Thursday, March 22, 2012

Passport Series: Benin, a country in transition

This is the first of a three part series taking a closer look at Benin, its history with microfinance, Kiva's role in expanding opportunities for Beninese households, and what it's like to participate in the country's economy as a borrower, lender and field worker. We hope you enjoy.

Sandwiched between Togo and Nigeria along western Africa’s Gulf of Guinea, Benin’s location -- crucial for enabling trade and transportation -- has an infamous past.

Home to 9.5 million people, present-day Benin has only existed for half a century. Before that, it was the powerful west African Kingdom of Dahomey, site of one of the busiest ports during the Atlantic slave trade -- a legacy that is still visible today.

A sluggish economy and residual ideology have made rapid change difficult. That said, for the past two decades, Benin has poured energy and funding into improving health care, access to education, potable water supplies and gender equality. Much progress has been made but challenges remain.

Kiva, recognizing the potential for microfinance to encourage development in Benin, has worked with multiple field partners in the country since 2008. In this post, we’ll take a closer look at Benin’s current political, economic and social climate. Through these lenses, we’ll discuss the need for microfinance and the role Kiva hopes to play in Benin’s future.

Following decades of ethnic strife, political instability and Marxist rule under President Mathieu Kérékou, Benin became the first African country to transition from a dictatorship to democracy. This sounds like progress, but after six years, the electoral process handed power back to Kérékou, who renounced his Marxist ideology and ran the country until 2006. While the newly democratic president repealed disastrous economic policies he had put in place years earlier, he failed to address the widespread corruption they caused.

In 2006, Kérékou exceeded the age limit for candidacy established by the Constitution and graciously stepped aside. This gave Benin a chance to elect fresh leadership for the first time in over a decade. After running under the slogan “Change,” President Yayi Boni has lived up to this promise during the last six years, making primary school free on top of other policy shifts.

For the last 20 years, however, Benin has struggled to rebuild its economy. At its worst, the country had a -3.75% GDP and was unable to pay civil servants, university faculty and military personnel for two years. Boosted by G8 debt reduction efforts, foreign investment, and membership to the CFA Franc (a currency guaranteed by the French treasury), Benin has steadily increased its GDP. Nevertheless, poverty remains at a high 37%.

Benin’s cycle of poverty is fueled by limited infrastructure and access to education and health care. Case in point, more than 25% of the population has no access to safe, secure sources of water. On top of that, only 12% of people have access to modern sanitation systems. As a result, diseases like malaria and cholera have become commonplace. These conditions keep children out of school and adults out of work, slashing productivity and income.

Education is also seriously underdeveloped. Lack of access and cultural emphasis on education has left 33% of the population illiterate. These stats only get worse when you look exclusively at women and girls.

Benin has an interesting history when it comes to gender equality. At times, it has seemed incredibly progressive, integrating female warriors into its armed forces as early as 1600. But it wasn’t until 2003 that Benin outlawed female circumcision. In 2009, it ranked 74th out of 102 countries on the OECD’s Social Institutions and Gender Index, which measures gender equality. The country’s infant mortality rate is in the top 10% of the world, with a maternal mortality rate in the top 20%. And, particularly in rural areas, child marriage persists.

Benin recognizes that the road to economic recovery includes gender equality and empowerment, and is taking steps toward improving the lives of women. In 2004, polygamy was prohibited and women were granted inheritance and property rights. A UNDP supported plan has also made including women in decision-making positions a key priority. More female voices in the political sphere will help improve the means, opportunity and education of Beninese women.

Kiva and its partners in Benin know that efforts to strengthen the country must include extending anti-poverty services, job and skills training, and other support to women and their families.

Benin’s respect for its Constitution and democratic process is promising. Political stability will be core to development. With solid leadership at the helm of the nation, we are excited to see how microfinance and Kiva will help establish economic prosperity, robust entrepreneurship and women’s empowerment.

Photos courtesy of Chillum, CIFOR, CIA World Factbook.