. In the south, with a population density of 150 persons per km2, cultivable land per person is relatively scarce, and 11.5 percent of households have insufficient access to land to feed themselves.
Incentive and regulatory framework Between 1985 and 1988, per capita GDP declined on average by 5.6 percent per year, and the budget deficit remained close to 11 percent of GDP under the burden of a tripling of the wage bill and rising debt service payments. The government embarked on a structural adjustment process in 1989 when the situation reached an all-time low. Adjustment measures have had a positive impact on growth, which, although modest, set the country on a new course after years of economic decline. Real GDP grew by, on average, 4.2 percent in 1990-92 (although estimates for 1993 show growth to have slowed down to 3.3 percent), the primary surplus has been positive since 1991, and inflation has been low (2.3 percent). Agriculture accounts for about 40 percent of GDP (1990-92), and provides 70 percent of domestic exports as well as 75 percent of all employment. Cotton (Benin's principal export) has experienced spectacular growth thanks to government support (access to inputs, credit, extension, and marketing services). As a result, the standard of living of cotton producers has improved dramatically. However, the area under cotton cultivation has expanded to the point that production has now reached the limit of ginning capacity (200,000 tons/year), and the government has now adopted measures to contain expansion. Food production has been growing over the past 30 years, primarily because the area under cultivation has been extended. Most agricultural methods remain traditional, and yields remain unstable and low. Unclear land tenure rights, weak extension services, lack of credit, and very limited access to inputs contribute to low productivity. In addition, the steady decline of food crop prices over the past 20 years and high marketing margins (in part explained by the poor state of rural infrastructure) have acted as disincentives to increasing output. The tertiary sector accounts for about 50 percent of GDP (1990-92) with an average annual growth of 3.5 percent and 30 percent of employment. At the heart of the tertiary sector are informal activities, notably microenterprises and cross-border trade. The pervasive network of restrictive regulations, heavy taxation, and price controls that was in effect during the 1970s and 1980s played a decisive role in the development of the informal sector. Under structural adjustment, the government has taken significant steps to create an environment more conducive to formal private sector activity, but more remains to be done.
Public expenditures The performance of the social sectors in Benin is lower than what could be expected on the basis of its economic indicators, even though the share of expenditures devoted to these sectors is higher than in most of Sub-Saharan Africa. Between 1988 and 1991, the government allocated, on average, about one third of its recurrent budget to social services, with 80 percent of it going to education. However, almost all of the social sector allocation is spent on salaries, leaving very little for maintenance, equipment, and other essential expenditures. Human resources have been mismanaged, as evidenced by the number of doctors and teachers holding administrative positions in main urban centers in spite of a shortage in rural areas. Social affairs and rural infrastructure routinely receive the lowest allocations. The problem, therefore, appears to be not so much one of inadequate budgetary allocations but of inefficient use of resources. Making education more accessible to the poor means concentrating resources on the services the poor are most likely to need: primary schooling and functional literacy skills. Although the share of the education budget going to primary schools has risen from 43 percent in the mid 1980s to 58 percent in 1988 and is expected to rise further, persistent low enrollment rates and high dropout and repeat rates indicate that this measure alone is not enough. The 1992-94 plan of the Ministry of Health is articulated three main objectives: increasing health coverage nationwide, ensuring the viability of the health system, and improving people's health conditions. These objectives imply a marked departure from some of the previous policies, as the total health budget in 1991 was 32 percent lower than in 1987, while the share of the budget going to salaries was 30 percent higher. While the outreach programs for preventive care and health education as well as a number of health centers in remote locations are almost completely funded by donors, the health care system remains quite centralized and usually beyond the reach of the poor. Existing government health services are significantly under-utilized because of their distance, their cost, and the quality of the services provided. Only 54 percent of the Beninese population, largely urban dwellers, have access to potable water.
Safety nets The most important safety nets available to poor people are the extended family, the community, and various local associations (including tontines). However, their effectiveness should not be overestimated since it is limited to the means available to their members. The very poor are not in a position to provide much assistance to each other. Within the civil service, responsibility for giving assistance to the most vulnerable falls mainly on the Ministry of Labor, Employment, and Social Affairs, and, in particular, on the Social Affairs Department. Its mandate is essentially to improve the living conditions of the poor. It includes long-term assistance to the handicapped, lepers, orphans, and malnourished children, as well as emergency aid to families in dire straits, such as fire victims. Unfortunately, resources are way below the level required to carry out such an ambitious program: only 2 percent of the public funds allocated to the social sectors during 1988-91 went to Social Affairs, and they were almost completely spent on salaries, while the allocation for emergency assistance has never materialized since 1988.
Poverty strategy While the poverty assessment does not pretend to present a comprehensive and detailed poverty alleviation strategy, it does present a set of priority areas of intervention: - Agriculture: Interventions that accelerate the growth of the agricultural sector are likely to be particularly beneficial to the poor. These should aim: (i) to slow down environmental degradation; (ii) to increase returns to labor; and (iii) to create employment opportunities. Interventions to stimulate equitable agricultural growth must address the key constraints faced by poor farmers, in other words, lack of information, limited marketing opportunities, and insufficient access to inputs.
- The tertiary sector and employment creation: The tertiary sector appears to be the most promising in terms of securing jobs and income-earning opportunities for the poor. A simplification of the tariff system and of the regulations governing formal businesses is already planned and should be implemented in the near future. The poor, however, tend to find employment in the informal sector, so assistance to microenterprises is also needed. In the short run, the approach should aim to build on existing mechanisms by collaborating with NGOs, which have a track record of successful microenterprise assistance. In the longer run, training programs in business and marketing skills should be designed. Such assistance should be coupled with labor-intensive public works.
- Education: The three most important goals to pursue are: (i) improving the educational attainment of females; (ii) increasing primary school enrollment rates (especially in rural areas and in the north); and (iii) lowering repetition rates. Increasing the effectiveness of the Ministry is only part of the answer. It is also necessary to address the cultural and economic factors that act as disincentives in parents' decisions about whether or not to send their children to school.
- Family planning: It is imperative that the government take immediate and strong action to decrease the population growth rate. The first step should be the formulation of an official family planning policy. This should be accompanied by the creation of a Family Planning Directorate in the Ministry of Health, with appropriate budget reallocations. Pilot interventions to address unmet demands in urban centers and in overcrowded rural areas should get underway as soon as possible, along with a persuasive information and education campaign.
- Targeted interventions: At present, there is no institutional set-up capable of responding quickly and effectively to grassroots' requests for assistance. Thus, a social fund should be established to provide funding and limited technical assistance to implement small-scale projects conceived by poor communities or groups of disadvantaged people within communities.
Statistical system Compared to most Sub-Saharan African countries, the poverty-related information available in Benin from official sources appears to be superior. A closer look, however, reveals three main gaps: (i) a lack of information on household consumption levels and intra-household allocations (essential for calculating a poverty line); (ii) a lack of reliable malnutrition data at the national level; and (iii) a lack of information on the coping mechanisms of the poor. These gaps represent a serious impediment to monitoring poverty and the success of efforts to alleviate it, as well as to designing effective interventions.
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