It is very difficult to have economic progress without a platform of political stability, as both domestic and foreign investors are unwilling to risk their resources unless they are confident that they will be secure. In the Togolese context, the lack of consensus over the operation of the political system between the government and the opposition parties is the main worry for international donors and the business community. Until these matters are resolved, Togo cannot expect to make progress in improving the living standards of its people.
Disagreements between the opposition and the ruling parties may lead to such a delay that new legislative elections (to replace the elections in 1999, widely seen as flawed) may not be carried out until the end of 2001. European Union aid will resume if new elections are seen to be free and transparent. It is likely that the United States and the IMF will follow suit. The government plans to restore stability to public finances, including the banking and financial sectors, and to revive the privatization process. Real GDP is expected to grow to 3.5 percent in 2001, and 3.8 percent in 2002, thanks to external assistance. Assuming a satisfactory harvest and a downturn in oil prices, inflation is forecast to fall to 2 percent in 2001 and 1.5 percent in 2002. Aid inflow means Togo's economy can be expected to improve between 2001 and 2002.
Following international pressure, a national independent electoral commission will oversee the 2001 election. The president has strengthened his international position through the presidency of the Organization of African Unity (OAU). A joint UN and OAU investigation is underway into the murder of political opponents in the 1998 election.
Though there has been little increase in revenue, a decrease in public expenditures has resulted in a lower deficit. In 2000 the economy was recovering from the 1998 recession , helped by an agricultural upturn and by the fact that the OAU summit was held in Lomé. Cotton output is estimated to have fallen to 110,000 metric tons in 2000 due to uneven rainfall, but cereal and coffee production both increased in the 2000-2001 season. The new Togo, Benin, and Nigeria power scheme should improve Togo's power situation.