Enhancing Burkina Faso Regional

Connectivity An Economic Corridor Approach

World Bank 2019

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Acknowledgements

This report was prepared by Aiga Stokenberga (Transport Economist, IAFT4) and Mathilde Lebrand (Economist, INFCE) under the leadership of Anca Cristina Dumitrescu (Lead Transport Specialist, IAFT4). Assistance with road quality data assembly was provided by Eddy Bynens (Consultant). Lisa Warouw (Program Assistant, IAFT4) and Desta Wolde Woldearegay (Program Assistant, IAFT2) provided coordination and logistical support. External inputs and comments were provided by Ulrike Wood-Sichra, Senior Research Analyst at the International Food Policy Research Institute (IFPRI), and by Melia Ungson, Swetha Ramaswamy, Katherine Quintero, and Grace Fenton of Fraym. The team would also like to express their gratitude to Megha Mukim (Sr. Urban Economist, SAFU1), Matias Herrera Dappe (Sr. Economist, IAFT2), and Mustapha Benmaamar (Lead Transport Specialist, IAFT3) for their comments on the draft final report, and to Soukeyna Kane (Country Director, AFCW3), Aurelio Menendez (Practice Manager, IAFT4), and Nicolas Peltier (Practice Manager, IAFT3) for overall guidance. On October 28, 2019, the study was presented to stakeholders from Burkina Faso, Togo, and Niger in an all-day workshop held in the World Bank offices in Ouagadougou, Burkina Faso. This served the purpose of relaunching the Lomé-Ouagadougou-Niamey regional project and resulted in rich discussions on project-level priorities as well as broader transport and trade facilitation priorities in the three countries on the following sub-topics: road infrastructure investment needs; logistics platforms (ports, border crossings, internal clearance terminals); transport sector reforms; and Customs reforms. The team would like to thank Cheick Diallo (Sr. Transport Specialist, IAFT4), Monica Moldovan (Young Professional, IAFT3), Olivier Hartmann (Sr. Private Sector Specialist, ETIRI), Jean Kanyamuhanda (Consultant, IAFT3), Lucien Barro (Consultant, SAFU1), and Helene Karambiri (Program Assistant) for their contribution organizing the event, delivering the presentation and guiding the discussions.

Abbreviations and Acronyms

ASYCUDA UNCTAD Automated System for Customs Data

AU African Union

CAGR compound annual growth rate

CMC Corridor Management Committee

ECOWAS Economic Community of West African States

FAOSTAT Food and Agriculture Organization Corporate Statistical Database

FCFA Central African Franc

GDP Gross Domestic Product

GIS Geographic Information Systems

GoT Government of Togo

GPS Global Positioning System

ICD inland container depot

IFPRI International Food Policy Research Institute

ISRT Inter-State Road Transit

ISTG Inter-State Road Transit of Goods

JICA Japan International Cooperation Agency

LPI Logistics Performance Index

LTNDP Long-Term National Development Plan (Ghana)

mt Metric tons

NDPC National Development Planning Commission (Ghana)

NEPAD New Partnership for Africa's Development

NRTTFC National Road Transport and Transit Facilitation Committee

NSDF National Spatial Development Framework (Ghana)

OSBP One-Stop Border Post

OTRAF Burkina Faso Road Transporters Organization (Organisation des Transporteurs Routiers du Faso)

PAMOSET Projet de Modernisation du Secteur des transports et facilitation du commerce sur le Corridor Abidjan-Ouagadougou

PDES Social and Economic Development Plan (Niger)

PNDES National Plan for Economic and Social Development (Burkina Faso)

PPP public-private partnership

REC Regional Economic Community

ReSAKSS Regional Strategic Analysis and Knowledge Support System

RTFCC Regional Trade Facilitation and Competitiveness Development Policy Credit

SCADD Strategy for Accelerated Growth and Sustainable Development (Burkina Faso)

SCAPE Strategy on Accelerated Growth and Employment Promotion (Togo)

SPAM Spatial Production Allocation Model

TEU twenty-foot equivalent unit

US$ United States Dollar

USAID United States Agency for International Development

WAEMU West African Economic and Monetary Union (Union Economique et Monétaire Ouest Africaine)

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Contents

Executive summary ........................................................................................................................................................................... 2

1. Context........................................................................................................................................................................................ 8

2. Objective and methodology ........................................................................................................................................................ 9

3. Regional and National Economic and Transport Policy Priorities .............................................................................................. 10

4. Transport and logistics characteristics of the corridors .............................................................................................................. 13

4.1. The corridors and their role in trade .................................................................................................................................... 13

4.2. Trade composition and partners ……………………………………………………………………. ………...……………………19

4.3. Corridor infrastructure condition and soft gaps ................................................................................................................... 21

4.4. Transport costs on the corridors ......................................................................................................................................... 26

5. The corridors’ socioeconomic characteristics and economic potential ...................................................................................... 29

5.1. Characteristics and economic importance of the corridor immediate vicinity ...................................................................... 30

5.2. Economic lagginess of sub-national regions in the study area ........................................................................................... 30

5.3. Economic potential of sub-national regions in the study area ............................................................................................. 37

5.3.1. Agglomeration potential and economic dynamism ...................................................................................................... 38

5.3.2. Agricultural potential .................................................................................................................................................... 40

5.3.3. Manufacturing potential ............................................................................................................................................... 43

5.3.4. Summary………………………………………………………………………………………………………………………….44

6. Expected economic impacts of corridor investments and policies ............................................................................................. 45

6.1. Regional-scale impacts: Insights from the application of a spatial general equilibrium model............................................ 47

6.2. National and sub-regional impacts in Burkina Faso: Evidence from spatial accessibility analysis ..................................... 52

7. Policy implications and conclusions .…………………………………………………..………………………………………...……….56

References ………………………………………………………………………………………………………………………………..….. 59

ANNEX 1 The region's infrastructure condition ………………………………………………………………………………...………….61

ANNEX 2 Economic lagginess and potential of regions within the study area: detailed rankings ……………………...………….. 61

ANNEX 3 Ongoing and proposed investments and reform policies ……………………………………………….……………..……. 68

ANNEX 4 Background and assumptions for the spatial economic model and detailed results ……………………………...……… 69

ANNEX 5 Detailed results of the spatial accessibility analysis ………………………………………………………………...………...73

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Executive summary Regional integration and international connectivity via economic corridors play an essential role in reducing the isolation of West Africa’s landlocked countries such as Burkina Faso. Connectivity is key for poverty alleviation and welfare in the more economically lagging regions and for unlocking the economic potential of agricultural areas and cities. As suggested by their respective national development strategies, Burkina Faso as well as the three neighboring countries considered in this study (Niger, Ghana, and Togo) all recognize the importance of transport corridor and rural infrastructure investment in advancing development goals, economic transformation, and poverty reduction. The objective of this study is to help define specific transport investment and complementary policy priorities. Burkina Faso’s main international corridors are the Ouagadougou-Lomé road corridor connecting it to Togo, the Ouagadougou-Tema (Ghana) road corridor, and the Ouagadougou-Niamey (Niger) road corridor, as well as the Ouagadougou-Abidjan (Cote d’Ivoire) road and rail corridors. In addition, the Niamey-Lomé (Niger-Togo) eastern road corridor that also crosses Burkina Faso and uses the Burkina Faso-Togo border crossing at Ponio represents a potentially important alternative corridor for landlocked Niger’s international trade. Each of the corridors plays a unique role in regional integration, national trade, and sub-national rural and urban development, by providing connectivity to consumption centers, economic production zones, and/or economically lagging areas. The importance of a corridor at the regional versus national versus sub-national level informs the investment and complementary policy interventions that should be prioritized to maximize the corridor’s overall impact. As summarized in Table 1, nearly all the corridors in scope have regional importance, being included in the Economic Community of West

African States (ECOWAS) and West African Economic and Monetary Union (WAEMU) lists of priority corridors based on factors such as their role in connecting the region’s capital cities, transit and trade volumes, and population catchment. The national perspective suggests that the Ouagadougou-Lomé corridor is very important for Burkina Faso’s imports, serving as the artery for about 40 percent of all cargo entering the country, while the Ouagadougou-Abidjan road and rail corridors play an equally crucial role in allowing Burkina Faso’s exports to reach global markets. On the other hand, Tema-Ouagadougou is of far greater importance for Ghana’s external and internal trade flows compared to Burkina Faso, serving as the main axis connecting Ghana’s northern regions to the more prosperous southern production areas and the port of Tema. In the case of Niger, the Niamey-Ouagadougou-Lomé corridor plays a significant role in the country’s external trade, carrying 15-20 percent of Niger’s import transit, while the role of the Niamey-Lomé eastern corridor through Burkina Faso is more aspirational, the route representing an alternative, albeit unutilized, trade artery for Niger.

Machine learning based analysis conducted for this study, which estimates the concentration of economic activity in the corridors’ immediate vicinity, sheds additional insights on their national-level importance. The Ouagadougou-Lomé 20-km buffer (radius) area represents a significant generator of economic activity for both Burkina Faso and Togo and concentrates an important share of the two countries’ populations. Similarly, the extended Niamey-Ouagadougou-Lomé corridor, linking Niger to Burkina Faso to the port of Lomé in Togo, is of major economic importance for Niger, despite the short length of the corridor located in its territory. The 20-km buffer area of the corridor concentrates as much as 28 percent of Niger’s Gross Domestic Product (GDP) and 7 percent of its population. For Burkina Faso, the respective figures are even higher – 40 percent and 21 percent – while for Togo they reach 72 percent and 65 percent. In comparison, the Ouagadougou-Tema corridor buffer area is of somewhat greater importance for Ghana, accounting for 39 percent of its population, compared to 15 percent in the case of Burkina Faso. However, in terms of the concentration of economic activity (GDP), the corridor’s buffer area is of comparable importance to both countries. Finally, the eastern route of the Niamey-Lomé corridor in Burkina Faso’s territory remains sparsely traveled and populated, with little economic activity generated in its direct area of influence. In contrast, the portion of the corridor located in Niger’s territory accounts for a major share of that country’s GDP (28 percent) and population (7 percent). Burkina Faso, similarly to its landlocked neighbor Niger, continues to rely on exports of a limited scope of (primarily) unprocessed commodities and minerals. It runs a significant trade imbalance with not only the rest of the world but also its neighbors. The trade imbalance vis-à-vis regional and global trading partners has direct implications for the landlocked countries’ international transport and trade costs, given the need for transport prices on northbound (full) cargo flows to also

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compensate for the southbound (mostly empty) flows. Identifying the economic potential that could be unlocked in each country at the sub-national level, thus reducing the trade imbalance over time, provides yet another lens through which corridor investment and complementary intervention priorities can be defined. Analysis conducted for this study using high-resolution agricultural and other spatial data reveals that, significant untapped production potential exists in the entire study area. The agricultural crop production potential is estimated at 12.84 million metric tons worth US$3.19 billion per year in Burkina Faso alone, compared to 7.47 million mt (US$2.05 billion) currently utilized. Among Burkina Faso’ sub-national regions crossed by the corridors in scope, current agricultural production and assessed potential production is highest in the Center-East located on the Ouagadougou-Lomé route, where currently about 560,000 mt of agricultural crops worth US$157 million are produced annually, with the potential to reach 940,000 mt (US$237 million).1 The consideration of not only agricultural production but also manufacturing and agglomeration dynamics at the sub-national level suggests greater overall economic potential in Ghana (except its Northern region) and Togo, the western regions of Burkina Faso, and individual regions in Niger that border Nigeria (see Figure 16). In Burkina Faso, Haut-Bassins on the route of the Ouagadougou-Abidjan corridor emerges as the region with consistently high estimated economic potential, regardless of the dimension. The Central region (home to Ouagadougou and the origin of the Ouagadougou-Lomé and Ouagadougou-Tema corridors) and Plateau-Central (on the Ouagadougou-Niamey axis) also appear to present high potential along most indicators. Investments in transport infrastructure in these regions would presumably have a higher economic return than in those where economic potential is assessed to be low. When considering the economic “lagginess” of the sub-national regions, as defined by high poverty rates and low economic activity, the need for connective investment and complementary policy interventions appears to be greatest in the predominantly low-density parts of the study area, such as Burkina Faso’s North region. However, it is high also in the relatively densely populated regions of Niger that are close to the capital city and the Niamey-Lomé/Niamey-Ouagadougou corridors – Tillaberi and Dosso – as well as in the Plateaux region in central Togo that is traversed by the Ouagadougou-Lomé and the Niamey-Lomé corridors. The region’s trunk road infrastructure is in fair-to-good condition on most sections, although large gaps remain on corridors such as the eastern link between Lomé and Niamey. Several factors that add to cost of transport remain also in terms of the “soft” aspects of transport and trade facilitation, including lingering freight sharing agreements that reduce the competitiveness of transport service provision, little use of direct contracting of trucking services, low level of professionalization of the overall trucking and logistics industry, and inefficiencies in border crossing and Customs processes despite some recent investment in the physical border crossing facilities. Trucking costs absorb the largest share (>60 percent) of the total corridor transport costs for imports into Burkina Faso, while ports and border crossings/inland terminal clearances represent another 20 percent and 15 percent, respectively. The Ouagainter internal clearance terminal in Ouagadougou has seen impressive improvements in both cost and time in recent years; however, only slight improvements on all corridors have been observed in the transport leg. In terms of the port leg, Lomé saw significant time and cost reductions, in contrast to Tema or Abidjan. The study develops several scenarios of corridor interventions that address the above inefficiencies to quantify the expected impacts in terms of real income growth (via growth in trade) and domestic market accessibility. To do so, it applies two complementary analytical tools, or “lenses”: a spatial general equilibrium model and a Geographic Information System (GIS) based analysis.

Regional and Sub-National Real Income Growth Impacts: Opportunities for better integration with foreign markets and subsequent economic gains are not even across sub-national regions within countries; they are driven by factors such as the potential to produce tradable goods (agricultural, manufacturing, etc.) and the region’s connectivity to the main transport corridors. Using a spatial general equilibrium model, we test six scenarios of corridor intervention “packages” to assess the expected impacts on real income growth at the District level in Burkina Faso and Niger, the study area’s two landlocked countries, using data on the District-level land area, number of employees, sectoral shares of employees, and transport costs. Four of the scenarios focus exclusively on corridor infrastructure improvement – (1) the Niamey-Lomé eastern corridor section in Burkina Faso, (2) the Niamey-Lomé/Niamey-Ouagadougou corridor section in Niger, (3) the Ouagadougou-Lomé/Niamey-Lomé corridor

1 Monetary value of production calculated by IFPRI using past average international prices.

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section in Togo, and (4) the three investments combined. The final two scenarios consider: (5) the combination of all three corridor infrastructure improvements and the halving of the transport fixed costs, such as through improved competition and transparency in the trucking services market and (6) the combination of all three corridor infrastructure improvements and the halving of international border and port costs, such as through improved port efficiency that reduces the truck turnaround times when picking up cargo. The model results suggest that Niger in particular can be expected to benefit from infrastructure investment on the transport corridors that link it to Burkina Faso and further to the port of Lomé, with real incomes to increase by between 0.17 percent (assuming the improvement of the corridor section in Togo) and 0.52 percent (assuming the improvement of the corridor section in eastern Burkina Faso). In the case of Burkina Faso, the expected real income growth is much more modest, except in the case of the improvement of the Ouagadougou-Lomé/Niamey-Lomé corridor section in Togo which would increase Burkina Faso’s real income by about 0.12 percent. This latter result is intuitive given the superior importance of the Ouagadougou-Lomé corridor in Burking Faso’s external trade flows and the high economic potential of the areas the corridor crosses (e.g. the Center-East region). However, the most important observation from this analysis is that complementary interventions that make the transport sector more efficient and reduce border and port costs would substantially amplify the income gains from corridor infrastructure improvements for both Niger and Burkina Faso. The gains would be particularly high for Burkina Faso with the complementary reductions in the fixed costs of the transport leg, increasing real incomes by 1.39 percent, compared to 1.32 percent in the case of complementary reductions in the fixed border and port costs. For Niger, the result is inverse: halving of the border and port costs (in addition to the infrastructure improvements) would increase real incomes by 2.57 percent, compared to 2.32 percent if assuming the complementary reductions in the fixed costs of the transport leg. Under all scenarios, Niger, on average, is expected to benefit more than Burkina Faso, the difference in income gains being the smallest in the case of the Ouagadougou-Lomé/Niamey-Lomé corridor improvement in Togo. The real income gains will be unevenly distributed also at the sub-national level: in each of the two countries, real income growth would be five to six times higher in the District that will gain the most compared to the District that will gain the least. Only the Districts with high potential to produce tradable goods and those that are well-connected will get the most out of corridor investments: for example, in the absence of good quality roads between the locations of export production, especially agriculture, and the main corridors, the impacts of corridor infrastructure investment on exports will remain limited. A more comprehensive, integrated policy approaches will more effectively support local value creation and development of areas along the corridors, preventing the wider economic benefits from being spatially concentrated only in the main corridor nodes. Domestic Market Access Impacts: Corridor and adjacent road improvement will also have more localized economic impacts, through improved access to domestic markets for consumers and producers. To quantify these impacts for Burkina Faso specifically, we test four scenarios through the application of GIS-based accessibility analysis. The first three scenarios build upon each other, considering (1) the improvement of the Niamey-Lomé eastern corridor section in Burkina Faso, (2) in addition to the improvement of a portion of the Niamey-Ouagadougou axis in Burkina Faso, (3) in addition to the improvement of the secondary and tertiary roads connecting these two corridor sections. The final scenario considers the improvement of road sections in southern Burkina Faso that provide a connection between the Ouagadougou-Tema and the Ouagadougou-Lomé corridors. At present, 54 percent of the country’s population is estimated to live within 2 hours of motorized travel to the nearest major city (market), while 5 percent live 5 or more hours away – the country’s North and East region, the latter crossed by the Niamey-Lomé eastern corridor, are characterized by particularly low accessibility. The analysis finds that the improvement of the Niamey-Lomé eastern corridor section in Burkina Faso would result in a significant reduction in travel time to the nearest major local market for about 19,000 people; the added rehabilitation of the eastern half of the Niamey-Ouagadougou axis would increase the number of beneficiaries to nearly 64,000, while the added improvement of the more minor roads connecting these two corridors would make the biggest difference, nearly doubling the figure to 119,000. Finally, the improvement of the road connecting the

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Ouagadougou-Tema and the Ouagadougou-Lomé corridors in southern Burkina Faso would significantly reduce travel time to a major city for about 34,000 people, hence, double the number of beneficiaries as expected from the improvement of the Niamey-Lomé eastern corridor.

In addition to the market accessibility benefits for the local consumers, the improvement of the Niamey-Lomé eastern route in Burkina Faso would result in a significant reduction in travel time to market for an annual volume of about 5,200 mt of staple crops – rice, maize, millet, and sorghum (12,000 mt if assuming full utilization of production potential), with an annual market value of US$650,000 (US$2 million). The added improvement of the Niamey-Ouagadougou corridor would increase this figure to 30,000 mt (69,300 mt), worth US$3.7 million (US$11.2 million), while the addition of improvements of the roads connecting the two corridors would raise it to 47,000 mt (>100,000 mt), worth US$5.7 million (US$16.2 million). Good accessibility to local markets is yet more important for the incomes of the agricultural producers growing perishable agricultural produce such as fruits and vegetables, given that it can rapidly lose value in the absence of a well-integrated cold chain and risks to be damaged if transported for long hours. The improvement of the Niamey-Lomé eastern route would significantly reduce travel time to market for 475 mt of perishable produce annually, worth about US$136,000 (or 640 mt worth US$187,000 if assuming the utilization of the full production potential). The added improvement of the Niamey-Ouagadougou route would increase those figures more than five-fold, to over 2,500 mt worth US$770,000 (or 4,000 mt worth US$1.2 million). Finally, the added improvement of the connecting roads would bring nearly double the volume and value of produce closer to market compared to the scenario in which only the main corridor sections in eastern Burkina Faso are rehabilitated. In contrast to the market accessibility benefits for consumers, the improvement of the roads connecting the Ouagadougou-Tema and Ouagadougou-Lomé corridors in southern Burkina Faso would have less of an impact on market accessibility for agricultural produce – either staple crops or perishable goods – compared to the improvement of the Niamey-Lomé eastern corridor.

To conclude, depending on the perspective applied, the investment and policy priorities that emerge differ to some extent. Analysis of the national-scale relevance of each of the corridors highlights the particularly high economic importance of the Ouagadougou-Lomé and the extended Niamey-Ouagadougou-Lomé corridors for three of the region’s economies (Niger, Burkina Faso, and Togo), in contrast to the Niamey-Lomé eastern corridor which does not move significant trade volumes nor generates much economic activity in its direct vicinity in Burkina Faso; it therefore does not appear to be a priority corridor for improvement from Burkina Faso’s national perspective. The Ouagadougou-Tema corridor is a major trade artery for Ghana and a concentrator of economic activity in both Ghana and Burkina Faso; therefore, its future improvement would directly benefit local production in both countries. Further, the sub-national perspective suggests that investment in the Ouagadougou-Tema or the Ouagadougou-Lomé corridors in particular would allow developing the high production potential of several sub-national regions of Ghana, Togo, and Burkina Faso. Improvement of the Ouagadougou-Lomé corridor would be especially important for unlocking the high agricultural potential of Burkina Faso’s Center-East region and of the southern- and northern-most regions of Togo. Finally, investment in the Niamey-Lomé eastern corridor and the Niamey-Ouagadougou route may be prioritized more if applying the economic lagginess metric and the need to “link in” economically fragile areas. To realize either the trade or the domestic market access benefits of corridor improvements, complementary interventions will be essential to maximize the value of the corridor infrastructure investments. Complementary border crossing and port efficiency improvements as well as reductions in the fixed costs of transport will significantly enhance the real income gains that can be expected from corridor infrastructure improvement. Local production capacity of tradable goods must be strengthened through providing last-mile links to sub-national regions with high production potential, and the trunk corridor infrastructure investment accompanied by investment in rural access and ancillary facilities like agricultural consolidation and processing centers, to allow agricultural value chains and higher value-added agricultural sectors to prosper. In other words, a key challenge for Burkina Faso and its neighbors is to transform the transport corridors into fully integrated economic corridors, complementing high-quality trunk corridor infrastructure and functioning border crossings with well-developed production and logistics chains that allow tapping the full agricultural and manufacturing potential and promote trade with global and sub-regional markets.

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Table 1: Summary of regional, national, and sub-national relevance of the corridors

Corridor Regional importance National importance Corridor role in connecting high-potential or lagging sub-national regions

Impacts of scenario interventions

Ouagadougou-Abidjan

ECOWAS and WAEMU priority corridor

~30-35% of imports enter BFA through this corridor; over 55% of BFA exports travel on this corridor (cotton) Serves CVI’s internal trade (domestic traffic ~90% of Port of Abidjan traffic)

BFA: Ag. potential: Haut-Bassins, Centre-Ouest, and Cascades; Agglomer. potential: Haut-Bassins, Centre-Ouest, and Cascades; Manuf. potential: Centre

Not assessed (corridor has been studied in detail as part of previous World Bank operations)

Ouagadougou-Tema

ECOWAS corridor Corridor 20-km buffer zone: 29% of BFA/GHA combined population and 41% of their GDP

~25% of imports enter BFA through this corridor A gateway corridor for GHA (80-90% of cargo on the corridor has a GHA origin and destination) Corridor 20-km buffer zone: GHA: 39% of pop., 42% of GDP, 26% of the poor; BFA: 15% of pop., 36% of GDP, 2% of the poor

BFA: Agglomer. potential: Centre-Sud (rapid increase in the share of urbanized land); Manuf. potential: Centre GHA: Ag. potential: Greater Accra, Upper East, Eastern; Agglomer. potential: Brong Ahafo, Northern, and Ashanti; Manuf. potential: Greater Accra, Upper East, Eastern

Domestic market accessibility impacts: Rehabilitation of N20 and N25 in southern BFA (connecting the corridor to nearby regions): BFA: Significant reduction in travel time for 34,000 people; 4,600 mt of staple crops (7,900 mt if assuming full utilization of ag. potential) with an annual market value of US$460,000 (US$1.2 million)

Ouagadougou-Lomé

ECOWAS and WAEMU priority corridor Serves significant bilateral trade between TOG and BFA (clinker) Lomé-Ouagadougou-Niamey extended corridor 20-km buffer: 42% of BFA/TOG/NER combined GDP and 23% of their pop.

Primary gateway corridor for BFA: ~40% of imports enter BFA through this corridor Corridor has high importance for TOG’s industrial development Lomé-Ouagadougou-Niamey extended corridor 20-km buffer: BFA: 21% of pop., 40% of GDP, 8% of the poor; TOG: 65% of pop., 72% of GDP, 37% of the poor

BFA: Ag. potential: Centre-Est (high staple crop production potential and high density of livestock production; Agglomer. potential: Centre-Est (rapid increase in urbanized land); Manuf. potential: Centre TOG: Ag. potential: Maritime (both staple and cash crops), Savanes (staple crops), Plateaux (staple crops); Agglomer. potential: Centre, Savanes (rapid pop. growth); Manuf. potential: Maritime, Kara; Lagging: Plateaux

Real income growth impacts: Rehabilitation of RN1 in TOG: BFA: 0.12%; NER: 0.17%

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Niamey-Ouagadougou

ECOWAS and WAEMU priority corridor; part of the Trans-Sahelian Highway Connects the capital cities of BFA and NER, serving the countries’ bilateral trade

The most commonly used connection for NER’s trade via the Port of Lomé; Lomé-Ouagadougou-Niamey carries 15-20% of NER’s import transit Lomé-Ouagadougou-Niamey extended corridor 20-km buffer: BFA: 21% of pop., 40% of GDP, 8% of the poor; NER: 7% of pop., 28% of GDP, 1% of the poor

BFA: Agglomer. potential: Est (rapid increase in urbanized land) NER: Ag. potential: Niamey (staple crops); Manuf. potential: Niamey; Lagginess: Tillaberi

Real income growth impacts: Rehabilitation of NR6 in NER: BFA: none; NER: 0.25% Domestic market accessibility impacts: Rehabilitation of N4 in BFA (assuming that NR19 is also rehabilitated): BFA: Significant reduction in travel time for 64,000 people; 30,000 mt of staple crops (69,300 mt if assuming full utilization of ag. potential) worth US$3.7 million (US$11 million); and 2,500 mt of perishable produce worth US$770,000 (4,000 mt, US$1.2 million)

Niamey-Lomé (eastern)

Corridor 20-km buffer: 15% of the combined BFA/TOG/NER population and 23% of their combined GDP

The corridor represents an alternative route for NER to access the Port of Lomé (150 km shorter than Niamey-Ouagadougou-Lomé) Corridor 20-km buffer area: TOG: 65% of pop., 71% of GDP, 52% of the poor; NER: 7% of pop., 28% of GDP, 1% of the poor; BFA: 2% of pop., 1% of GDP, 3% of the poor; poverty rate inside the 20-km buffer is higher than outside (68% vs. 52%)

BFA: Agglomer. potential: Est (rapid increase in urbanized land) NER: Ag. potential: Niamey (staple crops); Manuf. potential: Niamey; Lagging: Tillaberi TOG: Ag. potential: Maritime (both staple and cash crops), Savanes (staple crops), Plateaux (staple crops); Agglomer. potential: Centre, Savanes (rapid pop. growth); Manuf. potential: Maritime, Kara; Lagging: Plateaux

Real income growth impacts: Rehabilitation of NR19 (BFA), NR6 (NER), and RN1 (TOG): BFA: 0.13%; NER: 0.95% Rehabilitation of NR19 (BFA), NR6 (NER), and RN1 (TOG) + halving of fixed transport costs: BFA: 1.39%; NER: 2.32% Rehabilitation of NR19 (BFA), NR6 (NER), and RN1 (TOG) + halving of border and port costs: BFA: 1.32%; NER: 2.57% Domestic market accessibility impacts: Rehabilitation of NR19 in BFA: BFA: Significant reduction in travel time for 19,000 people; 5,200 mt of staple crops (12,000 mt if assuming full utilization of ag. potential) with annual market value of US$650,000 (US$2 million); and 475 mt of perishable produce worth US$136,000 (640 mt, US$187,000)

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1. Context Transport corridors connect ports, and thus international trade flows, to surrounding hinterlands, sometimes across borders. However, they also hold the potential to promote integration within or between countries and regions, and to support linkages between industries, firms, and people. The economic corridor approach looks at regional transport routes not only as a means of transporting goods and services or as a gateway for landlocked countries but also as a tool for stimulating social and economic development in the surrounding areas. Economic corridors accomplish this by creating ancillary facilities in conjunction with core transport infrastructure. In doing so, they help develop rural and border areas, create employment and increase household earnings. Literature on the topic distinguishes between several stages of corridor transformation: (1) physical development (upgrading infrastructure, revamping transport links), (2) logistics development (facilitating storage, warehousing, trucking, insurance and freight management), and (3) economic and social development (investments in areas such as agroindustry, manufacturing, special economic zones along the corridor). Developing economic corridors also depends on the regulatory structure which impacts growth of economic activity, availability of other necessary infrastructure such as electricity and water, and incentives for production and trade (see, e.g., USAID, 2017). In a landlocked country such as Burkina Faso, regional integration and international connectivity via economic and logistics corridors play an essential role in reducing isolation vis-à-vis the outside world. Connectivity is key for poverty alleviation and welfare in the more economically lagging regions, and for unlocking the economic potential of agricultural areas and urban centers. For its international transport, Burkina Faso has a choice between several transit ports, enabling it to take advantage of competition between various access corridors. International road transport flows (imports and exports) follow three main international transit corridors to and from Ouagadougou, Burkina Faso’s capital and largest city: Ouagadougou-Lomé (950 km);2 Ouagadougou-Tema (1,040 km), and Ouagadougou-Abidjan3 (1,100 km); as well as the Trans-African/Sahelian West African Economic and Monetary Union (WAEMU) corridor linking Ouagadougou to Niamey in Niger (~500 km)4 and to Bamako in Mali (970 km). Except for rail traffic between Ouagadougou and Abidjan, the rest of Burkina Faso’s traffic moves along corridors by road. Burkina Faso is the most important user of the port of Tema besides Ghana itself: its transit traffic represents 70 percent of total Tema international transit traffic (2012). However, about 70 percent of Burkinabè import comes through the ports of Lomé and Abidjan – 40 percent and approximately 30 percent, respectively (Saana Consulting, 2015a). Ghana and Cote d’Ivoire also represent a large share of Burkina Faso’s overall imports by value – about 16 percent and 11 percent, respectively – while Niger and Togo each represent about 4 percent (Harvard University, 2016). Niger’s international trade relies mainly on the Cotonou-Niamey axis, but Niamey-Ouagadougou-Lomé is the next most important international transit corridor. Togo is more dependent on regional trade than other coastal countries such as Ghana or Cote d’Ivoire, due to the limited size of its domestic market: Togo’s domestic traffic represents only 26 percent of the activity at Lomé port, transit represents 18 percent, and the balance is transshipment. Rail transport in West Africa is limited and links only two capital cities with ports for the movement of freight; Abidjan (Côte d'Ivoire) to Ouagadougou (Burkina Faso) and Dakar (Senegal) to Bamako (Mali).5 The only other rail link in West Africa can only be used in combination with road for the movement of goods from a seaport to a commercial capital in the hinterland (Cotonou–Niamey rail-and road corridor). Rail plays an important role on the Ouagadougou-Abidjan corridor. Available research shows that transport costs in West Africa are reasonably low, due to the low labor cost, use of old trucks, etc.; in contrast, the transport prices paid by shippers are relatively high, as a result of a combination of several market distortions and poor transport sector governance, among other factors (Bove et al., 2018, provide a full account of the political economy issues in West and Central Africa’s trucking sector).

2 While the road corridor from Lomé to Niamey transits Burkina Faso, it does not need to go through Ouagadougou. The existing corridor goes through Fada N’Gourma; however, the distance between Lomé and Niamey can be reduced by about 150 km by using the currently unutilized route crossing eastern Burkina Faso and the Togo-Burkina border at Ponio. 3 This corridor is not analyzed in detail in the current study because it was/is already extensively covered by a regional budget support operation on trade facilitation and logistics reforms financed by the World Bank and subsequent ongoing technical assistance projects in both countries. The results of the first operation in the series are summarized in Annex 2. A brief description of the corridor is provided in Section 4. 4 Ouagadougou-Dori-Tera-Farie-Namaro-Niamey, according to UEMOA list of Community Roads 5 Although Dakar-Bamako railway corridor has not been operational since 2018

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Road infrastructure on the main corridors has benefited from the support of the donor community, and notable improvements have been achieved. Similarly, policy reforms to correct the market distortions and increase the value of such investments in infrastructure have started to follow.6 USAID (2017) assessed the road connectivity among Burkina Faso, Ghana, Togo, and Niger to be good to fair, as all capital cities and main population centers are linked with paved roads. Nevertheless, the current level of the road condition is variable, as later sections of this study will explain in more detail. The transport sector is still dominated by a large majority of small, informal, and inefficient transporters who rely on intermediaries and market organizers to find freight. While this opaque allocation creates sizeable rents, truckers only obtain break-even rates. Low profitability creates strong incentives for small truckers to resort to short-term survivalist behaviors, including through overloading of trucks beyond the legal axle load limit. Overloading adversely affects the durability and safety of operations, damages the road network, and discourages containerization. In addition, and specific to a landlocked country like Burkina Faso, due to the high imbalance between import and export volumes, most of the trucks return to the ports empty (Bove et al. 2018), pushing up the transport prices for inland-bound cargo. While reforms in the transport sector services are ongoing in Burkina Faso and Togo, the situation is dire in Niger, which has only sporadically benefitted from support in these areas. Another major problem affecting the profitability of the trucking industry and increasing trade costs is the slow rotation time on corridors, that is, the small number of roundtrips from Ouagadougou to any of the ports and/or international destination by the average truck. This is the result of a combination of several factors, including delays at the port, difficulty to find backhaul cargo, and cumbersome border and transit procedures in both coastal and hinterland countries. Long delays at the border and multiple customs and police controls, Customs escorts (in Burkina Faso), lack of harmonized transit procedures and Customs interconnection are among the issues affecting the region. Joint border posts have just started to be operational; however, improved efficiency and reduced time passed by trucks at the border have not yet been achieved.

2. Objective and methodology Based on the critical importance of transport links for the economy, the Government of Burkina Faso has placed importance on supporting transport and logistics related activities in its long-term development strategy. The Government’s objective is to establish well-functioning links to the neighboring countries, via putting in place appropriate infrastructure and reliable and less costly transport services. In parallel with the function that transport infrastructure and policy interventions can play in expanding the country’s international trade and unlocking the productive potential of certain regions, however, their prioritization can also be viewed through the lens of poverty alleviation, accessibility to local markets, and linking-in of economically lagging, isolated areas. Due to the scarcity of resources, it is important that Burkina Faso takes well-informed decisions on which infrastructure investments and policies can amplify the net benefits, viewed through either of the lenses. Moreover, the transport infrastructure and trade facilitation measures implemented in Burkina Faso may have effects well beyond its borders, possibly generating sizable economic benefits for some regions in its neighboring countries while reducing the competitiveness of others. The objective of this study is to help prioritize transport infrastructure investments and related policy interventions in Burkina Faso and its neighboring countries. Specifically, it aims to inform regional transport operations involving Burkina Faso, such as the World Bank-financed Lomé-Ouagadougou-Niamey Regional Corridors Project, currently under preparation. It complements the knowledge generated through the ongoing PAMOSET project financed by the World Bank (focused on logistics and trucking industry reforms) and expands on the recent West and Central Africa Trucking Competitiveness Study (Bove et al., 2018). After reviewing the regional and national economic and transport policy priorities, the remainder of the study includes:

6 Recent projects supporting transport policy reforms are: Abidjan-Ouagadougou DPO series (closed 2017); and the ongoing PAMOSET, a Technical Assistance project financed by the World Bank to help implement reforms focused on the trucking industry, including related to overloading, professionalization, and fleet renewal.

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(i) An analysis of the economic costs of inefficiencies of the transport/logistics systems on the Ouagadougou-Lomé, Ouagadougou-Tema, Niamey-Ouagadougou-Lomé, and Niamey-Lomé-(via the Ponio border crossing in Togo and eastern Burkina Faso) road corridors, through a comprehensive characterization of the transport infrastructure and “soft” bottlenecks that increase transport and trade costs on these trade routes;

(ii) Characterization of the economic characteristics of the areas the corridors connect:

• The economic importance of the immediate (20-km radius) “buffer” zones of each of the corridors in scope;

• The economic potential and the economic “lagginess” of the sub-national regions of the four countries; and

(iii) An estimate of the economic impacts – both local and regional – of alternative road improvements and trade facilitation measures on the selected corridors by applying two complementary analytical approaches – a spatial general equilibrium model and GIS-based local accessibility analysis.

3. Regional and National Economic and Transport Policy Priorities

Over the past two decades, African Union (AU) programs such as NEPAD and the programs developed by the Regional Economic Communities (RECs) have all increasingly placed priority on enhancing interconnectivity and facilitating trade by focusing on transport corridors as microcosms of integration and spatial development (Nathan Associates, 2013). The vision of the Economic Community of West African States (ECOWAS), of which Burkina Faso, Togo, Niger, and Ghana are member states, is a single market with free movement of persons, near seamless movement of goods and cross-border business stimulating intra-regional trade, increased value-added production and regional integration. The primary structure for achieving this vision is the Corridor – a highway, railway, or intermodal system that connects multiple states and offers efficient, cost-effective transport and logistics services for travel, trade and other types of business (USAID, 2017). BURKINA FASO A long-term vision study on “Burkina 2025”, completed at the end of 2005, proposes an accelerated growth model focused on growth poles, niche production, and pro-poor growth. The sectors prioritized for development include agriculture, mining, crafts, culture and tourism related industries, and small and medium enterprises. A key strategic orientation of the vision is the promotion of economic integration and foreign trade, including the opportunities they offer for domestic production. The vision also prioritizes the development of infrastructure and transport and logistics services to support agro-pastoral businesses, create jobs, and reduce poverty. The subsequent Strategy for Accelerated Growth and Sustainable Development (SCADD 2011-2015) highlights the necessity to correct weaknesses of the economy, vulnerability to external shocks, and low agricultural productivity, in addition to high production cost and raising poverty levels. It considers “Burkina 2025” and adopts a poverty reduction approach focused on developing local productive capacities (JICA, 2018b). The National Plan for Economic and Social Development (PNDES 2016-2020) aims at structurally transforming the Burkinabe economy, through developing a productive agro-forestry-pastoral sector, a competitive industrial and artisanal sector, high value-added services industries, and high quality infrastructure that fosters the structural transformation of the economy.7 Among others, the expected impacts of PNDES is a decrease in the incidence of poverty to less than 35 percent. The Ministry of Infrastructure formulated a Strategy Paper for the Burkina Faso Transport Sector for 2011-2025, and currently two key projects are under implementation: modernization of truck fleet registration and truck fleet renewal (JICA, 2018b). TOGO

7 Plan National de Développement Economique et Social (PNDES) 2016-2020, pp. 42-43.

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The Strategy on Accelerated Growth and Employment Promotion (SCAPE 2013-2017) offers a development framework for Togo for the medium term. Its five strategic areas include the development of high growth potential sectors; strengthening economic infrastructure; development of human capital, social protection and employment; strengthening governance; and promoting participatory, balanced and sustainable development. Agricultural sectors, trade, services, mining, manufacturing and tourism are considered as the main generators of strong and sustainable growth. In an important aspect of the SCAPE related to the infrastructure sector, the Government of Togo (GoT) places emphasis on utilizing the advantages of having a deep-water seaport to develop a North-South logistics corridor for development and trade. The North-South corridor is also envisioned to play a key role in bridging the wealth gaps among the sub-regions it crosses (JICA, 2018b). As part of the implementation of the North-South Development Corridor, the GoT intends to rely on public-private partnership (PPP) mechanisms for financing major infrastructure projects. The more recent National Development Plan for 2018-2022 (République Togolaise, 2018) identifies the main priorities that Togo must address to achieve a structural transformation of the economy: e.g., development of a logistics and transport chain around the Port of Lomé by integrating it into a renovated transport network; development of value chains in the agro-sylvo-pastoral sector through the establishment of “agro-poles” combining several activities (food crops, aquaculture, processing and research); creation of integrated industrial parks for export-oriented and labor-intensive industries (e.g. textiles); and the development of the phosphate processing sector and the strengthening of the limestone processing sector. In 2015, Togo’s National Transportation Policy for 2014-2030 was formulated based on SCAPE. The Policy emphasizes the importance of the improvement and maintenance of the National Road No.1 between Lomé and Cinkassé as a national North-South corridor. At the same time, the need to rehabilitate East-West connecting roads and access bridges to neighboring countries is stressed in order to improve access to major agricultural production areas (JICA, 2018b). GHANA Ghana’s most recent Coordinated Programme of Economic and Social Development Policies, 2014-2020, outlines two main priorities: good governance and the promotion of light manufacturing that builds upon Ghana’s existing natural resource endowments, such as agro-industry and wood processing. In the recent Government of Ghana policies, a key challenge identified is the need to form more economically and spatially integrated sub-regional economic relationships between Ghana and its neighbors, whereby Ghana could attract foreign and domestic investment in the development of productive sectors targeting sub-regional markets, as well as overseas markets. The National Spatial Development Framework (NSDF) is a 20-year strategy for spatial development at the national level. Concentrated development is recommended as an overall policy in the NSDF. This policy will be implemented through strategies such as promoting urban settlements along major transport corridors and maintaining and improving the efficiency of the main expressway network. The preparation of the 40-year Long-Term National Development Plan (LTNDP) was launched in 2015 by the National Development Planning Commission (NDPC). The NDPC has also prepared a National Infrastructure Plan (2018-2047). The NSDF 2015-2035 proposes the development of several transport links, including a national and international expressway system (e.g. Accra-Kumasi and Kumasi-Paga expressways); new and improved trunk roads (e.g. around Lake Volta); a national and international railway network; and an agricultural growth corridor (e.g. a trunk road from Accra to Bolgatanga) (JICA, 2018b). In February 2017, the Ministry of Railways Development was established for ensuring the rapid development of the railway network, partly due to the needs of the mining industry, and has identified several railway lines as their priority projects, including the Accra-Kumasi Line (300 km) and Kumasi-Paga (Central Spine) Rail (595 km) (JICA, 2018b). NIGER Acceleration of economic growth by investing in rural infrastructure is highlighted as a focus area in Niger’s Social and Economic Development Plan (PDES 2017–2021). The National Strategy of Transport of Niger (2016-2025), covering road, rail, and inland water transport, aims, among others, to optimize the development and management of the transport infrastructure to support the country’s socio-economic development and to facilitate transport and transit through major corridors through the development of road and rail infrastructure, as well as by improving the supply chain and simplifying

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procedures. The country’s Investment and Action Plan for the Implementation of the National Transport Strategy 2016-2025 includes, among other planned tasks, a study of transport demand, coordination of the different modes of transport, and definition of investment priorities in the sector. The expected outputs are a master plan for the country's transport infrastructure networks, in particular the road network, and a well-grounded prioritization of transport infrastructure investments.

Box 1: ECOWAS and WAEMU priority corridors

The Economic Community of West African States (ECOWAS), founded in 1975, is a regional group of fifteen countries, including Burkina Faso, Cote d’Ivoire, Ghana, Niger, and Togo. Its mission is to promote economic integration in all fields of economic activity, particularly industry, transport, telecommunications, energy, agriculture, natural resources, commerce, monetary and financial questions, social and cultural matters. ECOWAS has not formally established regional corridors, nor a formal process for the identification of regional transport corridors (USAID, 2017). The legal document for the definition of regional routes is the Interstate Road Transport Convention (IRT), Cotonou, 29th May 1982. The Convention identifies 97 regional routes located in 14 countries defined by towns, centers, ports and border posts. The document does not suggest any hierarchy or Corridor structures within the identified routes. Corridors in the ECOWAS region have also been defined by various studies and initiatives to promote regional trade, such as the Program for Infrastructure Development in Africa (PIDA). Generally, corridors are based on existing road transport infrastructure and the desire to connect all countries and, specifically, their capital cities. Regional Routes in the ECOWAS IRT include, among others, the corridor connecting Cote d’Ivoire and Burkina Faso (Abidjan-N'Douci-Toumodi-Yamoussoukro-Tiébissou-Bouaké-Katiola-Ferkessedougou-Ouangolodougou-La Léraba-Burkina Faso); Ghana to Burkina Faso (Accra-Kumasi-Kintampo-Tamale-Bolgatanga-Navrongo-Paga-Burkina Faso); Burkina Faso to Niger (Ouagadougou-Koupèla-Fada N'Gourma-Kantchari-Niger, or Ouagadougou-Kaya-Dori-Niger, or Niamey-Makalondi-Burkina Faso); Burkina Faso to Togo/Ghana (Ouagadougou-Koupèla-Tenkodogo-Bitou-Togo/Ghana); and Togo to Burkina Faso (Lomé-Tsévié-Atakpamé-Sokodé-Kara-Sansanné Mango-Dapaong-Burkina Faso). The ECOWAS Commission initiated a study to prepare an infrastructure development master plan for 2015-2030. The draft report of the study proposes the priority road projects showed for a total investment of about US$10.8 billion; among others, these include Dakar-Bamako/Ouaga/Niamey highway, development with a 2x2 expressway of the Lomé-Ouagadougou road, highway construction on the Abidjan-Ouagadougou route, and development with a 2x2 expressway of the Tema-Ouagadougou road. Created in 1994, the West African Economic and Monetary Union (WAEMU) / Union Economique et Monétaire Ouest Africaine (UEMOA) is an organization of eight states of West Africa, including Burkina Faso, Cote d’Ivoire, Niger, and Togo, established to promote economic integration among countries that share a common currency, the CFA franc. WAEMU is a customs and monetary union between eight members of ECOWAS, which aims to create a common market and customs union, and coordinate macroeconomic, sector, and fiscal policies in order to achieve greater economic competitiveness. Ghana is not a member state of UEMOA but is surrounded by UEMOA countries and accepts the rationale for using the same standards regarding issues such as axle load regulation. WAEMU selected 11 priority routes as WAEMU Corridors at its Summit Meeting in 2009 (Decision N°39/2009/CM/ UEMOA). Thereafter, another corridor was subsequently added to connect Tema Port to the landlocked countries. WAEMU Corridors, which are international corridors, have been assigned the highest priority in the WAEMU road plans under PACITR, the Community Roads of UEMOA Infrastructure and Transport Action programme. The corridors include, among others, Corridor 1 connecting Abidjan to Ouagadougou; Corridor 5 connecting Lomé to Niamey via Cinkansé, Koupéla, and Kantchari; Corridor 6 connecting Lomé to Ouagadougou, and Corridor 12 connecting Tema to Ouagadougou.

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4. Transport and logistics characteristics of the corridors

Burkina Faso, similarly to its landlocked neighbor Niger, continues to rely on exports of a limited scope of (primarily) unprocessed commodities and minerals. It runs a significant trade imbalance with not only the rest of the world but also its immediate neighbors, with direct implications for its international transport and trade costs, given the need for transport prices on northbound (full) cargo flows to also compensate for the southbound (mostly empty) flows. The region’s trunk road infrastructure is mostly in fair-to-good condition, although large gaps remain on corridors such as the eastern link between Lomé and Niamey. Rural connecting roads remain in a poor condition nearly across the region, inhibiting last-mile access from agricultural areas to the main corridors. Many gaps remain on the “soft” aspects of transport and trade facilitation, including lingering freight sharing agreements that reduce the competitiveness of transport service provision, little use of direct contracting of trucking services, low level of professionalization of the overall trucking and logistics industry, and inefficiencies in border crossing and Customs processes. Trucking costs absorb most of the total corridor transport costs. Ouagadougou-Lomé is a cheaper corridor for Burkina Faso’s trade compared to Ouagadougou-Tema or Ouagadougou-Abidjan, largely due to the lower port cost and lower inland transport cost. While the Ouagainter inland clearance terminal has seen impressive cost and time reductions, only slight improvements on all corridors have been observed in the transport leg. In the port leg, Lomé saw significant time and cost reductions, in contrast to Tema or Abidjan. The Ouagadougou-Lomé corridor is Burkina Faso’s main external trade artery, accounting for about 40 percent of all cargo entering Burkina Faso. The Ouagadougou-Abidjan road and rail corridors account for another 30-35 percent, with the remainder represented by the Ouagadougou-Tema route. The latter corridor is of far greater importance for Ghana’s external and internal trade flows compared to Burkina Faso, serving as the main axis connecting Ghana’s northern regions to the more prosperous southern production areas and the port of Tema.

4.1. The corridors’ role in trade According to statistics collected by the Burkinabe Shippers Council (CBC), Burkina Faso imported about 3.1 million metric tons (mt) and exported about 450,000 mt of goods in 2015, including both regional and international cargo. Exports from Burkina Faso in 2015 were just 14.5 percent of the import volume, resulting in many trucks returning to the port empty. Burkina Faso has access to the sea through three main road corridors, connecting Ouagadougou to Abidjan, Lomé, and Tema, respectively. The largest individual share of cargoes enters Burkina Faso via the Ouagadougou-Lomé corridor (~40 percent), closely followed by the Ouagadougou-Abidjan corridor (approximately 30-35 percent), while the rest is shipped via the Ouagadougou-Tema route (UEMOA, 2017). The preferred corridors for export are Ouagadougou-Abidjan and Ouagadougou-Lomé (Saana Consulting, 2016), with over 55 percent of the exports traveling on the Ouagadougou-Abidjan corridor (JICA, 2018a). The Ouagadougou-Niamey link, part of the extended Niamey-Ouagadougou-Lomé corridor, connects the capital cities of Burkina Faso and Niger and, thus, serves their bilateral trade, as well as provides by far the most commonly used connection for Niger’s exports via the Port of Lomé. An alternative route from Lomé to Niamey circumvents Ouagadougou, instead, crossing the Togo-Burkina Faso border at Ponio and directly heading towards Niger across Burkina Faso’s East region. This route, albeit 150 km shorter than the Niamey-Ouagadougou-Lomé option, is currently unused. The subsequent sections of the study examine each of the above corridors in turn, separating between the links that serve Burkina Faso’s external trade from the links that provide Niger with access to Burkina Faso and, further, to the Port of Lomé.

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Burkina Faso’s corridors Ouagadougou – Tema The Ouagadougou-Tema corridor connects the port of Tema to Kumasi (Ghana), then further to the border posts at Paga (Ghana)/ Dakola (Burkina Faso), and, finally, to Ouagadougou (Figure 1). The corridor is an ECOWAS priority corridor (but not a WAEMU corridor), an intra-regional corridor connecting Ghana and Burkina Faso. Around 70 percent of inward transit traffic via the port of Tema is destined to the Burkina Faso market. Outward volumes from Burkina Faso to Tema are very low, although there is active cross-border trade between Burkina Faso and Ghana. Ouagadougou-Tema is also a gateway corridor for Ghana, connecting its inland regions to the coast. Tema handled 12.1 million mt in 2015 – less than Abidjan (21.4 million), Lomé (15.4 million) and Dakar (15.2 million) but above Conakry (Guinea) and Takoradi (Ghana) (UASID, 2017). Between 2010 and 2015, the volume of containerized cargo increased by almost 30 percent, to 6.26 million mt per year, while total import transit traffic flows through Tema increased from about 437,000 mt to almost 719,000 mt. Burkina Faso was the destination of most of the transit cargo flows, with import volumes more than doubling in 2010-2015, to 593,000 mt. Burkina Faso’s exports through Tema stood at just 3,000 mt in 2015, or a third of the level in 2010 (Toebes, 2017). Tema is expected to play an increasing role in the future. A Memorandum of Understanding was signed in 2014 to expand its capacity to 3.5 million twenty-foot equivalent unit (TEU) (USAID, 2017), thus exceeding the planned capacities of Abidjan and Lomé. The expansion would include four deep-water berths, dredging of the access channel, and a 6-lane Tema-Accra highway (World Bank, 2017b). The corridor section from Tema to Kumasi is the busiest route in Ghana in terms of cargo and passenger traffic; beyond Kumasi it remains the second busiest route. It is the only corridor that goes through the four most important cities of Ghana i.e. Tema, Accra, Kumasi, and Tamale. The corridor is mainly used for internal and regional trade: of all the cargo volumes, about 80-90 percent has a Ghanaian origin and destination, and just 10-20 percent cross the Ghana-Burkina Faso border (Saana Consulting, 2016). Trucks from Tema to the landlocked countries pass through the Paga border crossing. The commonly used “central corridor” route, passing along Kumasi and Tamale via the N10, takes less time than the shorter route via the ‘eastern road corridor’, as the road condition of the eastern corridor, which follows the N2 via Yendi, is poorer (Roche, 2014).

Ouagadougou – Lomé Ouagadougou-Lomé is an intra-regional corridor and a priority WAEMU corridor, with significant bilateral trade taking place between Togo and Burkina Faso, especially in clinker. The corridor has the advantage of a natural deep-water port, about 16.6 meters for the container berth, that allows berthing of large size vessels, while Tema and Abidjan must be regularly dredged (UEMOA, 2017). Lomé has a large hinterland area – it is used not only for the transport of local cargo but also as a transit port for a wide area in the East-West direction. The corridor offers road transport only; the old railway infrastructure is not operational, but the GoT is planning an extension of the railway to the border with Burkina Faso (USAID, 2017).

Lomé is the primary maritime gateway for Burkina Faso, and about 75 percent of the traffic on the corridor from Lomé goes to Ouagadougou (Saana Consulting, 2016). In 2016, 60 percent of Lomé’s traffic was from or to Togo, 22 percent to/from Burkina Faso, and slightly over 3 percent -- to or from Niger (USAID, 2017). The total volume of transit traffic transported on the corridor in 2016 was approximately 1.4 million mt. The Port of Lomé functions not only as an international trade hub but also as a base for trade and manufacturing, thanks to the large industrial free zone where dozens of businesses have set up operations. Therefore, its importance and that of the corridor is very high also from the perspective of Togo’s industrial development (JICA, 2018b). In recent years, a third wharf, a container terminal, and a new dock have been built, and a new fishing port has been constructed, which has improved the performance of the Port of Lomé. As a result, overall traffic has more than doubled in recent years, reaching 19 million mt in 2017, while the annual volume of containers handled increased to 1.2 million TEU (Republique Togolaise, 2018). The expansion of the new container terminal at Lomé has led to a rapid increase in the volume of transshipment cargo, reaching 15 million tons in 2015.

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Figure 1: Ouagadougou-Tema corridor

Source: Population data from World Pop (2014)

Land area within corridor

20-km buffer:

40,035 km2

Corridor buffer as share of

Ghana/Burkina Faso

combined land area:

7.82%

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Ouagadougou-Abidjan While not the focus of the current study, the Ouagadougou-Abidjan corridor – including a road corridor and a rail corridor – represents an important node linking Burkina Faso to global markets, via the Port of Abidjan. The corridor connects Abidjan to Yamoussoukro and Bouake (Cote d’Ivoire) and, further, to Bobo-Dioulasso and Ouagadougou (Burkina Faso) and serves as a gateway for Burkina Faso’s cotton exports, among other commodities. The corridor also serves the needs of Cote d’Ivoire’s internal trade – such as between the administrative capital Yamoussoukro, Bouake, and the northern agricultural region. Transit traffic represents only about 11 percent of the Port of Abidjan’s overall traffic, or 2.32 million mt in 2015. Burkina Faso is the destination of about 60 percent of the Port of Abidjan transit; on the flipside, the Port of Abidjan is the second most important gateway for Burkina Faso, after Lomé. Burkina Faso’s transit traffic through Abidjan grew by about 150 percent between 2010 and 2015, double the rate of transit traffic going through Abidjan to and from Mali (Saana Consulting, 2016).

Niger’s corridors Niamey – Ouagadougou The data available on the trade characteristics and flow volumes on this link is more limited. The corridor forms part of the Trans-Sahelian Highway from Dakar (Senegal) to N’Djamena (Chad) and connects the capitals of Burkina Faso and Niger, serving their bilateral trade and Niger’s transit trade traveling further down to the coast. The length of the corridor is about 522 km, with annual corridor transit traffic estimated at 540 mt in 2015. Trucks account for about a third of all vehicles traveling on this corridor (Saana Consulting, 2015a).

Niamey – Ouagadougou – Lomé In contrast to Burkina Faso that has several options for accessing the coast, for Niger the only feasible current options are the Niamey-Cotonou corridor and the Niamey-Ouagadougou-Lomé route. The latter corridor connects Niger to the Port of Lomé via Ouagadougou and Fada n’Gourma in Burkina Faso. It serves a nontrivial portion of Niger’s trade – carrying 15-20 percent of its import transit – even if the Cotonou-Niamey corridor is currently a much more commonly used route for accessing the coast (about 75 percent of Niger’s import transit). Transit between Niger and Togo dropped from close to 0.5 million tons at its peak in 2013 to less than 0.2 million tons in 2016 but has a potential to increase if road and border crossing conditions improve and given the better performance of the Lomé port compared to Cotonou.

Niamey – Lomé via Ponio and eastern Burkina Faso The eastern corridor connecting Niamey and Lomé circumvents Ouagadougou, instead going directly towards Niger from the Togo border across Burkina Faso’s East region. It is 200 km longer than the Niamey-Cotonou corridor and has two border crossings instead of one. On the other hand, this corridor is about 150 km shorter than the currently used route connecting Niamey to the Lomé (via Ouagadougou and Fada n’Gourma).

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Figure 2: Niamey-Ouagadougou-Lomé corridor

Source: Population data from World Pop (2014)

Land area within corridor

20-km buffer:

51,925 km2

Corridor buffer as share of

Togo/Burkina Faso/Niger

combined land area:

3.43%

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Figure 3: Niamey-Lomé eastern corridor

Source: Population data from World Pop (2014)

Land area within corridor

20-km buffer:

41,043 km2

Corridor buffer as share of

Burkina Faso/Togo/Niger

combined land area:

2.71%

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4.2. Trade composition and partners

In the last two decades, the region’s countries for the most part saw larger relative increase in trade with the rest of the world compared to the other countries in West Africa. As shown in Figures 4 and 5, Burkina Faso and Ghana recorded the largest increases in export value, while Togo saw by far the largest relative increase in import value, the 2017 level being more than ten times higher compared to 2000. However, little increase in either import or export values was recorded for Niger. Primary commodities, such as gold, bauxite, manganese, phosphate rock, cacao, cashew, palm oil, rubber and cotton, represent most of the region’s exports in value terms. In Burkina Faso, the latest most important structural change in the economy has been the growth of the mining sector. Mining’s contribution to GDP tripled, from 3 percent in 2009 to 9 percent in 2016, while its share of exports increased from 43 percent to 69 percent.

Figure 4: Export value index (Year 2000 = 1)

Figure 5: Import value index (Year 2000 = 1)

Source: Center for International Development, Harvard University

According to UN COMTRADE (2017) most of Burkina Faso’s total export value of US$2.79 billion is composed of precious and semi-precious stones and metals (US$1.79 billion, or 64 percent of the total), cotton (US$368 million, 13 percent), fruit and nuts (US$171 million), zinc (US$163 million), and oil seeds (US$135 million). Oil seeds also represent Burkina Faso’s main export commodity by weight, exceeding 384,000 mt. Cotton and zinc, respectively, are the second and third most

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important export commodities in tonnage terms, at about 226,000 mt and 177,000 mt. The other commodities follow more distantly, including cereals, mineral fuels, and food preparations. Export of phosphates has decreased since 2010, mainly due to a decrease in exploration capacity. The largest import commodities, by value, are mineral fuels and oils (US$926 million, or 25 percent of total import value in 2017), machinery (US$468 million, 13 percent), electrical equipment (US$317 million), and vehicles (US$310 million). Cereals represent the most important agricultural imports, at US$146 million, or 4 percent of the total. By weight, cement is the most important import commodity, with 1.682 million mt, followed by petroleum oils (1.272 million mt). Rice represents the most important food commodity by weight, at 435,000 mt. Partly reflecting Burkina Faso’s commodity trade profile, also at the Port of Lomé the most important commodity by volume is clinker, accounting for 28 percent of the total volume handled. It also represents the largest share of the freight, by weight, transported on the Ouagadougou-Lomé corridor (JICA, 2018b).

Figure 6: Burkina Faso’s trade partners, by value (percent) in 2017

Source: Center for International Development, Harvard University

As shown in Figure 6, African countries are the origin of nearly half of Burkina Faso’s imports, totaling US$1.51 billion in 2017, while their role as Burkinabe export destinations is much smaller, at less than 5 percent of total export value (US$70.8 million). In addition to Egypt, South Africa, and Senegal, Burkina Faso’s neighbors are its main trade partners within Africa. Considering the corridors in scope of this study, the value of trade between the Ouagadougou-Tema corridor countries quite significantly exceeds that between the countries connected by Ouagadougou-Lomé or the Ouagadougou-Niamey routes.

▪ According to COMTRADE, Burkina Faso’s exports (2017) to Ghana totaled US$44.3 million, while imports were US$177.9 million. Exports mostly consist of oil seeds (37,000 mt, or US$13.8 million). Agricultural goods – nuts, tomatoes, and ground nuts – also represent key export commodities by weight. Petroleum oils represent the main import from Ghana, at 129,500 mt and US$85.8 million. Clinker is the second main import by weight (70,000 mt). Wheat flour is the main agricultural import from Ghana, with 22,500 mt, or US$7.9 million.

▪ Burkina Faso’s trade with Niger is much smaller and less imbalanced than with Ghana,8 although imports still

dominate exports: in 2017 it exported goods worth US$19.4 million to Niger but imported US$27.4 million. Cereals (maize and millet) represent by far the main export commodity in both value and tonnage terms, at US$11.1 million and 53,000 mt, respectively. Mineral fuels represented nearly all of Burkina Faso’s imports from Niger in value terms, at US$26.64 million. By weight, a significant volume of imports is represented by onions – about 2,300 mt – however, the associated import value is quite low, only US$132,000.

8 This can be at least partly explained by Niger’s less diversified production profile compared to Ghana’s and its reliance on exports of petroleum, uranium, and gold rather than consumer goods or agricultural products.

0

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Egypt: 39.24% Ghana: 20.31%

Cote d’Ivoire: 15.67% Togo: 10.43% Mali: 6.91%

Cote d’Ivoire: 35.35%

Ghana: 32.41% Togo: 8.41% Mali: 7.71%

S-Africa: 3.81% Senegal: 3.78%

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▪ Burkina Faso exported US$32.5 million worth of goods to Togo in 2017 and imported US$122.5 million. Oil seeds are the main export commodity, at US$19.4 million, followed by nuts (US$10 million). Oil seeds and ground nuts account for the largest share of export tonnage, at 38,400 mt and 12,100 mt, respectively. Cement clinker represents the main import commodity from Togo to Burkina Faso, at about US$85 million and total net weight of 872,000 mt.

According to a traffic study undertaken by JICA in 2015 (JICA, 2018a), significant traffic in the two coastal countries – Ghana and Togo – takes place on the roads in the East-West direction and on arterial roads between port cities and central areas. Annual average daily traffic between Accra and Kumasi and between Lomé and Tsévié is approx. 10,000 and 5,000 vehicles/day, respectively. The traffic on roads north of these sections is smaller, with maximum 3,500 vehicles/day. The volumes of the North-South cross-border traffic between Ghana and Burkina Faso and between Togo and Burkina Faso are just 465 and 746 veh./day, respectively. The average East-West traffic between Ghana and Togo is 6,000 veh./day (nearly all passenger traffic). Although the proportion of freight vehicles in the East-West cross-border traffic is very small, the absolute number of trucks is approximately the same as in the North-South cross-border traffic. Compared to an earlier study conducted in 2012, the 2015 JICA traffic survey found that traffic on the Ghana-Burkina Faso border (Paga) had grown by 90 percent, and on Togo-Burkina Faso border (Cinkasse) by 25 percent. Container traffic on the Ghana-Burkina Faso border saw an increase from 17 per day in 2012 to 56 in 2015. On the border of Burkina Faso with Togo, container traffic decreased from 48 to 39 per day. The DANIDA project Accelerating Trade in West Africa, completed in 2016, observed that the share of containers at the Ouagainter (Dry Port) had fallen from 32 percent of total cargo in 2012 to 24 percent in 2014. This trend suggests that although containerized cargo is increasing, its growth is outpaced by the growth of cargo transported by bulk and break-bulk (JICA, 2018a).

4.3. Corridor infrastructure condition and soft gaps

4.3.1. Infrastructure gaps

Road development at the sub-regional level has focused on the upgrading of existing roads. Most international arterial roads have been improved with the support of development partners. However, some road sections remain deteriorated and poorly maintained, such as along the corridors in inland areas of the coastal countries and in cross-border areas (JICA, 2018a). Road linkages between the countries in the East-West direction in inland areas remain under-developed as well. This section summarizes the road infrastructure condition in the study region, with a more detailed description available in Annex 1. There has been progress in terms of improving the corridors connecting Burkina Faso to coastal areas; however, some sections still need reinforcement. As shown in Figure 7, which illustrates the known condition of roads in Burkina Faso, most sections of the Ouagadougou-Tema and Ouagadougou-Lomé axes are in good condition; however, main roads in the eastern part of the country, including parts of the Niamey-Lomé and the Niamey-Ouagadougou routes, are in poor condition. Besides remaining gaps in the road network quality, transport and trade costs for Burkina Faso’s producers and consumers are amplified by several factors which increase the delays of trucks crossing the Burkina Faso border. These include, among others, the lack of Customs interconnection with the coastal countries, the need to wait for a “Customs escort” on the Burkina side, weak internet connectivity and a limited number of computers affecting access to the UNCTAD Automated System for Customs Data (ASYCUDA), different working hours of Burkina Customs and those of the coastal countries. The Paga–Dakola One-Stop Border Post (OSBP) (Burkina Faso/Ghana) and Kantchari OSBP (Burkina Faso/Niger) are some of the infrastructure projects proposed to be completed in the short term. The Ouagadougou-Tema corridor has undergone sectional improvement works involving periodic upgrading as well as rehabilitation and reconstruction under various infrastructure development programs, such as the Transport Sector Programs 2008-2012 and 2013-2017 (USAID, 2017). In 2008, about 82 percent of the corridor was in good or fair condition (West Africa Trade Hub, 2010), and between 2008 and 2016, the road conditions along several parts of the corridor was improved, such as between Accra and Kumasi, Buipe and Tamale, and Dakola and Ouagadougou. With Tema Port’s expansion, it is also planned to upgrade the stretch between Tema Port and Accra (Saana Consulting, 2016). According to the most recent

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available data, 959 km of the Tema-Ouagadougou corridor length is in fair to good condition, while 98 km are in poor condition. About 80 km of the Accra-Kumasi section has been dualized, while the rest of the section is a 2-lane single carriageway. The Kumasi-Paga section is a 2-lane carriageway in fair to good condition, while the road from Dakola (border) to Ouagadougou is in fair to good condition (USAID, 2017).

Figure 7: Current known road condition in Burkina Faso

Source: Ministry of Infrastructure, JICA, consultants

Ghana’s infrastructure priorities in the short term include completion of the Boankra Dry Port in the Ashanti region and the Paga OSBP (Ghana-Burkina Faso border), among others. The Dry Port, to be connected by railway to the primary ports, would serve not only Kumasi but also the landlocked countries further north, contribute to the reduction of congestion at Takoradi and Tema, and promote the establishment of export zones and associated employment opportunities in its vicinity. However, its full utilization will depend on the ability to deliver the railway line connection to the ports of Tema and Takoradi. The Yapei and Buipe Bridges, built in the 1960s in the Northern Region of Ghana, have seriously deteriorated and require rehabilitation (JICA, 2018a). The Ouagadougou-Lomé corridor is generally constructed to 2-lane paved standard except for the last 30 km near Lomé, which is constructed to 4-lanes highway standard. Out of the 652 km from Lomé to the Burkina Faso border, 15 percent is in poor condition, 27 percent in fair and 58 percent in good condition. The sections in fair condition were completed about 15 years ago, while the sections in good condition were improved recently (USAID, 2017). The access road to the port of Lomé area was drastically improved during the last few years. The frontage road of the port area in the East-West direction was elevated, and the outer ring road was upgraded to a 4-lane road which can directly access N1 as the international corridor to Burkina Faso (JICA, 2018b). Several different trunk road improvement projects were undertaken in recent years, focusing on the rehabilitation of 150 km of the RN1 section from Atakpamé to Blitta to Aouda. Most of the Lomé-Ouagadougou corridor in Burkina Faso’s territory is in good and fair condition, while the eastern section towards Niger is damaged. While most of the corridor in Togo has been rehabilitated, there are sections in poor condition, congested areas around the port and urban centers due to trucks parked along the road, and road safety hazards. Roads in Togo in the east-west direction have neither been paved nor maintained. Other hard infrastructure gaps include the lack of maintenance of several of the old and long-span bridges, such as across Kara River. In the Port of Lomé, the fishing port is being moved to a separate area and non-essential functions removed from the port to free up space for cargo. The Port is also seeking to

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use ICT programs to expedite handing at the port. Certain operators at Lomé are already able to move cargo from the port in 2-3 days, which meets international standards (USAID, 2017). In Niger, most of the major corridor sections, such as the Niamey-Burkina Faso border route, are in poor to fair condition, except for some sections near the Nigeria border which are in good condition. Nearly all of the unpaved road network in Niger is in poor condition. Across the region, intermodal terminals are needed that could serve as platforms for more advanced logistics operations. Rest areas strategically situated along the three corridors to serve the needs of truck drivers and thus promote traffic safety are also absent; the exception is the Ouagadougou-Lomé corridor which installed rest facilities although interviewed drivers complain about the locations of some of them (JICA, 2018a). Interviews conducted by USAID (2017) indicate that when the warehouses at destination are full, trucks are often delayed in the port city until warehousing or inland Customs clearance facility become available. Essentially, trucks are used as storage in the port city, reducing their number of trips per month and negatively affecting transport prices. There are several proposals for expanding the dry ports or inland container depots (ICDs) at important junctions, such as at Bobo Dioulasso and Ouagadougou. The Bobo-Dioulasso dry port in Burkina Faso, adjacent to the railway, is used by trucks crossing national borders and for combining rail and truck transport. Cargo volumes using the dry port have increased rapidly since 2010 (JICA, 2018b). Ghana has built a dry port, Boankra, near Kumasi; however, its operationalization has been delayed until the railway rehabilitation is completed (USAID, 2017).

4.3.2. Soft gaps

The above transport infrastructure gaps notwithstanding, the main factors causing poor performance on the corridors tend to be operational and regulatory. Effective corridor operations involve cooperation of many government agencies, such as Ministries (transport, works, trade and industry), border agencies and police, as well as corridor users, such as transporters, freight forwarders, manufacturers and agro-processors. Based on the existing trade volumes, the status of the corridor infrastructure, the impact on landlocked countries and previous experience with corridors institutions, the Ouagadougou-Lomé and Ouagadougou-Tema were identified by USAID (2017) as being in the priority group of ECOWAS corridors in terms of the potential and need of developing corridor-level institutions (Corridor Management Committees, or CMCs). Some of their main objectives would include joint monitoring to reduce road blocks, continued sensitization of the private sector to the procedures being introduced at joint border posts, sensitization on axle load control procedures, and integration of Customs procedures in the national single window. National Road Transport and Transit Facilitation Committees (NRTTFCs), a pre-requisite for functional CMCs to be put in place on the Ouagadougou-Lomé and Ouagadougou-Tema corridors, do formally exist in Burkina Faso, Togo, Niger, and Ghana. International and domestic trucking in the region remains characterized by aging trucks and own-account transport. In Burkina Faso, among the artisanal transporters, approximately 27 percent operate vehicles over 20 years old. The average age of trucks in Togo is 17 years, and the average number of trips per year undertaken by each truck on the Ouagadougou-Lomé corridor is only 3.5. In Burkina Faso, access to freight by transport companies remains dominated by intermediaries (ENSEA, 2014). There is asymmetry of information between trucking operators and traders and their representatives, leading to some rent extraction. It is important to promote long-term relationships between shippers and logistics providers, which requires a continuum of interventions – freight exchanges and more focus on contractual relationships. The legal framework for transport professions is currently lacking, notably regarding the regulation of drivers and freight companies. The quality and efficiency of freight services is thus poor, which in turn prompts the largest shippers to invest in their own truck fleets to satisfy their transport demand. While legislation describing the transport profession and the criteria for accessing it exists in Burkina Faso9 and is being developed in Togo under a World Bank project, implementation remains a challenge and existing operators require training and access to finance to adapt to higher standards. Niger is yet to develop such legislation.

9 Decree 683 of 2014 established the categories of road transport and the conditions for exercising the profession of transport operator.

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ECOWAS and the member states have developed many legal instruments and regulations to govern transport operations, yet many have not yet been implemented. One is the agreement that vehicles be checked at only three points on a transit route: the point of origin, border control, and destination. Togo has mostly achieved this on its North-South route. Burkina Faso had achieved it for a short time, but then the intermittent illegal stopping resumed (USAID, 2017). ENSEA (2014) reported there to be on average 9 checkpoints on the Ouagadougou-Niamey corridor and about 4.6 on the Ouagadougou-Lomé route. On the Ouagadougou-Tema corridor, there were 18 Ghanaian control points alone (in 2015) (UEMOA, 2016). Ghana’s new Government has announced an ambitious plan to remove all redundant controls along the corridors. It is highly unlikely that this deadline will be honored; yet, it indicates an appetite for reform (World Bank, 2018). The office of the Vice President of Ghana has been actively pushing the reform agenda in three major areas on the Ouagadougou-Tema corridor, namely the removal of unnecessary controls on the corridor; establishment of joint inspection points at the Port of Tema; and migration to a single, paperless trading environment. Cote d’Ivoire, Ghana, and Togo have introduced Global Positioning System (GPS) tools to track the movement of trucks in their respective territories, allowing truck drivers to move without depending on the schedule of an escort team. However, Burkina Faso has yet to adopt this system and is still employing the old system of a Customs escort. A common use of GPS tracking from port to Ouagainter, which does not need to be offloaded at the border, would simplify the process (paying to a single GPS provider) and remove the escort system which slows down cargo movement. In Togo, the convoy service Solidarity sur la Mer was abolished a few years ago but it still invoiced for, and a Bordereau de Suivi for transit goods has been introduced (Saana Consulting, 2016). Ghana has made significant progress in simplifying its trade procedures, through its GNet system operating in the main ports and the application of GPS in tracking truck movement on the main international transit corridor (Ouagadougou-Tema).

Box 2: World Bank supported reforms in Burkina Faso and Cote d’Ivoire

Several bi-lateral reforms were supported by the regional World Bank-financed Development Policy Operation, affecting the efficiency of transport and trade flows on the Ouagadougou-Abidjan corridor. As noted in World Bank (2016), the design of the Regional Trade Facilitation and Competitiveness Development Policy Credit (RTFCC) series was informed by lessons learned from previous operations in the transport sector in West Africa. Among the main lessons learned is that transport and trade facilitation are multifaceted and politically complex reforms that require to address reforms in complementary areas and to ensure strong coordination at the national and regional level. The RTFCC was designed to consider this by (a) adopting a corridor approach and coordinating transport and customs-related reforms and (b) offering a framework for dialogue and coordination between public and private stakeholders within each of the two countries and between them. The first operation in the series was approved in June 2015, while the second project in the series was approved in late 2016 and closed at the end of 2017. The operations led to the adoption of new regulatory provisions on the liberalization of freight in Burkina Faso, with groups of Burkinabe shippers starting to procure transport services through competitive tenders. Efforts by the Burkinabe Shippers’ Council (CBC) to raise awareness among transporters and traders about the rolling out of the virtual freight exchange reportedly led to an increased interest from operators wishing to register on the platform to facilitate matches between supply and demand for transport services, although by December 2017 only 25 Burkinabe transporters and 35 shippers had registered on the virtual exchange. The agreement between the Burkinabe and Ivorian Chambers of Commerce and Customs administrations enabled the single payment of the transit guarantee at the point of departure for cargo transported on the Abidjan-Ouagadougou corridor under the Interstate Road Transit (ISRT) regime, effectively suppressing the need for another procedure at the inland border in Burkina Faso. There are some indications received from the Côte d’Ivoire Customs that the average transit time has fallen to around 4 days, in line with the expected result of the two operations. The Burkinabe Customs started the implementation of automated selectivity in May 2016, which was expected to reduce the proportion of cargo routed to the red channel to 20 percent. However, while the time required to clear Customs did drop significantly, from 12.7 hours in 2015 to 7.7 hours in 2017, it does not appear that the system of risk-based selection is working, as the proportion of transactions routed through the Customs’ red channel has increased (World Bank, 2018). The currently ongoing PAMOSET (Projet de Modernisation du Secteur des transports et facilitation du commerce sur le Corridor Abidjan-Ouagadougou) operation, also financed by the World Bank, is providing further support to the implementation of the reforms proposed in RTFCC1 and RTFCC2.

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Remaining soft gaps on the corridor include the need to remove redundant controls, simplify the scanning process, introduce risk management, and eliminate the unnecessary need for hard copies of trade documentation, increase cooperation between border agencies, remove redundant security agencies, and establish an effective public-private dialogue between port stakeholders. Border post performance is fair to poor at Paga, because transit goods entering Ghana must have a Customs escort to Tema. The Inter-State Road Transit (ISRT) transit regime has not been used as intended to reduce time and cost for transit traffic. Instead, countries generally require it to be filled at each border (USAID, 2017). The ECOWAS protocol on Inter-State Road Transit of Goods (ISTG) – the envisioned single guarantee fee of 0.5 percent to be paid at the port for imports and a mechanism to split the fee between the coastal country (entry point) and the land-locked country (destination) – is still not completely realized. No progress is reported at the Ouagadougou-Tema corridor (JICA, 2018b). The road transport sector in the four countries crossed by the corridors in scope of the study is still fragmented and lacks competitiveness. The 1/3-2/3 (coastal/landlocked country carriers) freight sharing rule is still implemented for large shipments of rice and containerized goods on the Ouagadougou-Lomé corridor (Saana Consulting, 2015b). Freight allocation through “truck queuing” in Lomé applies to most of the large shipments, to containers and to some smaller shipments, but other freight allocation is market-mediated. Overall, truck queuing is enforced about 30 percent of the time. Many ECOWAS countries are developing single window applications so that all border documentation can be submitted electronically to a single-entry point. ECOWAS has established a Liberalized Trade Regime, making intra-regional trade exempt for Customs duties. It has not been as widely used as anticipated because of the need to prove that goods were produced in the region or have a certain standard of value added within the region (USAID, 2017). Customs in the study region still focus on revenue collection and therefore multiply layers of controls that increase the duration of the clearance of the goods, even for compliant traders. Introducing ratings for traders and clearing and forwarding agents to monitor their compliance would enable Customs to focus on potential frauds while reducing the burden of controls for compliant operators, opening the way for trusted traders’ programs benefitting from green channels. Procedures could be further accelerated through automation, as the Single Window in Togo proved its efficiency in reducing Customs clearance times. The Cinkasse OSBP, which trucks traveling on the Lomé-Ouagadougou corridor must pass, is congested, and the long delays may result in a waiting time at the border of 1 or 2 days (JICA, 2018b). The main functions of the Cinkasse OSBP, which are to facilitate Customs clearance, have not yet started due to lack of: a bilateral agreement simplifying Customs clearance for transit cargoes to avoid double clearance of cargoes at Lomé Port and the Cinkasse OSBP border post, a bilateral agreement to avoid double charges for transit cargoes, a bilateral agreement to exchange information on transit cargoes between the two countries, and a Burkinabe Customs office at Cinkasse OSBP (instead, it is located at Bittou). Another issue is the charge for using the OSBP levied by the operator (FCFA 50,000, or US$85 per vehicle). There is no enforcement of regulations on oversized vehicles, which cannot be scanned by the container scanner. Ouagainter in 2016 launched SYLVIE, a single point of entry for documents required for pre-clearance. At Lomé Port, the chambers of commerce of Togo and Burkina Faso signed an MOU in late 2015 to allow the two Customs bounds fees to be charged once at Lomé port, however, this has not yet been implemented (JICA, 2018a). The expectation is that the time it takes to go through the Customs pre-clearance process will be reduced from 15 days to 3 days, and the number of documents required for importing and exporting will be reduced from 10 to 7 and from 10 to 3, respectively (JICA, 2018b). The regional efforts to prevent overloading by complying with the WAEMU Regulation 14 will continue to have limited success in the absence of professionalization of the trucking industry. Axle load control is enforced on the Ouagadougou-Lomé corridor, and overloaded trucks are required to offload the excess load. Penalties, however, are not imposed. The recent expansion of the Tema container terminal is expected to open opportunities for logistics services companies to operate in and around the port as well as along the corridor and to provide door-to-door services. However, the logistics services sector must be carefully regulated and monitored to avoid uncompetitive practices, rent-seeking activities and collusion. For example, the provision of stevedoring services in the bulk and general cargo terminal in the Tema port is currently uncompetitive and lacks transparency. Similarly, analyses carried out on the functioning and operations of the Port of Lomé have revealed weaknesses whose resolution would make the port more efficient and competitive, for example, limited development of value-added logistics services in addition to the sub-optimal flow pattern leading to chronic congestion and the sub-optimal land use and development in the inner port area. While the new Lomé Container Terminal and the third

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container berth have drastically increased the port’s throughput, the competitiveness of both Lomé and Tema remains low due to the high cost and complex procedures of trade. The handling performance of cranes in the two ports is 10-20 moves per hour, compared to a global standard of around 30 moves per hour (JICA, 2018a). One of the reasons for delays at both Lomé and Tema is the practice of de-stuffing and loading of containers as break bulk. The problem of timely return of containers when they are carried to inland destinations has caused the shipping lines to charge heavy deposits and impose late fees on the containers. This practice discourages road transporters from taking containers inland. Moreover, without specialized container trailers, much of the time advantage of using containers is lost (USAID, 2017). Table 1 shows the 2018 Logistics Performance Index (LPI) ranking of the four countries. Overall, Burkina Faso ranks highest, followed by Ghana and Togo. Burkina Faso’s lowest ranking is in terms of tracking and tracing, while its performance in international shipments is assessed as very good, ranking 60th in the world. Across the study area there is a need to better link potential major freight generators and attractors to the main corridors (trunk roads and railways) and to establish logistics platforms at strategic locations to link different transport modes that would allow cargo consolidation and its seamless transfer from one mode to another (JICA, 2018a).

Table 1: Logistics Performance Index 2018 ranking of countries concerned compared to neighbors

Burkina

Faso Ghana Niger Togo Benin

Cote d’Ivoire

Liberia Mali Nigeria

LPI rank 91 106 157 118 76 50 143 96 110

Customs 100 92 157 119 82 51 152 133 147

Infrastructure 95 90 142 116 83 56 149 109 78

International Shipments

60 109 158 111 83 45 155 88 110

Logistics Competence

106 95 150 134 98 37 148 107 112

Tracking & Tracing

124 106 141 120 87 49 155 54 92

Timeliness 95 115 155 112 57 71 69 119 92

Source: Logistics Performance Index based on a World Bank survey, 2018

4.4. Transport costs on the corridors Transport and logistics costs are directly or indirectly paid by the shipper or consignee (the importer or exporter of goods), composed of:

▪ Gateway costs: clearing and forwarding, shipping agent fees, cargo handling, port authority dues, other government agency fees (e.g. shippers’ councils), and truck loading (applies only for stripped containers);

▪ Inland transport costs: trucking services and the fees to intermediaries; and ▪ Inland processing costs: border clearance costs, Customs clearance, fees associated with ICDs.

The inland transport costs tend to be by far the largest component of the costs. The components of the logistics chain that make transport by bulk cheaper as compared to containers are the lower inland transport fee (per ton), no stevedoring/ handling charge (unlike a container that has to be lifted on and lifted off), and lower Customs clearance cost (per ton) (JICA, 2018a). Administrative procedures for goods in transit and the inadequacy of key ancillary services are major factors that determine the cost and performance of transport corridors (Arvis et al., 2011). For the movement of goods, border crossing issues and cargo transport-sharing arrangements on some corridors result in additional charges. West Africa’s landlocked countries suffer from particularly high cost (to shippers) of road transport for a variety of reasons, including long haulage distances to ports, sections of road networks in poor condition, old and poorly maintained trucks, poorly maintained transport facilities, trade imbalances causing limited backhauls and cumbersome government regulations (Van Dyck and Domfeh, 2017). Perhaps the main factor increasing the logistics costs on the region’s main corridors is the

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process of transit transport price determination without effective competition (except in Ghana) (Nathan Associates, 2013; USAID/West Africa Trade Hub, 2012). Export is generally less expensive and faster than import, due to the much larger volume of goods coming in the countries than going out. All main corridors serving Burkina Faso have seen transport cost reductions, although the evidence in terms of the total transport and logistics time is more mixed. The average corridor costs have gone down by 16 percent and average corridor times by 6 percent over the last 4 to 8 years (Saana Consulting, 2016).

4.4.1. Imports

Trucking costs absorb over 60 percent of the total corridor transport costs for imports into Burkina Faso; ports represent another 20 percent, while border crossings and clearance at the inland terminal account for about 15 percent. The structure of the average transport price per ton varies by route and by type of good. From Lomé to Ouagadougou, the transport of clinker costs 36,000 FCFA (US$62) per ton, other goods -- 38,000 FCFA (US$65). Cement prices are fixed by the State, and cement manufacturers pass their constraints on to transporters. Transit transport prices from ports to Burkina Faso are largely set by the Burkina Faso Road Transporters Organization, OTRAF (Saana Consulting, 2016). The actual costs for import vary around the OTRAF reference, as a function of supply and demand. The rates of the larger companies are constant for several years, as these companies determine their own rates. The larger and formal transport companies charge higher prices to transport a container although the contract is sometimes subsequently sold, for a smaller amount, to the small transport companies. The average price of the transport leg (excluding port or border crossing costs) of a 20-ft container from Tema to Ouagainter is about US$2,600, while the price for transporting of a 20-ft container from Lomé to Ouagainter is about US$2,000. It costs about US$2,500, on average, to transport a 20-ft container from Abidjan to Ouagainter by road, while transport by rail costs only about US$1,300 (Toebes, 2017). According to other recent studies, on a one-way (return empty) trip between Lomé and Ouagadougou or Tema and Ouagadougou, the transport of a 20-foot container is charged between US$1,970 (Saana Consulting, 2016) and US$2,247 (UEMOA, 2017).

Figure 8: Cost components for import of a 20 ft container to Burkina Faso, by corridor

Tema-Ouagadougou Lomé-Ouagadougou

Source: Saana Consulting (2016)

Of these amounts, various informal payments represent a modest 0.7-1.2 percent and 3-3.8 percent on the Lomé and the Tema corridors, respectively (UEMOA, 2017; JICA, 2018b). ENSEA (2014) reported the total informal payments on the Ouagadougou-Tema corridor (both at checkpoints and other) to amount to 56,420 FCFA, or US$97, compared to US$58 on the Niamey-Ouagadougou and the Ouagadougou-Lomé corridors. While the GoT has made efforts in reducing road blocks, formal but arbitrary payments remain a serious issue at Cinkasse. On the Ouagadougou-Lomé corridor, the fee charged by clearing agents to process documents at Cinkasse (US$164 Togo side + US$25 informal fee; US$68 Burkina Faso side) represents about 7 percent of the total corridor cost. This is higher than on the Ouagadougou-Tema corridor (JICA, 2018b).

16%

66%

18%

19%

60%

21%

28

JICA conducted a Logistics Chain Survey from August to October 2016 (JICA, 2018a) on the Tema-Ouagadougou and Lomé-Ouagadougou road corridors and on the Abidjan-Ouagadougou road and rail corridors. It found that the cheapest corridor to use for import of transit cargo (40-ft containers) is Lomé-Ouagadougou, at a total cost of US$4,214, compared to US$4,590 on the Tema-Ouagadougou corridor and US$5,531 on the Abidjan-Ouagadougou road corridor. This is largely due to lower port cost (stevedoring, terminal handling fee, and shipping line fee) and lower inland transport cost. The same was found to be the case for bulk-cargo (40-ft container stripped at the port): the cheapest corridor to bring in cargoes from a port to Ouagadougou is Lomé-Ouagadougou (US$3,393 compared to US$3,591 on Tema-Ouagadougou), again largely due to lower port cost. The overall Tema-Ouagadougou corridor costs for import decreased by 12 percent and overall time by 10 percent in 2008- 2016. The port and transport legs have seen only slight improvements, while the Ouagainter terminal in Ouagadougou saw a 38-percent and 30-percent reduction in cost and time, respectively (Saana Consulting, 2016). The total transport and logistics cost of importing a 20-foot container on the Lomé-Ouagadougou corridor went down from US$4,092 in 2010 to US$3,441 in 2016, a reduction of 16 percent. The biggest improvements were at the border crossing and in the clearance procedures in Ouagainter. Similarly, the costs of port procedures decreased by 27 percent. The costs for road transport however, did not show any improvement, increasing, on average, by 1 percent (Toebes, 2017). In 2016, the total time required to import a container on the Tema-Ouagadougou corridor was 9.5-16.4 days. The time at the port was 4.6-8.5 days; the time spent on the road 3.8-4.6 days; and the time spent at the border 1.4-3.2 days (Saana Consulting, 2016). Unlike overall cost, the overall time on the Lomé-Ouagadougou corridor has increased, which is attributed to inefficiencies at the Cinkasse border crossing and teething problems with the Single Window in the Port. The Cinkasse OSBP is occasionally very congested, resulting in a wait time of 1 to 2 days. However, also the transport time has slightly increased (Saana Consulting, 2016; Toebes, 2017).10 Delays at control points are higher on the Lomé-Ouagadougou corridor compared to Tema-Ouagadougou, at about 5 hours compared to less than 2 hours (UEMOA, 2017). A round trip of a truck bringing imports from Abidjan to Ouagadougou via the road corridor was estimated to take 15.5 days in 2016, down from 18 days in 2012.The road transport option on the corridor is faster than rail, with a difference of nearly 5 days for a roundtrip (Saana Consulting, 2016).

4.4.2. Exports

The price of the transport leg of a 20-ft container from Ouagadougou to Lomé is very comparable to the Ghanaian price, at about US$1,050 (Toebes, 2017). Nevertheless, for Burkina Faso’s export cargoes the Ouagadougou-Lomé is the cheapest corridor to use overall. Ouagadougou-Tema is particularly affected by the high cost of various fees imposed on export cargo (certification, shippers council, etc.), plus the US$200 transit fee for transit cargo imposed by Customs and collected at the border. Other corridors do not have this additional cost (JICA, 2018a; JICA, 2018b, both citing a 2016 survey). The overall transport costs for export are substantially lower than for import and have seen a significant decrease over the last decade. For export, overall corridor costs on Ouagadougou-Tema decreased by 30 percent between 2008 and 2016, and corridor time – by almost 25 percent. The transport leg showed the biggest improvement with a reduction in cost of 46 percent. In 2008 and 2016, the road transport costs for exports on the Ouagadougou-Tema corridor were respectively 28 percent and 60 percent lower compared to the road transport costs for import. This considerable difference can be explained by the import volumes of Burkina Faso that are approximately ten times larger than export volumes (Saana Consulting, 2016) and by the lower taxes on export cargo (West Africa Trade Hub, 2013). In contrast to import, in the case of export the total transport and logistic costs of containerized cargo are higher than the costs of exporting break-bulk cargo. This is because only shipping lines can export containers, and their services are costlier than those of companies exporting break-bulk (West Africa Trade Hub, 2013).

10 The increase in transport time is likely due to inefficiencies on the Burkina Faso side. As reported by Republique Togolaise (2018), significant

progress was made between 2012 and 2016 in the level of service on RN1 (Lomé-Cinkasse), resulting in a reduction in the average travel time along the RN1 from 3 to 2 days.

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In 2016, the total time required to export a container from Ouagadougou to Tema was 2.5-4.8 days (about a third of the time required for import). The time at the port was about 0.8-1.6 days; the time spent on the road 1.9-2.5 days; and the time spent at the border 0.9-1.6 days (Saana Consulting, 2016).

Figure 9: Cost components for export of a 20 ft container from Burkina Faso, by corridor

Ouagadougou-Tema Ouagadougou-Lomé

Source: JICA (2018a), based on a 2016 survey

5. The corridors’ socioeconomic characteristics and economic potential

The Ouagadougou-Lomé corridor immediate vicinity – defined as the 20-km buffer area (radius) around the road - represents a significant generator of economic activity for both Burkina Faso and Togo and concentrates an important share of the two countries’ populations. Similarly, the extended Niamey-Ouagadougou-Lomé corridor is of major economic importance for Niger, despite the short length of the corridor in its territory. The Ouagadougou-Tema corridor buffer area concentrates a larger share of Ghana’s population compared to Burkina Faso’s; in terms of the concentration of economic activity, the corridor’s buffer area is of comparable importance to both countries. Finally, the eastern route of the Niamey-Lomé corridor in Burkina Faso’s territory remains sparsely traveled and populated, with little economic activity generated in its direct vicinity and much higher poverty incidence compared to the country’s average. In contrast, the portion of the corridor located in Niger’s territory accounts for a major share of that country’s GDP and population and is characterized by much lower poverty incidence than in Niger overall. Economic potential at the sub-national level can be characterized along several dimensions and can serve as a lens for designing rural and urban development strategies and prioritizing corridor investments and complementary policies; economic lagginess and the need for “linking in” represent another key lens. While Ghana’s regions, nearly across the board, have higher current agricultural production levels and potential production levels than the regions of Burkina Faso, Togo, or Niger, significant untapped production potential exists in the entire study area. Among Burkina Faso’ sub-national regions crossed by the corridors in scope, current agricultural production and assessed potential production is highest in the Center-East located on the Ouagadougou-Lomé route, where currently about 560,000 mt of agricultural crops worth US$157 million are produced annually, with the potential to reach 940,000 mt (US$237 million).11 When also considering manufacturing and agglomeration potential indicators, different sub-national regions emerge as having most potential depending on the angle of potential considered. The overall pattern suggests

11 Monetary value of production calculated by IFPRI using past average international prices.

32%

47%

21%

28%

52%

20%

30

greater economic potential in Ghana (except its Northern region) and Togo, the western regions of Burkina Faso, and individual regions in Niger that border Nigeria. In Burkina Faso, the Central region (the point of convergence of the Ouagadougou-Lomé, Ouagadougou-Tema, and Ouagadougou-Niamey corridors) and Plateau-Central (on the Ouagadougou-Niamey axis) appear to present high potential along most indicators. Investments in transport infrastructure in these regions would presumably have a higher economic return than in others, such as the Sahel, where the economic potential is consistently assessed to be low. Burkina Faso’s Center-East region, crossed by the Ouagadougou-Lomé corridor, stands out as having both high agricultural potential and relatively high agglomeration potential. In comparison, when seen through the economic “lagginess”/linking-in lens, the need for investment and policy interventions appears to be greatest in the predominantly low-density parts of the study area, such as Burkina Faso’s North region, but also in the relatively densely populated regions in Niger that are close to the Niamey-Lomé/Niamey-Ouagadougou corridors and the Plateaux region in central Togo, traversed by the Ouagadougou-Lomé and the Niamey-Lomé corridors.

5.1. Characteristics and economic importance of the corridor immediate vicinity

Ouagadougou – Tema Box 1 provides information on the significance of the corridor’s buffer (20-km radius) zone for both Burkina Faso and Ghana. It shows that the 20-km buffer zone is home to nearly 30 percent of the combined population of Ghana and Burkina Faso and generates 41 percent of the two countries’ joint Gross Domestic Product (GDP). The analysis of the corridor’s buffer zone shows just how much more important the corridor is for Ghana than for Burkina Faso in terms of the concentration of the overall population, the poor population, and workforce. The corridor area concentrates 11 percent of the two countries’ poor population, which is disproportionately low given the corridor’s importance in the overall population. The figure is higher in the case of Ghana (26 percent), which is related to the larger share of the often self-employed or low-wage-earning agricultural workforce that live in the buffer zone in Ghana compared to Burkina Faso. Overall, the corridor is more important for Ghana than for Burkina Faso, although its importance in the national GDP generation is comparable. Compared to the areas outside the corridor buffer zone, less people in the buffer zone are employed in agriculture, especially in Burkina Faso, where only 11 percent of the workforce residing in the buffer zone are employed in the sector compared to 65 percent among the workforce living further away. In Ghana, the shares are 8 percent and 28 percent within and outside the corridor area, respectively. The corridor buffer zone in both countries tends to be wealthier than the rest of the territory, with average annual per capita consumption at US$2,761 within the buffer zone compared to about half that – US$1,442 – outside the buffer zone. A much larger share of the population living close to the corridor owns a motor vehicle compared to those living further away, and average expenditure on transportation is more than twice among the corridor area households compared to the households living in the rest of the two countries’ territory. Both per capita incomes and transport expenses are higher in the Ghanaian section of the corridor compared to the Burkinabe section, reflecting Ghana’s overall higher level of per-capita incomes and economic development.

Ouagadougou-Lomé Compared to the Ouagadougou-Tema corridor, people living in the 20-km buffer area of the Ouagadougou-Lomé corridor are disproportionately more employed in agriculture, and the average per capita consumption is considerably lower. Nevertheless, per capita consumption is still higher within the corridor area compared to outside of it. Similarly, per-household expenditures on transportation and access to a car are both significantly lower within the Ouagadougou-Lomé corridor buffer zone compared to Ouagadougou-Tema but are nevertheless much higher than outside the buffer zone.

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Niamey – Ouagadougou – Lomé The Niamey-Ouagadougou-Lomé corridor 20-km buffer zone represents nearly a quarter of the combined populations of Burkina Faso, Togo, and Niger, and as much as 42 percent of their combined GDP (Box 2). Given the relatively smaller size

Source: Estimated using the following data: Ghana Demographic and Health Survey 2014, LSMS 2014, 2017; Burkina Faso Demographic and Health Survey 2010, LSMS 2014, Povcal 2014; Landscan 2017 population data

Regional (Burkina Faso, Ghana)

Inside corridor Outside corridor

% of resident labor force in agriculture 9% 47%

Average annual per capita consumption (2017 US$) 2,761 1,442

% of resident population under the poverty line 12% 38%

% of resident population with access to a car 18% 5%

Average annual household spending on transportation (2017 US$) 1,739 877

Burkina Faso

% of resident labor force in agriculture 11% 65%

Average annual per capita consumption (2017 US$) 2,251 1,013

% of resident population under the poverty line 6% 50%

% of resident population with access to a car 14% 1%

Average annual household spending on transportation (2017 US$) 1,704 767

Ghana

% of resident labor force in agriculture 8% 28%

Average annual per capita consumption (2017 US$) 2,903 1,880

% of resident population under the poverty line 14% 25%

% of resident population with access to a car 19% 8%

Average annual household spending on transportation (2017 US$) 1,749 989

The corridor 20-km buffer area represents…

Burkina Faso & Ghana combined

Burkina Faso Ghana

29% 15% 39% % of population

41% 36% 42% % of GDP

11% 2% 26% % of population under the poverty line

7% 3% 15% % of agricultural workers

28% 31% 27% % of manual workers

32% 27% 34% % of sales workers

Box 1: Significance of the Ouagadougou-Tema corridor for the national and regional economies

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of Togo, the corridor buffer zone accounts for as much as 65 percent of the country’s population and 72 percent of its GDP. For Burkina Faso, the corridor area represents a larger population and GDP share compared to the Ouagadougou-Tema corridor area and a larger share of the population living below the poverty line. In the case of Niger, while the corridor area corresponds to only a fraction of the country’s overall area, it nevertheless generates over a quarter of its overall GDP. The corridor area is home to 8 percent of all the agricultural workforce of Burkina Faso, Togo, and Niger combined, and 41-42 percent of the countries’ manual and sales workers.

The corridor 20-km buffer area represents…

Burkina Faso & Togo & Niger combined

Burkina Faso Togo Niger

23% 21% 65% 7% % of population

42% 40% 72% 28% % of GDP

13% 8% 37% < 1% % of population under the poverty line

8% 10% 47% 2% % of agricultural workers

41% 30% 72% 29% % of manual workers

42% 31% 70% 30% % of sales workers

Box 2: Significance of the Niamey-Ouagadougou-Lomé corridor for the national and regional economies

Regional (Burkina Faso, Togo, Níger)

Inside corridor Outside corridor

% of resident labor force in agriculture 21% 72%

Average annual per capita consumption (2017 US$) * 1,863 889

% of resident population under the poverty line 25% 51%

% of resident population with access to a car 8% 1%

Average annual household spending on transportation (2017 US$) * 1,001 357

Burkina Faso

% of resident labor force in agriculture 26% 59%

Average annual per capita consumption (2017 US$) 1,868 1,010

% of resident population under the poverty line 17% 51%

% of resident population with access to a car 10% 1%

Average annual household spending on transportation (2017 US$) 928 528

Togo

% of resident labor force in agriculture 17% 36%

% of resident population under the poverty line 38% 66%

% of resident population with access to a car 5% 1%

*Note: the average excludes Togo; spending data is not available for Togo

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Niamey – Lomé via Ponio and eastern Burkina Faso The part of the Niamey-Lomé eastern corridor buffer zone that lies in the territory of Burkina Faso represents a significantly smaller share of the population or the national GDP than in the case of the Niamey-Ouagadougou-Lomé corridor – only 2 percent of the country’s population and 1 percent of its GDP. In contrast to the Ouagadougou-Tema and Niamey-Ouagadougou-Lomé corridors, the Niamey-Lomé eastern corridor buffer area in Burkina Faso’s territory is poorer than the area outside the corridor buffer: annual average per-capita consumption is only about US$930 compared to US$1,198 outside the corridor zone; 68 percent of the area residents in Burkina Faso are poor, compared to 43 percent outside the corridor buffer area; and the average household expenditure on transport and access to a motorized vehicle are lower than in the rest of the country’s territory (see Box 3). The Niamey-Lomé corridor zone in Burkina Faso also has a disproportionately higher share of the labor force employed in agriculture compared to the rest of Burkina Faso’s territory – unlike in the case of the other two corridors.

Niger

Inside corridor Outside corridor

% of resident labor force in agriculture 19% 88%

Average annual per capita consumption (2017 US$) 1,846 782

% of resident population under the poverty line 3% 49%

% of resident population with access to a car 15% 1%

Average annual household spending on transportation (2017 US$) 1,229 186

*Note: the average excludes Togo; spending data is not available for Togo

Source: Estimated using the following data: Burkina Faso Demographic and Health Survey 2010, LSMS 2014, Povcal 2014; Niger LSMS 2014, Povcal 2014; Togo Demographic and Health Survey 2014, Povcal 2015; Landscan 2017 population data

Box 2: Significance of the Niamey-Ouagadougou-Lomé corridor for the national and regional economies (cont.)

The corridor 20-km buffer area represents…

Burkina Faso & Togo & Niger combined

Burkina Faso Togo Niger

15% 2% 65% 7% % of population

23% 1% 71% 28% % of GDP

11% 3% 52% <1% % of population under the poverty line

5% 3% 49% 2% % of agricultural workers

30% 1% 72% 29% % of manual workers

25% 2% 70% 30% % of sales workers

Box 3: Significance of the Lomé-Niamey eastern corridor for the national and regional economies

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5.2. Economic lagginess of sub-national regions in the study area The broader sub-national regions, including those connected by the corridors in scope of the study, are characterized along two dimensions of economic “lagginess” to illustrate the extent of economic handicap compared to the other regions and, therefore, potential need for “linking-in” type policy interventions such as transport infrastructure that provides connections to markets and key services, investment in complementary productive infrastructure, and policy support. The two dimensions selected for describing economic lagginess are: (1) Local economic output: proxied by the absolute level of intensity of night lights in 2016; and (2) Poverty: the percentage of individuals in each region below the official poverty line. Lagginess, as measured by these indicators, is therefore a static concept rather than capturing a trend over time. The most recent available night-lights data at the regional average level (2016) suggests that the most economically isolated, or lagging, regions in the study area are Agadez, Zinder, Dosso, and Maradi in Niger and Sahel in Burkina Faso. At the other end of the scale are Greater Accra and Ashanti in Ghana, Niamey in Niger, the Central region in Burkina Faso, and Togo’s Kara and Maritime regions. All of the latter are in direct proximity to the corridors of scope of the study. In terms of the second economic lagginess indicator, Burkina Faso’s Central region, in which the Ouagadougou-Niamey, Ouagadougou-Tema, and Ouagadougou-Lomé corridors converge, has the lowest poverty rate (below 10 percent). Meanwhile, over 50 percent of the population are poor in the East region crossed by the Niamey-Lomé eastern corridor, and poverty incidence reaches 70 percent in the North. Regional differences also reflect the distribution and the productivity of agricultural activities, with cotton production concentrated in the South and South-East and these regions accordingly recording somewhat lower rates of poverty, although still higher than the more urbanized regions. The remaining large pockets of poverty notwithstanding, Burkina Faso’s economic growth over the last 15 years has been pro-poor, leading to reduction in the poverty rate from 53 percent in 2003 to 40.3 percent in 2014. In Ghana, the poverty ratio decreased from 31.9 percent (2005-06) to 24.2 percent (2012-13). Greater Accra had the lowest poverty rate in both periods,

Regional (Burkina Faso, Togo, Níger)

Inside corridor Outside corridor

% of resident labor force in agriculture 21% 67%

Average annual per capita consumption (2017 US$) * 1,634 1,000

% of resident population under the poverty line 33% 47%

% of resident population with access to a car 7% 2%

Average annual household spending on transportation (2017 US$) * 1,063 420

Burkina Faso

% of resident labor force in agriculture 68% 52%

Average annual per capita consumption (2017 US$) 930 1,198

% of resident population under the poverty line 68% 43%

% of resident population with access to a car 1% 3%

Average annual household spending on transportation (2017 US$) 511 632

*Note: the average excludes Togo; spending data is not available for Togo

Source: Estimated using the following data: Burkina Faso Demographic and Health Survey 2010, LSMS 2014, Povcal 2014; Niger LSMS 2014, Povcal 2014; Togo Demographic and Health Survey 2014, Povcal 2015; Landscan 2017 population data

35

while Upper West had the highest rate; also the Northern and the Upper East regions – crossed by the Tema-Ouagadougou corridor – lag.

Figure 10: Nightlights intensity (proxy for GDP)

Source: Ghosh et al. (2010)

36

Niger’s high fertility rate (7 births per women) and rapid population growth (3.4 percent/year) has undermined the gains derived from its GDP growth. In 2008, 60 percent of the Nigerien population lived below US$1 per day, while in Tillaberi and Dosso poverty reached 70 percent despite their proximity to Niamey and the Niamey-Ouagadougou and Niamey-Lomé corridors. More recent estimates of poverty incidence (from 2014) show that poverty remains highest in regions near the Nigerian border, at above 60 percent; in the Niamey area and closer to the Burkina Faso border poverty rate is 40-60 percent. Togo has implemented far-reaching reforms through successive poverty reduction strategies to reverse the trend of deteriorating macroeconomic and social indicators. Its steady economic growth between 2011 and 2015 improved living conditions for most of the population, with rural areas and secondary cities seeing a largely positive trend in consumption growth, due in part to growth in agriculture. In 2006-2015, the incidence of poverty fell by 6.6 percentage points (to 55.1 percent). Extreme poverty declined between 2011 and 2015 from 30.4 percent to 28.7 percent, although in the Lomé conurbation it increased from 4.6 percent to 13.7 percent. In internationally comparable terms, Togo has an extreme poverty rate of 49.2 percent. Self-employed farmers remain the social class with the highest poverty rate, despite improvements in 2011-2015 as a result of the significant public investment in the agricultural sector (République Togolaise, 2018).

Figure 11: Poverty rates based on most recent assessment for each country (percent)

Source: Burkina Faso: EMC 2014 (Burkina Faso SCD, World Bank, 2017); Togo: République Togolaise, QUIBB 2011 (Togo SCD, World Bank, 2016b); Ghana:

Ghana Living Standards Survey Round 6 (GLSS6) Poverty Profile in Ghana 2012/2013, Ghana Statistical Service, 2014; Niger: LSMS-ISA 2014

Overall, the two indicators of economic lagginess show similar spatial distribution. The Kara and Savanes regions in Togo stand out in that their poverty rates are extremely high despite relatively high levels of economic activity as proxied by night lights intensity. In the combined economic lagginess indicator, the lowest ranking regions are Burkina Faso’s North region, several regions in Niger (including Tillaberi and Dosso near the Niamey-Ouagadougou corridor), and the Plateaux in Togo crossed by the Lomé-Ouagadougou/Lomé-Niamey corridors (see Figure 2.1. in Annex 2).

37

5.3. Economic potential of sub-national regions in the study area Corridor development directly impacts the utilization of the region’s economic (productive) potential. As an example, around 40 percent of firms in Burkina Faso identify transport as a major business constraint according to the World Bank Enterprise Surveys – approximately the same share as in Togo. Transportation is a greater obstacle to firms in Burkina Faso compared to the Sub-Saharan Africa average of about 26 percent, although less so than in Mali and Cote d’Ivoire (Figure 12). Agricultural production in the region, too, continues to be under-developed due to the high transport costs and travel times between inland areas and coastal areas. For example, nearly 53 percent of farmers in Ghana indicate that the nearest roads in their areas are motorable with difficulty during the rainy season (Ministry of Roads and Highways, Ministry of Transport, and Ghana National Statistics Office 2012). The economic potential of the Niger River Delta, similarly to northern Ghana, remains underdeveloped. In Togo, the regional roads and rural tracks are non-existent or need to be rehabilitated. The poor quality of rural roads – providing access to the main corridors – leads to extremely expensive shipping fees which sometimes make up 1/3 to 1/2 of the product price. Some rural areas have an abundance of agricultural production but are isolated, and it is hard for them to access domestic food markets. Besides the transport infrastructure gaps, constraints to the full utilization of production potential are posed by the sometimes-complete lack of ancillary facilities and services: most farmers or their cooperatives do not have a warehouse to stock the produce, and producers in less accessible areas cannot access information regarding market prices, resulting in information asymmetry (JICA, 2018b).

Figure 12: Transport as a major constraint for firms in the region (percent of firms)

Source: World Bank Enterprise Surveys: Burkina Faso (2009), Cote d’Ivoire (2016), Ghana (2013), Niger (2017), Nigeria (2014), Mali (2016), Togo (2016), Benin (2016), Senegal (2014), Liberia (2017), and Guinea (2016)

The Tema-Ouagadougou corridor crosses Ghana’s most densely populated regions and is the main backbone for the supply of manufactured goods from Ghana’s South to its Center and North and for the supply of agricultural products from North to South. The corridor connects Tema to Kumasi, which is an important player in the auto parts industry. An important agricultural market along the corridor in Ghana is Techiman (Saana Consulting, 2016). There is thought to be high potential for agricultural and agro business development around Bolgatanga, Tamale and Kumasi, and the development of the corridor could unlock opportunities for the Burkina Faso agribusiness exports (USAID, 2017). The Lomé-Ouagadougou corridor crosses important economic regions within Togo: Kara (center of ferrochrome and iron mining exploitations), Lomé (phosphate mining), and Atakpame and Sokode (agriculture). On the Burkina side, potential for private sector development on the corridor has been identified around the so-called Bagre growth pole; there are also opportunities for the development of logistics centers along the corridor in addition to agro-processing.

0

10

20

30

40

50

60

Niger Ghana Togo BurkinaFaso

Nigeria Senegal Benin Liberia Mali Coted'Ivoire

Country Largest city

SSA

average

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While economic potential is known to be under-developed in some parts of the region, its magnitude certainly varies. Moreover, the economic potential is multi-dimensional, as are the investment needs associated with developing it. For instance, the potential for agro-processing – and the potential to develop livelihood alternatives to subsistence farming in secondary cities – is likely to depend not only on the agricultural potential and land suitability but also the availability of labor, agglomeration dynamics, and accessibility to markets. To inform the prioritization of corridor investments and ancillary infrastructure and policy interventions, the subsequent sections of the study characterize and rank the sub-national regions of Burkina Faso, Ghana, Niger, and Togo along several complementary dimensions of economic potential, some of them static while others – illustrative of trends over time: ▪ Agglomeration potential and economic dynamism: change in population over time, change in the share of urban

land over time, change in the intensity of night lights over time;

▪ Agricultural potential: current agricultural production, potential agricultural production, monetary value of current and potential agricultural production, livestock density, change in the share of cropland over time;

▪ Manufacturing potential: density of the primary and secondary road network per land area, adult literacy rates.

5.3.1. Agglomeration potential and economic dynamism Except for a few urban centers, most in the coastal areas, the region is characterized by low population densities. In 2015, only eight cities12 had population over 300,000; they represented the main centers of economic activity also as proxied by night lights. Over the last decade, significant population growth occurred in several urban areas along the corridors in scope of the study (Figure 13). It was the most pronounced around the largest metropolitan areas – Ouagadougou, Accra, and Lomé – and was more apparent around Ghana’s second city, Kumasi, compared to Niamey. Several smaller cities also recorded noticeable expansion, including Tamale, Bolgatanga, and Techiman (Ghana) and Kara and Dapaong (Togo). Between 2015 and 2040, the largest cities in Burkina Faso are expected to grow at annual rates between 3.5 percent and 5.5 percent. Greater Ouagadougou will reach 7.7 million inhabitants by 2040, or three times the 2015 size. On the path of the Ouagadougou-Niamey axis, the city of Fada N’Gourma will increase from 62,000 in 2015 to 172,000 in 2040. On the Lomé-Ouagadougou route, Pouytenga and Tenkodogo will increase their respective populations from 143,000 to 481,000 and from 62,000 to 139,000 (JICA, 2018). In Ghana, population is expected to become more concentrated in Greater Accra and Ashanti, at approximately 8.5 million and 10 million, respectively, in 2040. Greater Kumasi’s population is projected to increase to nearly 7.8 million by 2040; Tamale’s population – to 1.9 million (JICA, 2018b). In Togo, Greater Lomé is expected to reach nearly 5 million inhabitants by 2040, more than double the 2015 size. However, also other cities on the Lomé corridor will more than double within the next two decades: Kara and Atakpame will nearly triple, growing to 334,000 and 284,000, respectively. Sokode is expected to exceed 340,000 by 2040, up from 119,000 in 2015. These cities could function as service centers for their surrounding rural areas, but also accommodate manufacturing sectors, such as agro-processing. The ranking of the sub-national regions according to their overall agglomeration potential and economic dynamism shows that, among Burkina Faso’s regions, Cascades on the Ouagadougou-Abidjan corridor and the East region on the Niamey-Ouagadougou/Niamey-Lomé axes rank first and second, respectively. The indicators on which the two regions rank particularly high are overall population growth rate (2000-2015) and growth in the share of urban land (1992-2015). The Central region, home to Ouagadougou, ranks first in the overall region in terms of population growth since 2000, with a compound annual growth rate (CAGR) of 6.11 percent. In eight of Burkina Faso’s thirteen regions the share of urban land since 1992 has increased at CAGR above 5 percent, several of these crossed by the corridors in scope of the study: Center-South on the Tema-Ouagadougou corridor, Center-East on the Lomé-Ouagadougou route), and East crossed by the Ouagadougou-Niamey and the eastern Lomé-Niamey routes. Five of Ghana’s regions – Northern, Brong Ahafo, Central, Ashanti, and Upper West – are among the top 10 regions in the overall study area in terms of agglomeration potential and economic dynamism. Their high ranking is mostly due to the rapid

12 Ouagadougou (2,557,000) and Bobo-Dioulasso (771,000) in Burkina Faso; Accra (4,750,000), Kumasi (3,060,000), Sekondi-Takoradi (756,000), Tamale (495,000) in Ghana; Lomé (1,950,000) in Togo; and Niamey (1,027,000) in Niger.

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growth in night light intensity and significant increase in the share of urban land. Among Togo’s regions, the Central and Savanes regions rank highly, the former due to a significant increase in night light intensity and the latter due to rapid increase in population. The regions in Niger with most agglomeration potential and economic dynamism are Maradi and Dosso (the latter located near the Niamey-Ouagadougou/Niamey-Lomé corridors).

Figure 13: Population change in the corridor buffer areas (2007-2017)

Source: Estimated by Fraym based on Landscan population data

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5.3.2. Agricultural potential Burkina Faso has 9 million hectares of arable land, of which less than half are used. Representing more than 30 percent of GDP and more than 85 percent of the working population, the agricultural sector is the main source of livelihoods. However, approximately 50 percent of rural people remain poor, such as due to the lack of access to advanced production inputs (fertilizer) and poor accessibility to markets. Much of the territory is arid and prone to drought and floods, reducing soil fertility (Briceño-Garmendia and Domínguez-Torres, 2011). While cotton is exported outside the sub-region, other agricultural and livestock products are also exported to neighboring countries and sold to consumers of coastal areas (JICA, 2018). Ghana has more than 14 million ha of arable land, of which 56 percent is currently under cultivation. Agriculture, which used to contribute more than half of the GDP, in recent years has declined in its share, although 44 percent of the economically active population are still engaged in the sector (GSS, 2014; JICA, 2018b). Agriculture contributes over 40 percent of GDP and employs 70 percent of the economically active population in Togo and 90 percent in its rural areas. Of the 3.4 million hectares of arable land in good condition, only 45 percent are cultivated, in part due to lack of adequate mechanization and water management facilities (JICA, 2018b). Small-scale rain-fed cultivation of cassava, maize, and vegetables is commonly practiced (JICA, 2013). Finally, the arable land in Niger is estimated at 16.5 million hectares, equivalent to only 13 percent of the country’s territory, as around two-thirds of the country is desert. As of 2004, 4.5 million hectares—or 27 percent of the arable land—were dedicated to agriculture, mainly sorghum, cowpeas, and cassava. The area with the most irrigation potential is in the southwest, in the Niger River valley, close to the border with Burkina Faso. The coverage of the road network presents a challenge vis-à-vis the large size and relatively low population density: total road density over arable land is around 1/10th the density of other low-income countries (Domínguez-Torres and Foster, 2011). Food crops, such as maize, millet and sorghum, cowpea, soya beans, ground nuts, fresh vegetables and fruits in the region are mainly produced for self-consumption. However, a small percentage of maize production is traded (2-3 percent), and there are many small-scale traders that collect and trade maize, mainly along the large corridors, e.g.: Techiman-Leo-Ouagadougou, along which maize travels in both directions; Ouagadougou-Niamey; and others (USAID West Africa, 2014). Burkina Faso’s fresh vegetables are mainly sold in the neighboring Cote d’Ivoire, Ghana, and Mali; the main markets for maize and beans also include Niger and Cameroon. Crops such as cowpeas, tomato and mango have potential in the sub-regional markets as well. As niche products, sesame and tiger nuts are grown in some parts of the country. Strawberries grown in Burkina Faso are in high demand in the coastal areas (JICA, 2018b). Cotton is Burkina Faso’s main export cash crop, mainly exported to Asia – China, Singapore, Malaysia – while the main foreign markets of sesame seeds are Singapore, Japan, and Togo. The main export market for Burkina Faso’s cashew nuts is Ghana, followed by the distant Vanuatu and Singapore. Ghana and Togo’s main agricultural cash crops are exported to Europe, the U.S., India, China, and Japan.

Cocoa is a key export crop for Ghana in particular, representing 12 percent of exports in value terms in 2017. Cashews and coconut represent 2 percent of Ghana’s exports, 5 percent of Burkina Faso’s, and 3 percent of Togo’s. Oil seeds (sesame in particular) are important in Niger and Togo’s exports, accounting for 13 percent and 2 percent of the overall value, respectively. In 2017, overall agricultural exports represented between 13 percent (Burkina Faso) and 20 percent (Ghana) of the countries’ respective total exports. Togo has recently seen significant growth in cash crop production: for example, cotton production grew by 305 percent in 2010- 2016 (République Togolaise, 2018). Togo’s Ministry of Agriculture, Livestock and Hydraulics has prepared integrated regional economic development projects with a focus on agriculture and infrastructure development for growth poles, or “agropoles.” The rehabilitation or development of rural roads are seen as key for the agropole development in Oti, Kara, and Mono. While the number of livestock in West Africa has been continuously increasing since the middle of the 2000s, less than 1 percent of it is exported or imported. The coastal countries of West Africa have a deficit in meat production and depend on imports of live animals from the Sahel region and imported meat from outside of the continent. Burkina Faso and Niger are net exporters to the coastal countries – Nigeria, Ghana and Côte d’Ivoire (JICA, 2018c). The GoBF plans to intensify livestock production in existing production regions such as the Sahel, North, Center-North, and East (the latter located on the Niamey-Lomé/Niamey-Ouagadougou corridors). However, because animals are consumed and/or traded in major cities, transport linkages are necessary between the producing regions and these consumption centers (JICA, 2018b). Pastoral livestock systems contribute significantly to the national economy of Sahelian countries, accounting for 35 percent and 30 percent of the GDP of the agricultural sector in Burkina Faso and Niger, respectively. Around 80 percent of the

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farmers gain income from the sector in Burkina Faso. Poultry rearing plays an important role in income generation and poverty reduction, particularly for poor rural women. Forecasts project that demand for products of animal origin will grow 4 percent per annum, thus increasing by 270-280 percent by 2030 (USAID, 2017). Through corridor development, the livestock sector should be able to generate more income for rural producers and contribute more to economic development by supplying products to sub-regional markets. In Ghana in particular, the poultry sub‐sector is considered to have high potential to increase production because of the availability of grains which are the base ingredients for feed meal production. Interviews conducted by USAID (2017) with the region’s Ministries of Agriculture indicated that a major handicap in developing greater trade in commodities is the lack of efficient warehousing and distribution systems, especially those providing a cold chain. For example, processing plants with cold storage should be developed in Greater Accra, Ashanti and Brong Ahafo Regions (all on the Tema-Ouagadougou route) where poultry production is high (JICA, 2018b). Agricultural processing in the region has increased in recent years, albeit often practiced informally. Agro-industrial activities are not well developed in Burkina Faso. Traders collect agricultural products as a raw material from all over the country and send them to Ghana, Côte d’Ivoire and Nigeria. Agricultural products exported from Burkina Faso are processed and sold as foods or feed after adding value in other countries, and then such processed products are exported back into Burkina Faso (JICA, 2018b). However, countries have set targets in their national development policies to raise the processing ratio for cash crops and for formal agricultural trade. Burkina Faso’s goal is to increase the ratio of processing and trading of cotton, the main cash crop, from 12 percent (2015) to 25 percent by 2020; Togo aims to increase the ratio for cocoa from 19 percent (2015) to 29 percent (2020). In Burkina Faso, the Growth Pole, located on the Tema-Ouagadougou corridor, is one of the agricultural priority projects in the short term (2025). Among others, the project is supporting the rehabilitation of rural roads. The production and development of value chains of various crops are planned also in Ghana. For example, the Tamale-Mamprusi Agricultural Cluster Area Development Programme aims to promote the production of rice and other grains and poultry. Local agro-industries that use maize as a critical input include beer, pasta, couscous, fish, cattle/dairy and poultry production. Togo is already promoting agropole development at Kara and Oti.

Figure 14: Total agricultural production per km2 and cash crop production per km2, 2015-2017 average, (mt)

Total agricultural production Cash crop production

Source: SPAM model update produced for this study by International Food Research Institute (IFPRI)

Using harmonized sub-national crop statistics, the International Food Policy Research Institute (IFPRI) conducted an update of the Spatial Production Allocation Model (SPAM) crop-wise spatial model as an input in this study. The method also incorporates additional data for each country, such as population density, production intensity, production systems, irrigated

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areas, cropland, and potential crop areas, as well as assumption on advancements in farming practices and seed development, to estimate not only the current but also the potential agricultural production, by crop, at the pixel scale.13 The IFPRI model shows that agricultural production as measured by metric ton (mt) per land area is most intensive in the southern regions of all countries in scope and is much higher in Ghana than in the other countries, exceeding 250 mt/km2 compared to less than 20 mt in the least productive regions of Niger and Burkina Faso, including Burkina Faso’s East region crossed by the Ouagadougou-Niamey and Lomé-Niamey corridors (Figure 14). The total current production of key staple crops – sorghum, millet, rice, and maize – is the most intensive in the Niamey region in Niger, at over 42 mt/km2. Haut-Bassins is the highest-producing region in Burkina Faso in terms of staple crops. Staple crop production intensity is also high in Togo’s Savanes, Plateaux, and Maritime regions, all located on the Lomé-Ouagadougou/Lomé-Niamey axes, and in Ghana’s Eastern region.

Figure 15: Current and potential monetary value of overall agricultural production per km2 (US$)

Current Potential

Source: SPAM model update produced for this study by International Food Research Institute (IFPRI)

Cash crop production – here defined as export crops such as cotton and cocoa but also fruits, vegetables, spices and nuts – is somewhat less concentrated in coastal areas and Ghana compared to overall agricultural production. Still, the top seven cash producing regions per land area are all in Ghana, led by Western and Ashanti regions, where 98-100 mt of cash crops are produced per km2.The top cash crop producing region in Burkina Faso, as in the case of staple crops, is Haut-Bassins (on the Ouagadougou-Abidjan corridor), with 25 mt/km2. The estimated agricultural production potential in most parts of the region is significantly higher – sometimes by orders of magnitude – compared to the current production level. In the case of key staple crops, production potential relative to current production is estimated to be the highest in Burkina Faso’s Center-North, South-West, and East regions, where the potential exceeds actual production by 116-179 percent. The difference between potential and current production of staple crops is also particularly large in Kara (Togo), exceeding 100 percent. Even in Ghana, where production levels are already high, significant additional staple crop production could be unlocked in the Upper West and Upper East regions. In the case of cash crops, the untapped production potential is somewhat lower yet still significant. In Burkina Faso, the difference between the potential and the actual production is largest in the South-West region (72 percent), followed by Cascades (on the Ouagadougou-Abidjan corridor) and Center-North (48-49 percent). Of all the regions in the study area, by far the largest untapped cash crop production potential is in Togo’s Central region, where a 114 percent larger volume of

13 Pixel resolution is 5-degree minutes which is equivalent to a rounded figure of 10 x 10 km or 10,000 hectare per pixel. For the countries in this study the pixel size is between 7,877 and 8,561 ha.

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cash crops per land area could be produced than is currently the case. The potential for increasing cash crop production is generally low in Niger, except for Dosso and Niamey (~30 percent), both located on- or near- the transport corridor connecting the country to Burkina Faso and, further, to the coast. In sum, as shown by the comparison of the two maps in Figure 15, compared to the present, there is significant unutilized agricultural production potential in nearly all the regions of the study area. Based on international $ (average 2004-2006) prices as indirectly reported by FAOSTAT in their Value of Production data domain,14 significant potential to increase the agricultural production value exists in nearly all the regions crossed by the corridors in scope. For example, in the case of Burkina Faso’s East region (on the Lomé-Niamey eastern axis), the monetary value of overall agricultural production could increase from US$174.2 million now to US$281.3 million if the agricultural production potential were fully utilized. In the Center-East region crossed by the Lomé-Ouagadougou axis, production value could reach US$236.9 million, compared to US$156.8 million now. Finally, in the Center-South region located on the Tema-Ouagadougou corridor, production value could increase from US$108.7 million to US$146.8 million. The updated IFPRI model does not cover livestock; however, data on this aspect of agricultural production is available from the Regional Strategic Analysis and Knowledge Support System (ReSAKSS) country eAtlases for various years (ranging from 2010 to 2014). The data show Niger’s Niamey region to have by far the highest density of livestock (cattle, sheep, and goats) per land area, followed by Burkina Faso’s Central region. The observed changes in cropland as a share of overall land area suggest that several regions may be shifting away from agriculture despite significant current production and unused potential. This is the case of Ghana’s Western and Ashanti regions, where cropland as a share of land area decreased at CAGR of about 16 percent and 10 percent, respectively, between 2001 and 2012. Among Burkina Faso’s regions, cropland as a share of land area decreased in the Center-South. Aggregating the different agricultural potential indicators, the top 10 regions with highest potential span all four countries (see Figure 2.3. in Annex 2), with Ghana’s Upper East and Burkina Faso’s Haut-Bassins topping the list, and most regions in the top 10 are located on or near the corridors in scope of the study.

5.3.3. Manufacturing potential Burkina Faso’s manufacturing sector represented 6.3 percent of the national GDP in 2015 and employed about 10,000 people in 2011. Major types of manufacturing goods produced are agricultural processed products, beverages, and textiles, including cotton ginning (JICA, 2018a). The Directorate General of Industry (DGI) stresses the need for industrial zone development, such as the expansion of the Kossodo Industrial Zone in Ouagadougou and the Bobo-Dioulasso Industrial Zone and the creation of new industrial sites at Tanghin Dassouri for the chemical industry and at Koubri for the food industry. An important consideration in the development of manufacturing activities in the country is the need to secure production space, especially along the corridor areas (JICA, 2018b). Ghana’s manufacturing sector in 2015 represented 5.1 percent of the national GDP. According to Ghana Statistical Service, in 2015 manufacturing employed a total of 437,316 people. The Greater Accra region concentrates 23.4 percent of all manufacturing firms, followed by Ashanti (19.6 percent). A major objective is the development of industrial zones, especially along the Tema-Ouagadougou corridor (JICA, 2018b). For example, there are plans for a Tamale Industrial Zone (adjacent to Tamale). The typical industries along the Tema-Ouagadougou corridor at present are the manufacture of food products (based on cocoa, cashew, etc.), textiles, apparel, and rubber and plastics products. Additional expected types of industries include the manufacture of beverages, chemicals and chemical products, non-metallic mineral products, basic metals and fabricated metal products, electrical equipment, machinery, and furniture. The Industrial Policy by the Ministry of Trade and Industry (2012) stresses the challenge of land acquisition and the lack of adequate and cost-competitive physical infrastructure as critical factors constraining investment and competitive manufacturing.

14 The prices are assumed the same for each crop in all countries when it is a single crop (e.g. rice) but vary between countries when it is an aggregated crop (e.g. vegetables). Comparable individual country producer prices, in local currency or US$, are not available.

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Manufacturing in 2015 accounted for 6.5 percent of the GDP of Togo, and in 2014 there were 9 manufacturing Free Zones in the country, employing 2,408 people. The key manufacturing sub-sectors are agro-products, chemicals, cement, and beverages. The GoT aims to develop at least two industrial parks during 2018-2022 (République Togolaise, 2018). There are currently plans for new industrial areas in Kpomé and Adétikopé (JICA, 2018a). The National Development Plan (PRSP II) proposes to accelerate the growth of cotton yarn production for knitting and the manufacture of traditional fabrics and the manufacturing of fertilizer from phosphate for the local market. However, at present, the industrial sector is not yet well integrated into the other sectors (agriculture, livestock, fisheries, etc.), and challenges are presented by the high cost of energy, lack of ICT, lack of access to capital, and difficulty of accessing raw materials. The typical industries along the Lomé-Ouagadougou / Lomé-Niamey corridor, such as in Kara, include the manufacture of food products (based on cocoa, coffee, cereals, etc.), textiles (cotton), apparel, and rubber and plastics products. With the upgrading of the Lomé-Ouagadougou corridor, and assuming the provision of other economic infrastructure, Kara is expected to play a role of a major regional industrial, logistics, and commercial center in northern Togo. In Sokodé, also on the Lomé-Ouagadougou Corridor, an industrial park is proposed to be developed for agro-processing industries utilizing local products. An area’s manufacturing potential depends on numerous factors, including infrastructure availability, skills of the labor force, and access to local and international markets. For the sake of cross-comparability, the sub-national regions of the four countries are ranked on two indicators that matter for manufacturing development: access to the main road network (for sourcing raw materials and delivering finished goods to local and international markets) and adult literacy rates (a proxy for the availability of skilled or semi-skilled labor). The density of primary and secondary roads is by far the highest in the Niamey region, at 73.5 km per 100 km2 of land area, followed distantly by the other capital city regions – Greater Accra, Burkina Faso’s Central region, and Togo’s Maritime region. On the literacy indicator, regions surrounding the countries’ capital cities again rank highly; Greater Accra leads with an adult literacy rate of 79.1 percent, followed by Togo’s Maritime and Burkina Faso’s Central regions where the cities of Lomé and Ouagadougou, respectively, are located. In contrast, literacy rates are particularly low in several Burkina Faso regions located on the corridors in scope – it is less than 25 percent in Center-East, Center-West, East, and Center-South.15 Adult literacy is very low also in Niger’s Tillaberi region (~24 percent), despite its proximity to the country’s capital city. The rankings of sub-regions on the two indicators are summarized in Table 2.4 and Figure 2.9 in the Annex.

5.3.4. Summary As illustrated by the analysis above, different regions emerge as having most potential depending on the angle of potential considered. The overall pattern, shown spatially in Figure 16, suggests greater economic potential in Ghana (except its Northern region) and Togo, the western regions of Burkina Faso, and individual regions in Niger that border Nigeria. In Burkina Faso, Haut-Bassins (on the Ouagadougou-Abidjan corridor) emerges as the region with consistently high estimated economic potential, regardless of the dimension. The Central region (home to Ouagadougou) and Plateau-Central (on the Niamey-Ouagadougou route) also appear to present high potential along most indicators. Investments in transport infrastructure in these regions would presumably have a higher economic return than in others, such as the Sahel, where the economic potential is consistently assessed to be low. Burkina Faso’s Center-East region, located on the Ouagadougou-Lomé corridor, stands out as having both high agricultural potential and relatively high agglomeration potential; its cities, such as Pouytenga, Koupela, and Tenkodogo therefore represent potential future centers of value-added activities like agricultural consolidation and agro-processing, provided that connective infrastructure is provided to improve connections between these cities and the agricultural production regions and that ancillary facilities and services (consolidation, warehousing) are further developed. A similar role can be expected to continue to be played by the cities of Haut-Bassins, such as Bobo-Dioulosso and Hounde. In Ghana, there is a need to strengthen economic infrastructure, such as electricity, water and industrial parks, for supporting the development of Tamale as a major regional city in the Northern region for attracting investment to agro-processing industries targeting sub-regional markets. Similarly, in Togo, agro-processing industries in inland areas can be promoted by strengthening of infrastructure in Kara and Sokodé (major regional cities). Manufacturing can be expected to gain further strength in Ghana’s Upper West, Brong Ahafo, Ashanti, and Central regions (nearly all located on the Tema-Ouagadougou corridor) as well as in Togo’s Central, Plateaux, and Maritime regions; all these are characterized by both high manufacturing potential and strong agglomeration dynamics, with cities such as Kumasi, Wa, Sunyani, Techiman, and Sokode potentially playing an increasing role as urban manufacturing hubs.

15 Open Data for Africa (2014)

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Figure 16: Overall ranking of regions according to economic lagginess, agglomeration potential & economic dynamism, agricultural potential, and manufacturing potential

Economic lagginess Agglomeration potential & economic dynamism

Agricultural potential Manufacturing potential

Source: Authors’ assessment based on data from OSM, Goodman et al. (2019), estimates produced by IFPRI

When seen through the economic lagginess lens, the need for investment and policy interventions appears to be greatest in the predominantly low-density parts of the study area, such as Burkina Faso’s North region, but also in the relatively densely populated regions in Niger that are close to the capital city and the Niamey-Lomé/Niamey-Ouagadougou corridors – Tillaberi and Dosso – and in Togo’s Plateaux region. Following the summary of ranking along the economic lagginess and potential dimensions (Annex 2 Table 2.5), the sub-national regions can be categorized into those that are:

• Leading and have significant identified economic potential;

• Lagging but with significant identified potential on at least one dimension;

• Not lagging but also without clear identified potential on either dimension; and

• Lagging and without clear identified potential on either dimension.

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Further, grouping the sub-national regions by corridors that cross them (Table 2) highlights the fact that leading regions with high economic potential or lagging regions with significant identified potential on at least one dimension can be found in the path of every one of the corridors in scope of the study. The latter category of regions – those that are lagging but that have significant identified potential in agricultural production, manufacturing, or agglomeration – is perhaps the most relevant from the perspective of potential corridor interventions. Connective investments in these areas would not only have a pro-poor, “linking-in” role but also have high returns in terms of the economic activity that could be unlocked. Several regions in this category lie on the Niamey-Ouagadougou-Lomé route and the Niamey-Lomé eastern corridor, in particular, in Burkina Faso (Est) and Togo (Centre, Plateaux, and Savanes). Dosso (Niger), too, falls into this category, and, while it is not directly crossed by any of the corridors, it is proximate to the Niamey-Ouagadougou and Niamey-Lomé routes.

Table 2: Categorization of sub-national regions according to economic lagginess and potential

Sub-national region Corridors crossing the sub-national region Category

Bu

rkin

a F

aso

Boucle du Mouhoun

none

Lagging but with significant potential

Centre-Nord

Lagging, without much potential identified Nord

Sahel

Sud-Ouest Not lagging but also no clear potential

Cascades

Ouagadougou-Abidjan Leading, with significant potential

Haut-Bassins

Centre-Ouest Not lagging but also no clear potential

Centre-Est Ouagadougou-Lomé Not lagging but also no clear potential

Centre-Sud Ouagadougou-Tema Not lagging but also no clear potential

Centre All study corridors Leading, with significant potential

Est Ouagadougou-Niamey, Niamey-Lomé eastern route Lagging but with significant potential

Plateau-Central Ouagadougou-Niamey Not lagging but also no clear potential

Gh

ana

Ashanti

Ouagadougou-Tema Leading, with significant potential

Brong Ahafo

Eastern

Greater Accra

Northern

Upper East

Upper West

none

Lagging but with significant potential

Central

Leading, with significant potential Volta

Western

Nig

er

Agadez

none

Not lagging but also no clear potential Diffa

Dosso Lagging but with significant potential

Maradi

Tahoua Lagging, without much potential identified

Zinder

Niamey Ouagadougou-Niamey, Niamey-Lomé eastern route

Leading, with significant potential

Tillaberi Lagging, without much potential identified

To

go

Kara

Ouagadougou-Lomé, Niamey-Lomé eastern route Leading, with significant potential

Maritime

Centre

Lagging but with significant potential Plateaux

Savanes

Except for Tillaberi (Niger), regions that are lagging and that also lack any clear potential to be developed are mostly found far away from the specific considered corridors. Regions placed into this category are found in Burkina Faso and Niger, while none are classified as such in Ghana or Togo. Intuitively, these types of areas are more economically fragile and risk becoming increasingly more so in the future. Depending on population density and other characteristics, they may require specially tailored interventions aimed at improving physical connectivity, institutions, and overall basic standards of living.

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6. Expected economic impacts of corridor investments and policies 6.1. Regional-scale impacts: Insights from the application of a spatial general equilibrium model

Lower transport costs can be expected to lead to more trade, greater export diversification, increased attractiveness to foreign direct investment, and economic growth. However, the opportunities for better integration with foreign markets and subsequent economic gains are not even across sub-national regions within countries, driven by factors such as variability in the potential to produce tradable goods to be exported. Building on the assessment of economic production potential presented in Section 5, in this Section, six scenarios of corridor intervention “packages” are tested through a spatial general equilibrium model approach in order to estimate the expected impacts on real income growth at the District level in Burkina Faso and Niger, the study area’s two landlocked countries. The interventions considered include both hard infrastructure investment in key corridor sections in Burkina Faso, Niger, and Togo, as well as measures that would allow reducing border crossing and port processing costs and the fixed portion of the transport costs. The model results suggest that Niger would significantly benefit from investment in the corridors that link it to Burkina Faso and further to the port of Lomé, with real incomes to increase by between 0.17 percent and 0.52 percent. In the case of Burkina Faso, the expected real income growth is much more modest, except in the case of the improvement of the Ouagadougou-Lomé/Niamey-Lomé corridor section in Togo which would increase Burkina Faso’s real income by about 0.12 percent. Complementary measures that would allow reducing the fixed transport costs or the border crossing and pot costs would considerably amplify the income gains from corridor infrastructure improvements for both Niger and Burkina Faso. The gains would be particularly high for Burkina Faso with the complementary reductions in the fixed costs of the transport leg, increasing real incomes by 1.39 percent, compared to 1.32 percent in the case of complementary reductions in the fixed border and port costs. For Niger, the result is inverse: halving of the border and port costs (in addition to the infrastructure improvements) would increase real incomes by 2.57 percent, compared to 2.32 percent if assuming the complementary reductions in the fixed costs of the transport leg. The real income gains will be unevenly distributed also within the two countries: real income growth would be five to six times higher in the District that will gain the most compared to the District that will gain the least. Only the Districts with high potential to produce tradable goods (agricultural, manufacturing, etc.) and those that are well-connected will get the most out of corridor investments: for example, in the absence of good quality roads between the locations of export production, especially agriculture, and the main corridors, the impacts of corridor infrastructure investment on exports will remain limited.

6.1.1. The model assumptions New or rehabilitated corridors are expected to reduce transport prices and will therefore change the incentives of economic agents within countries. Lower transport prices (final transport costs to the shippers) reduce the price of imports for consumers and increase the price local exporters receive for their sales. Production of exports can be anticipated to increase in regions with lower transport costs, leading to an increase in profit margins for exporters and benefits for workers in terms of higher wages in the export and non-tradable sectors. In turn, the increased purchasing power of workers and the arrival of new workers can be expected to increase the demand for non-tradable goods and services, making more competitive regions denser while also putting pressure on land prices. Moreover, investing in trade corridors creates spillover benefits for other countries besides the one in which the investment happens. Predictions from the New Economic Geography literature suggest that improvements in connectivity are likely to be associated with more spatial concentration, not dispersion, of economic activity, as firms increase scale and benefit from agglomeration economies by locating near other firms engaged in similar and related activities. Some districts might lose whereas others might gain from better connectivity to the ports, driven by factors such as the share of local production that is tradable. A better understanding of the spatially differentiated implications of connectivity improvements is critical for economic efficiency as well as the political feasibility of corridor-related reforms and investments.

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The spatial general equilibrium model discussed here was developed and calibrated for Burkina Faso and its landlocked neighbor Niger to assess the impacts of transport interventions that reduce transport and trade costs along the corridor connecting Niamey to the port of Lomé via Burkina Faso’s East region. The model relies on work done on Argentina (Fajgelbaum and Redding, 2014), the Belt and Road Initiative in Central Asia (Lall and Lebrand, 2019), and Bangladesh (Herrera Dappe and Lebrand, 2019). It has three building blocks: geography, economic activity, and workers. They are connected through the goods prices, land rents, and wages in each district. Consistent with the idea of a general equilibrium, prices and wages adjust to balance supply and demand in each district. Each of Niger and Burkina Faso’s districts is characterized by its location, land area, livability, economic structure, and firm productivity. Livability captures the quality of life in a district, which is determined by factors such as the quality of education and health services. It influences where people chose to live. Economic structure refers to the share of employment in tradable and non-tradable sectors in the district. Although production inputs are similar across districts, the productivity of firms differs, because of factors such as the infrastructure and technology available. The model only looks at the port of Lomé as a gateway for imports and exports from global markets and puts aside other ports, such as Cotonou, for example. Four types of data at the district level are used: land area, number of employees, sectoral shares of employees, and transport costs. Land area consists of land units (cropland, irrigated, urban land) using the European Space Agency land categories (Goodman et al., 2019). Data from IFPRI is used to estimate the surface used for crops. Population estimates at the district level and employment shares in the tradable16 and non-tradable sectors come from Niger’s National Survey on Household / Living Conditions and Agriculture 2014, Wave 2, and Burkina Faso’s Continuous Multi-sectoral Survey 2014. Three types of costs are incurred by traders when travelling towards the port of Lomé: transport costs, border costs, and port costs. Each of these has two components: a fixed cost and a variable cost. The variable part of the transport cost is a function of the time it takes from the center of the district to the port of Lomé. The travel time, which is calculated using GIS, is the shortest time given all possible routes in the road network. Travel times are estimated based on various reports, such as Saana Consulting (2015b, 2016), JICA (2018a), and the infrastructure quality data available from Government recent assessments for Burkina Faso, Niger, and Togo. Fixed costs are estimated using prices collected in different reports and cover all the other factors linked to the efficiency of the transport sector, the presence of roadblocks, or logistics constraints. The variable part of the port and border costs is a function of the waiting time; the fixed cost includes the rest that is independent of time. We assume that the share of the total transport costs due to variable costs, proportional to the driving time, represents less than 40 percent of the total. It means that factors other than the quality of the road infrastructure are also important in explaining the high levels of transport costs.

6.1.2. Scenarios (Counterfactuals) Three transport investments along the main trade corridors and two soft interventions to reduce prices through a better functioning of the transport sector are considered here. The considered infrastructure investments aim at rehabilitating three key priority road sections of the corridors that allow Niger and Burkina Faso to reach the port of Lomé (Figure 17). These investments were originally prioritized in the World Bank financed Lomé-Ouagadougou-Niamey Regional Corridors Project currently under preparation.

Scenario 1: Section of the national road NR19 in Burkina Faso, towards the border with Togo which crosses the East region and forms part of the Lomé-Niamey eastern corridor.

Scenario 2: Section of NR6 in Niger between Niamey and Torodi. This road, currently in poor condition, is the path through which trucks from Niamey can reach Burkina Faso and subsequently the port of Lomé.

Scenario 3: Section between Davie and Atakpame of RN1 in Togo, the main North-South corridor.

Scenario 4: All the above transport corridor infrastructure investments combined.

16 Tradable sectors here include crop-based agriculture, cattle farming, and mineral goods sold rather than consumed directly by the household. Very small-scale farmers are not considered, as they do not export.

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Investment in these road sections would reduce the variable component of transport costs to the Port of Lomé. Variable costs based on estimated post-investment travel times are used in the economic model to quantify the economic gains from these transport investments.

Figure 17: Transport investments considered

Scenario 1 Scenario 2 Scenario 3

Source: Google maps

In addition to infrastructure investments, policies and regulations are necessary to the improve the functioning of the transport sector, e.g. reduce the importance of cartels or improve the quality of the services. Strengthening of the implementation of the Customs Union in the region, actual operationalization of OSBPs, improved Customs inter-connectivity, harmonization of border procedures and cross-border cooperation, and improvement of clearance process through green channels and risk management are all measures that are proposed, planned or currently in implementation across the region. They have the potential of significantly improving the ease of international border crossings within the study region, even if each by itself may not be sufficient. Without imposing assumptions on the exact interventions that would achieve each type of cost reduction, we test the impacts of the following “soft” scenarios:

Scenario 5: Scenario 4 + Implementation of a set of policies or regulations that would lead to a decrease in the transport fixed costs by 50 percent.

Scenario 6: Scenario 4 + Reduction in border and port costs by 50 percent.

6.1.2. Which regions gain more and which less: the model results The considered interventions, on average, will benefit Niger more than Burkina Faso. National gains for Niger are relatively large: transport corridor infrastructure investment between Niamey and the border with Burkina Faso (Scenario 2) and along the corridor section in Togo (Sc. 3) will increase real incomes by 0.17 to 0.25 percent, while the improvement of NR19 in the Burkina Faso territory – i.e., the portion of the Niamey-Lomé eastern corridor route that lies within Burkina Faso (Sc. 1) – would increase Niger’s real incomes by as much as 0.52 percent. For Burkina Faso, the income gains from these infrastructure investments are smaller. Even though the investment considered in Scenario 1 takes place in Burkina’s own territory, the resulting national gains in terms of access to Lomé are very small. The income gains for Burkina Faso are larger from the rehabilitation of the Togo section of the Ouagadougou-Lomé corridor, estimated at about 0.12 percent (Figure 18). Other interventions that make the transport sector more efficient and reduce border and port costs would substantially amplify the income gains from the corridor infrastructure investments for both Niger and Burkina Faso. Improving the road infrastructure mostly affects the variable costs for transport providers, while the fixed costs depend on other interventions. While improving the quality of the roads is important, the income gains could be increased yet more significantly by implementing complementary policies or regulations that reduce the fixed part of the overall transport and logistics costs. The model results suggest that the gains would be particularly high for Burkina Faso with the complementary reductions in the fixed costs of the transport leg (Scenario 5), increasing real incomes by 1.39 percent, compared to 1.32 percent in the

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case of complementary reductions in the fixed border and port costs (Scenario 6). For Niger, the result is inverse: halving of the border and port costs (in addition to the infrastructure improvements) would increase real incomes by 2.57 percent, compared to 2.32 percent if assuming the complementary reductions in the fixed costs of the transport leg. Under all scenarios, Niger, on average, is expected to benefit more than Burkina Faso, the difference in real income gains being the smallest in the case of the Togo corridor improvement (Scenario 3).

Figure 18: Real income gains from interventions under the different scenarios (percent)

Source: Authors’ calculations

Importantly, the expected gains in real incomes would be unevenly shared across regions within Niger and Burkina Faso. In the case of all the considered corridor infrastructure investments, there are regions that would lose from the investments and other regions that would highly benefit, as a result of their improvement in connectivity to global markets. These regions would become more competitive and attract more workers, out of other regions whose real income would decrease somewhat. Assuming the improvement of Togo’s RN1, for example, while Niger’s real income would, on average, increase by 0.17 percent, individual districts within the country would see real income increase of as much as 0.6 percent, while others would see real incomes decline by 0.15 percent. In the case of Burkina Faso, the heterogeneity of impacts across districts would be somewhat smaller, ranging from a real income gain of 0.44 percent to a loss of 0.20 percent (Figure 19). In the case of the complementary reductions in transport fixed costs (Scenario 5) or the complementary reductions in port and border costs (Scenario 6), real income growth in each of the two countries would be five to six times higher in the district that will gain the most compared to the district that will gain the least. In all scenarios, the gap between the districts benefiting the most and those benefiting the least (or losing) is much wider in Niger compared to Burkina Faso, which can be attributed to more starkly heterogeneous baseline conditions in Niger compared to Burkina Faso. Whether districts gain from transport interventions depends not only on changes in transport costs but also on the districts’ other characteristics, such as sectoral productivity, density of population, share of overall labor force employed in the tradable goods sector, and current real wage. In Niger, the districts that benefit the most from the transport investments in Burkina Faso (Scenario 1) and Niger (Scenario 2) are those with a relatively high potential in exports with a high share of employment in tradables. In the case of the corridor infrastructure investment in Togo (Scenario 3), income gains are the highest for those districts of Niger that benefit from the largest reductions in transport costs and for those districts in Burkina Faso that are more densely populated and have lower baseline real incomes. When considering all transport corridor investments together, the main determinant behind income gains for Niger is the reduction in transport costs while for Burkina Faso the districts’ baseline characteristics matter more.

0.01

0.52

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0.250.12 0.170.13

0.95

1.39

2.32

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Scenario 1 Scenario 2 Scenario 3 Scenario 4 Scenario 5 Scenario 6

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Figure 19: Range in the expected change in real incomes across districts within countries (percent)

Burkina Faso Niger

Source: Authors’ calculations

Non-infrastructure investments are found to mostly benefit the districts with a higher potential for exports: the share of employment in the tradable sector is the main predictor for higher income gains for both Niger and Burkina Faso. The share of employment in the tradable sector, in turn, is intuitively linked to the sub-national level agricultural and manufacturing potential discussed previously. For example, compared to the average real income gains predicted for Burkina Faso overall under Scenario 5 (1.39 percent), the Haut-Bassins regions that was assessed to have the highest agricultural potential in the country (and second highest in the overall four-country area) is expected to see a real income gain of as much as 2.03 percent. Under Scenario 6, Haut-Bassins’ real incomes are expected to increase by 1.93 percent, compared to the country’s average of 1.32 percent. In Niger, similarly, the region of Dosso, which was assessed to have some of the highest agricultural production potential in the overall study area, is expected to see a real income rise of 3.21 percent and 3.54 percent under Scenario 5 and Scenario 6, respectively, compared to Niger’s average of 2.32 percent and 2.57 percent. Figure 20: Expected real income change at the District level under Scenario 4 (all corridor infrastructure investments combined)

Source: Authors’ calculations

-0.3

0.7

1.7

2.7

3.7

4.7

5.7

6.7

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Scenario2

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Another important finding from the spatial model is that the districts in Burkina Faso that benefit more also tend to have lower baseline real incomes, which suggests that the considered interventions would lead to some degree of spatial convergence in incomes across districts. In addition to the scenarios considered above, yet additional complementary policies would allow further increasing the economic impact of the transport investments and trade facilitation measures. Two such policies focus on improving road connectivity from productive areas and consumption centers to the main corridors, and on reducing the barriers to the mobility of workers within and across countries – such as formal restrictions to move or frictions in the labor or housing markets – to ensure that labor can be reallocated towards regions with growing tradable sectors.

6.2. National and sub-regional impacts in Burkina Faso: Evidence from spatial accessibility analysis

In addition to the impacts on international trade and competitiveness, corridor improvement will also have more localized economic impacts, through improved access to domestic markets for consumers and producers. As a final analytical “lens”, the study applies a Burkina Faso-only focused spatial accessibility analysis that models change in accessibility for consumers and for agricultural produce to urbanized areas of significant size (proxies for “markets”) under several transport infrastructure improvement scenarios. The analysis shows that the improvement of the Niamey-Lomé eastern corridor section in Burkina Faso would result in a significant reduction in travel time to the nearest major local market for about 19,000 people (consumers); the added rehabilitation of the eastern half of the Niamey-Ouagadougou axis would increase the number of beneficiaries to nearly 64,000, while the added improvement of the access roads connecting these two corridors would make the biggest difference, nearly doubling the figure to 119,000. Finally, the improvement of the road connecting the Ouagadougou-Tema and the Ouagadougou-Lomé corridors in southern Burkina Faso would significantly reduce travel time to a major city for about 34,000 people, hence, double the number of beneficiaries as expected from the improvement of the Niamey-Lomé eastern corridor.

In addition to the market accessibility benefits for the local consumers, the improvement of the Niamey-Lomé eastern route in Burkina Faso would result in a significant reduction in travel time to market for an annual volume of about 5,200 mt of staple crops (12,000 mt if assuming full utilization of production potential), with an annual market value of US$650,000 (US$2 million). The added improvement of the Niamey-Ouagadougou corridor would increase this figure nearly six-fold, while the addition of improvements of the access roads connecting the two corridors would raise it to 47,000 mt (>100,000 mt), worth US$5.7 million (US$16.2 million). In addition, the improvement of the Niamey-Lomé eastern route would significantly reduce travel time to market for 475 mt of perishable produce annually, worth about US$136,000 (or 640 mt worth US$187,000 if assuming the utilization of the full production potential). The added improvement of the Niamey-Ouagadougou route would increase those figures more than five-fold. Finally, the added improvement of the connecting roads between the two corridors would again nearly double the volume and value of produce that can be brought to market significantly more quickly.

This section presents complementary spatial analysis that focuses specifically on Burkina Faso and quantifies the impacts of corridor and other road improvements on accessibility to major urbanized areas, defined as having population of at least 50,000, which represent local markets of significant size and also centers of other types of “opportunities” besides consumption and agricultural trading (e.g., employment, public services, etc.). Under several different scenarios, shown in Figure 21, the analysis simulates changes in accessibility to the major cities for:

(1) The local consumers/ population, based on the population distribution estimates available from World Pop 2014; (2) Agricultural produce – overall production as well as specifically staple crops and perishable produce – based on

the agricultural production and production potential estimates prepared for this study by IFPRI. The first set of scenarios, which cumulatively build on one another, focus on the main corridors in the East and Center-East regions of Burkina Faso whose current condition is assessed as “poor”, including the corridor section covered by the World Bank-financed Lomé-Ouagadougou-Niamey Regional Corridors Project, as well as related connecting roads whose improvement has been prioritized by the Burkinabe government. The baseline road conditions are assumed as shown in Figure 7 presented earlier.

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Scenario 1: Rehabilitation of priority road sections on the N19 towards border with Togo, i.e., the eastern route of the Lomé-Niamey corridor, crossing the relatively economically lagging East region, with few major urban centers in its proximity yet with relatively high estimated agglomeration potential. In this scenario, the speed on N19 is assumed to improve from the current 40 km/h (corresponding to poor condition) to 70 km/h (good condition).

Scenario 2: Scenario 1 + rehabilitation of N4, i.e., part of the Ouagadougou-Niamey axis, connecting rural areas to the cities of Pouytenga and Fada N’Gourma. The N4 is assumed to be improved from poor to good condition, with a corresponding increase in average speed from 40 km/h to 70 km/h.

Scenario 3: Scenario 2 + rehabilitation of the secondary and tertiary roads (N17, N26, R32, and D38) that link the N19 and the N4. The condition on these roads is assumed to improve from poor to good, with a corresponding increase in average travel speed to 50 km/h (secondary roads) and 40 km/h (tertiary roads).

Figure 21: Road sections rehabilitated in each of the accessibility analysis scenarios

The last scenario separately simulates the impact of primary and secondary road improvements that have been prioritized for rehabilitation by the Burkina Faso Ministry of Infrastructure and that are anticipated to be financed through the Burkina Faso Integrated Connectivity and Mobility Project, also currently under preparation.

Scenario 4: Rehabilitation of sections of N20 and N25, located near the Ghanaian border in the country’s Center-West and Center-South regions. These roads provide a connection between the Ouagadougou-Tema and Ouagadougou-Lomé corridors in southern Burkina Faso. The condition of the roads is assumed to improve from poor to good, with corresponding increases in average travel speed.

The accessibility impacts for agricultural production are monetized using average past international prices, given the difficulty of assembling local market-specific price data for every type of agricultural crop. However, there is evidence that the prices of key staple crops vary considerably across the regions within Burkina Faso and that this variation is directly linked to the existing gaps in the transport network. According to the World Food Program’s database, maize in 2018 was 48 percent and 30 percent more expensive, respectively, in the low-accessibility Sahel and North regions, compared to the much better-

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connected Cascades region near the Ivorian border. In the poorly connected East region near the Nigerien border, similarly, maize cost 22 percent more than in Cascades and 15 percent more than in Center-East, located on the crossroads of the Ouagadougou-Lomé corridor and the Ouagadougou-Niamey corridor, where the towns of Tenkodogo and Pouytenga represent the major markets. Accessibility for consumers/population

At present, about 54 percent of the country’s population of 17.4 million (according to 2014 World Pop data) is estimated to live within 2 hours of motorized travel to the nearest major city, while 5 percent live 5 or more hours away. The baseline accessibility is estimated to be poor for large areas in the country’s North; along the Ghanaian border, including on the path of the Ouagadougou-Tema corridor; as well as all along the borders with Niger and Benin (Figure 22). This is due to gaps in the quality of the major roads in these areas, as was shown in Figure 7 earlier, but also due to the sparsity of feeder roads providing connections to the main corridors. Four of the cities with current populations over 50,000 are located on the road corridors in scope of the study: Pouytenga and Fada N’Gourma on the Ouagadougou-Niamey section; Tengodogo on the Ouagadougou-Lomé route; and Ouagadougou. On the eastern route of the Niamey-Lomé corridor, there are no large cities in direct vicinity. Combined with the poor road condition on this section, this leads to low accessibility to any local markets of considerable size for the consumers and producers residing in this area, with motorized travel times of 4 or more hours.

Figure 22: Motorized travel time to the nearest urbanized area with population over 50,000, baseline (current)

Source: Authors’ estimates based on available data on road conditions and OSM data on locations of urbanized areas

The accessibility analysis suggests that the rehabilitation of the main axes of the Niamey-Lomé and Ouagadougou-Niamey corridors by themselves (Scenarios 1 & 2) would have significantly smaller impact on the consumers’ accessibility to major local markets compared to the impacts that could be expected if the connecting roads between the corridors were improved as well (Scenario 3). Overall, the improvement of N19 would result in a significant reduction in travel time to the nearest major local market for about 19,000 people; the added rehabilitation of N4 would increase the number of beneficiaries to nearly 64,000, while the added improvement of the roads connecting N19 and N4 would raise that figure to about 119,000. In other words, the accessibility impact for consumers would be over 6 times higher under Scenario 3 compared to Scenario 1. Finally, the improvement of the roads prioritized by the Burkinabe Ministry of Infrastructure that connect the Ouagadougou-Tema and Ouagadougou-Lomé corridors would reduce travel time to a major city for about 34,000 people, hence, double the number of beneficiaries of Scenario 1. The detailed results of the accessibility analysis are provided in Annex 5.

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Accessibility for agricultural produce

Staple crops (rice, maize, millet, sorghum): Considering the current spatial distribution and production volumes as estimated by the updated IFPRI SPAM model, the improvement of N19 would result in a significant reduction in travel time to major domestic markets for an annual volume of about 5,200 mt of staple crops (12,000 mt if assuming full utilization of production potential), with an annual market value of US$650,000 (US$2 million). The added improvement of N4 would increase this figure to 30,000 mt (69,300 mt), worth US$3.7 million (US$11.2 million), while the addition of improvements of the roads connecting the two corridors would raise it to 47,000 mt (>100,000 mt), worth US$5.7 million (US$16.2 million). In other words, about nine times greater volume and value of staple crops would be made more rapidly transportable to a major local market under Scenario 3 (corridor improvements only) compared to Scenario 1 (corridor improvements + connecting road improvements). As a reference, the total current annual volume of staple crops produced in the East and the Center-East regions combined is about 685,000 mt, worth US$117.8 million. Finally, the road improvements considered separately under Scenario 4 would benefit 4,600 mt (7,900 mt) of staple crops with an annual market value of US$460,000 (US$1.2 million).

Figure 23: Volume of staple and perishable crops for which travel time to local markets will be significantly reduced (mt/year)

Figure 24: Value of staple and perishable crops for which travel time to local markets will be significantly reduced (US$/year)

Source: Authors’ estimates

5,153 475

12,119

639

30,083

2,561

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100,130

7,179 4,629 279

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Staple crops, current (mt) Perishable produce, current(mt)

Staple crops, potential (mt) Perishable produce, potential(mt)

Scenario 1 Scenario 2 Scenario 3 Scenario 4

647,971 136,411

1,976,629

187,177

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768,131

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1,191,097

5,696,447

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135,165

Staple crops, current (US$) Perishable produce, current(US$)

Staple crops, potential (US$) Perishable produce, potential(US$)

Scenario 1 Scenario 2 Scenario 3 Scenario 4

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Perishable produce (fruits and vegetables): Good accessibility to local markets is yet more important for maximizing the returns for the agricultural producers growing perishable agricultural produce, given that it can rapidly lose value in the absence of a well-integrated cold chain and risks to be damaged if transported for long hours. Based on current production volumes, the improvement of N19 would significantly reduce travel time to market for 475 mt of perishable produce, annually, worth about US$136,000 (or 640 mt worth US$187,000 if assuming the utilization of the full production potential). The added improvement of N4 would increase those figures more than five-fold, to over 2,500 mt worth US$770,000 (or 4,000 mt worth US$1.2 million). Finally, the added improvement of the connecting roads between the two corridors would again nearly double the volume and value of produce that can be brought to market more quickly compared to the scenario in which only N19 and N4 are rehabilitated. The improvement of roads under Scenario 4 would have a slightly smaller impact on accessibility to domestic markets for perishable produce compared to the improvement of N19 (Scenario 1).

All crops: In addition to key staple crops and perishable produce, the road improvements considered under the four scenarios would benefit a range of other agricultural crops as well, including other cereals besides rice, maize, sorghum and millet; pulses; and various cash crops and spices that are more likely to be exported than sold in local markets.17 If, however, assuming that all of the production could be marketed locally, the most ambitious of the scenarios (Scenario 3) would imply a significant reduction in travel time to market for a total annual volume of about 78,000 mt of crops at current production levels and 142,000 mt with the full utilization of estimated agricultural production potential.

7. Policy implications and conclusions

Regional integration, better access to global markets, and transition from mostly raw material-producing to higher value-added, modern economies are increasingly central, shared aspirations of Burkina Faso and its neighboring countries, with transport connectivity seen as a key bottleneck for these aspirations to be realized. Transport costs and times on the corridors connecting Burkina Faso to gateway ports remain high although have seen reductions in recent years, especially in the port and the final clearance (Ouagainter) trip legs. Significant progress has been achieved in closing the hard infrastructure gaps on the trunk roads, with the Ouagadougou-Tema and Ouagadougou-Lomé axes mostly in fair-to-good condition. On the other hand, the condition of the trunk corridors connecting Burkina Faso further to the landlocked Niger – via the Ouagadougou-Niamey axis and the eastern Niamey-Lomé route – remain poor, effectively limiting Niger’s options for accessing the coast to just the Cotonou-Niamey corridor. Among the road corridors, Ouagadougou-Lomé represents the lowest-cost transport option for Burkina Faso’s external trade, explaining the concentration of over a fifth of Burkina Faso’s population and 40 percent of the national GDP in the corridor’s 20-kilometer radius. The Ouagadougou-Tema route, currently more expensive primarily due to the transport leg, is used mostly for regional and Ghana’s domestic trade, its buffer zone accounting for nearly 40 percent and 42 percent of Ghana’s population and GDP, respectively. The final corridor analyzed in this study, the eastern route of the Niamey-Lomé route, remains sparsely traveled; unlike in the case of the other two corridors, its buffer area in Burkina Faso is characterized by much higher poverty incidence compared to the country’s average. Besides the remaining gaps in the road condition on the main corridors, a key factor contributing to high transport costs in the study region is the poor quality of rural access roads that link the main corridors to agricultural and other types of production areas and to local consumers. The large trade imbalance (much higher import volumes compared to export) of countries such as Burkina Faso and Niger vis-à-vis their global trade partners is another factor that drives up the overall roundtrip price of transport, and it is at least partly a result of the poor accessibility from the corridors to the production zones which prohibits productive potential from being fully utilized. The efficiency of Burkina Faso’s main gateway ports, despite improving as a result of significant investment in recent years, remains low compared to global averages. Border crossing efficiency is still hampered by lack of application of effective

17 For example, cotton, oil palm, soybeans, coconut, cashew nuts, sesame seeds, coffee, cocoa, and tobacco.

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trade regimes, Customs interconnection, or functional OSBPs. However, perhaps even more significant – albeit not easily quantifiable – cost penalties are associated with the political economy of freight transport organization on the corridors, including factors such as the automized trucking sector and lingering application of freight sharing agreements that prohibit full competition in the freight transport market (see Bove et al., 2018, for a detailed account). Finally, because economic sectors in inland areas are not yet highly developed, the imports into the hinterland exceed exports by orders of magnitude, and the demand for transport services from inland areas to coastal markets is low. As a result, the cargo transport between inland areas and coastal areas is inefficient, pushing up the prices of production inputs in inland areas.

Policies promoting better coordination of information between shippers, logistics service providers, Customs, port operators, and transporters should be prioritized, along with those that can reduce the number of transit processing steps in the ports and at the borders. Increased efficiency in transport scheduling at the ports and at final clearance facilities would help address the issue of slow truck rotations on the corridors, allowing transporters to reduce the fixed costs of transport and begin to invest in more modern fleets. Corridor efficiency monitoring mechanisms should be improved – and regional coordination in corridor investments and management strengthened18 – to elevate the issues politically and build buy-in among policy makers and other stakeholders to help push the necessary reforms forward. Interaction of policies should also be considered in setting priorities; for example, policies that encourage more modern trucking fleets should be linked to those that create conditions for more competition in freight pricing. Several previous studies have attempted to quantify the potential economic benefits of improving the transport and logistics infrastructure and procedures in the study region. For example, USAID/West Africa Trade Hub (2012) found that if all its recommendations were implemented, the potential annual savings would be almost US$80 million: US$71.2 million for imports and US$8.3 million for exports. The current study provides a complementary assessment of the economic benefits from improved corridor infrastructure and complementary policies in Burkina Faso and its neighboring countries more specifically, approaching the question both from an international connectivity and competitiveness perspective as well as from a domestic market accessibility lens. International connectivity benefits and sub-national impacts Lower transport costs can lead to more trade, greater export diversification, increased attractiveness to foreign direct investment, and economic growth. However, the opportunities for better integration with foreign markets and subsequent economic gains vary across sub-national regions. As shown by the study, not all regions have equal potential to produce agricultural and other tradable goods to be exported, and the poor quality of the domestic transport market limits the access of more isolated populations and economic activities to cheaper imported goods. One of the most striking empirical regularities is the huge divergence in economic activity within countries. It is therefore important to not only look at the national gains from trade integration but also the spatial effects across sub-national regions. Whether trade integration and transport interventions along trade corridors increase or decrease spatial disparities and economic concentration is a key policy question. It is determined by a range of factors, including the magnitude of improved market access, local comparative advantage, and mobility of people within and between countries. Results of the spatial economic model tested in this study suggest that while Niger in particular can be expected to benefit from infrastructure investment on the transport corridors that link it to Burkina Faso and further to the port of Lomé, with real incomes to increase by 0.17-0.52 percent depending on the road corridor improved, complementary interventions that make the transport sector more efficient and reduce border and port costs would substantially amplify the income gains from infrastructure investments for both Niger and Burkina Faso. In Burkina Faso, the gains are estimated to be particularly high if corridor infrastructure rehabilitation were complemented by policy interventions that lead to reductions in the fixed costs of the transport leg, resulting in an increase in average real incomes by 1.39 percent. Reductions in the fixed costs of transport on the corridors can be achieved through policies that promote more competitive supply-demand matching in the trucking market or that allow truckers to increase the number of annual trips on the corridors, among others. In contrast, in Niger,

18 For example, the ECOWAS-commissioned Study for the Development of an ECOWAS Corridor Management and Development Strategy and Action Plan recommended strengthening the National Road Transport and Transit Facilitation Committees (NRTTFCs) and establishing Corridor Management Committees (CMC). It also suggested the establishment of a Regional Fund for Infrastructure and a Regional Transport Infrastructure Unit (RTIU) to manage the development and preservation of the regional transport infrastructure (see USAID, 2017).

58

complementary reductions in the border and port costs would matter more than reductions in the fixed transport costs, leading to an income gain of as much as 2.57 percent. Moreover, the model shows that the benefits from infrastructure investments and complementary policies will be unevenly spread across workers and locations, with real income gains in each of the countries expected to be five to six times higher in the districts that will gain the most compared to those that will gain the least. Only the districts with potential to produce tradable goods and with good connectivity to the main corridors will be able to reap significant gains: without good roads between the locations of export production, especially agriculture, and the main corridors, uncertainty and the risk of wasting production may prevent producers to export. Domestic market access benefits and localized impacts In addition to its role in international trade, investment in transport corridor infrastructure, especially if combined with the improvement of access roads and ancillary infrastructure and services, can have sizable benefits for domestic market accessibility as well. The development of economic sectors that target promising domestic and sub-regional consumer markets can help spur economic development in the inland regions, increase the economic returns to investment in the North-South corridor infrastructure, and reduce the economic distance between the less and the more prosperous and dynamic sub-national regions. Domestic and sub-regional consumer markets for food – fresh produce as well as processed agricultural goods – are expected to expand greatly due to the increasing urban and middle-income population (largely overlapping). As illustrated in this study, the agricultural crop production potential of the region is estimated to be significantly above the current levels, reaching 12.84 million metric tons worth US$3.19 billion per year in Burkina Faso alone compared to 7.47 million mt (US$2.05 billion) that is currently utilized. The improvement of the sections of the road corridors in scope of this study that are currently in poor condition would not only reduce the costs of bringing this additional potential production to regional and global markets but also reduce travel costs to the main domestic markets. However, as noted earlier, the trunk corridor infrastructure investment must be accompanied by investment in rural access and ancillary facilities like agricultural consolidation and processing centers, to allow agricultural value chains and higher value-added agricultural sectors to prosper. Overall, a key challenge for Burkina Faso and its neighbors is to transform the transport corridors into fully integrated economic corridors, complementing high-quality physical trunk corridor infrastructure and functioning border crossings with well-developed production and logistics chains that allow tapping the full agricultural and manufacturing potential and promote trade with global and sub-regional markets. Increased production and exports in the hinterland, in turn, can contribute to transport cost reductions for imports, by reducing the current stark import-export imbalance and the share of containers returning from inland regions to the maritime ports empty. A necessary part of overall corridor “packages” for promoting agricultural exports from rural areas and manufacturing exports from the cities is the improvement of the access to such areas from the main corridors, for example, in Burkina Faso’s East region that benefits from proximity to the main gateway corridors yet remains underdeveloped due to the sparsity of all-season access roads, among other factors.

59

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Bove, A., O. Hartmann, A. Stokenberga, V. Vesin, and Y. Yedan. (2018). West and Central Africa Trucking competitiveness, SAATP Working Paper No. 108.

Briceño-Garmendia, C. & C. Domínguez-Torres. (2011). Burkina Faso's Infrastructure: a Continental Perspective. AICD Country Report.

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JICA. (2018b). The Project on the Corridor Development for West Africa Growth Ring Master Plan. Final Report Volume 2: Corridor Development Plans. March.

JICA. (2018c). The Project on the Corridor Development for West Africa Growth Ring Master Plan. Final Report Volume 3: Appendices. March.

Lall, S. and M. Lebrand. (2019). Who Wins, Who Loses? Understanding the Spatially Differentiated Effects of the Belt and Road Initiative (English). Policy Research working paper; no. WPS 8806. Washington, D.C.: World Bank Group.

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République Togolaise. (2015). Politique Nationale des Transports pur la Periode 2016-2030. November.

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Roche. (2014). Consultancy services for preparation of a medium-term master plan for transportation on the Volta Lake and its surrounding region.

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Saana Consulting. (2015a). ATWA Stage 1 Report, Part 2 – Corridor Selection. November.

Saana Consulting. (2015b). Accélérer les échanges commerciaux en Afrique de l’Ouest (ATWA) - rapport de la 1ère étape. Résumé. November.

Saana Consulting. (2016). ATWA Stage 2 Report; Part 1 - Corridor Diagnostic. September.

Toebes, K.R. (2017). Pre-feasibility study on an inland water container transport service at Lake Volta, Ghana. MSc Thesis, Delft University of Technology.

UEMOA. (2016). 25e Rapport de l'observatoire des pratiques anormales (OPA). Union Economique et Monetaire Ouest Africaine.

UEMOA. (2017). Importations et activités internes de transport et de logistique : Analyse économétrique sur l’Afrique et évaluation qualitative du corridor Abidjan Ouagadougou. February 13.

UEMOA / JICA / République Togolaise. (2017). Préparation de la réunion du Comité de pilotage du Projet du Plan Directeur de l’Aménagement des Corridors pour l’Anneau de Croissance en Afrique de l’Ouest, Document de synthèse.

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Van Dyck, G.K. & S. A. Domfeh. (2017). Gateway Port Selection Based on Inland Transport Cost and Performance Metrics in West Africa. International Journal of Economics, Commerce and Management, Vol. V, Issue 12. Pp. 589-608.

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West Africa Trade Hub. (2013). Trends in Transport and Logistics on the Tema-Ouagadougou-Bamako corridor.

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World Bank. (2016a). Second Regional Trade Facilitation and Competitiveness Development Policy Operation. Project Appraisal Document. November 14.

World Bank. (2016b). Togo Systematic Country Diagnostic. Washington D.C.

World Bank. (2017). Burkina Faso Systematic Country Diagnostic. Washington D.C.

World Bank. (2017a). Togo Trade and Logistics Services Competitiveness Project. Project Appraisal Document, Washington D.C.

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Zerelli, S. and Cook A. (2010). Trucking to West Africa’s Landlocked Countries: Market Structure and Conduct. West Africa Trade Hub Report #32.

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ANNEX 1: The region’s infrastructure condition

In Burkina Faso, road improvement has taken place in terms of both quantity and quality. The length of the road network has increased from 9,500 km to around 15,272 km, with the classified network consisting of national roads (RN), regional roads (RR), and departmental roads (RD). With a total length of 6,697 km, the national roads connect the main towns of the regions and ensure links with the road networks of border countries; over 50 percent of national roads are asphalted. The regional roads fulfil the function of serving provinces and linking the main provincial towns; only 2 percent of these are paved. Finally, less than 1 percent of the 5,000 km of departmental roads are paved (JICA, 2018b). Ghana has a road network of about 71,000 km, including 14,900 km of trunk roads, 14,000 km of urban roads, and 42,100 km of feeder roads. Only 5 percent of feeder roads are paved, and another 65 percent graveled; according to a 2014 assessment, 14 percent of the trunk roads and 32 percent of the feeder roads were in poor condition. The Sekondi-Takoradi-Kumasi axis was recently rehabilitated, while improvement of the Buipe-Tamale section was finished a few years ago. Remaining hard infrastructure gaps include road connections from agricultural areas to major arterial roads. Inadequate revenues for covering the cost of routine and periodic maintenance presents an issue: the fuel levy for the Road Fund has remained at GHs 0.06 per liter since 2005, eroding its value by more than 50 percent (JICA, 2018b). Togo’s national road network is approximately 11,777 km long, including approximately 2,101 km of paved national roads and 1,473 km of urban roads. About 29 percent of all roads are in good condition, 31 percent are in fair, and 40 percent -- in poor condition (Republique Togolaise, 2018). Road maintenance remains a priority. Efforts to mobilize sustainable resources through SAFER, implementation of road maintenance strategies, and manual maintenance by cantonment have improved the level of service of the national road network. Road tolls and gasoline taxes of 35 FCFA per liter are collected to finance road works; however, the collection level is only 40 percent of the budget plan (JICA, 2018b). Niger’s road network as assessed in 2017 was 20,642 km long, of which 4,640 km were paved. Road density is 323 km/1,000 km2 in the Niamey region and 67.5 km/1,000 km2 in Dosso, but only 2 to 3 km/1,000 km2 in Agadez and Diffa. The Directorate of Road Management maintains a database on the road network condition, which uses a bump integrator on paved roads about every three years. Since 2012, more than 10,800 km of roads have been surveyed using a drive-through mobile application-based technology. The most recent assessment indicates that most of the major corridor sections, such as the Niamey-Burkina Faso border route, are in poor to fair condition, except for some sections near the Nigeria border which are in good condition. The section of the Niamey‐Burkina Faso corridor in Niger (RN6, 120 km) is paved and was last rehabilitated in 2003‐04. Nearly all of the unpaved road network in Niger is in poor condition. The GoN has identified a network of unpaved roads that connect the paved road with the surrounding agricultural areas. A total of 174 km has been identified for improvement, including Kobadje‐Turodi‐Adaje, Malakondi‐Tienga, Malakondi‐Kiki, and Alambaré‐ Gueyne.

ANNEX 2: Economic lagginess and potential of regions within the study area: detailed rankings

Table 2.1: Top 10 regions in terms of Economic Lagginess indicators

Mean night lights intensity, relative units, (2016) Poverty rate, percent (most recent year)

1 Agadez (NG) 0.148 1 Savanes (TO) 90.8

2 Zinder (NG) 0.154 2 Centre (TO) 80.2

3 Dosso (NG) 0.155 3 Upper West (GH) 70.7

4 Maradi (NG) 0.158 4 Nord (BF) 70.4

5 Sahel (BF) 0.166 5 Kara (TO) 68.4

6 Tahoua (NG) 0.168 6 Plateaux (TO) 64.7

7 Tillaberi (NG) 0.187 7 Boucle du Mouhoun (BF) 59.7

8 Centre-Nord (BF) 0.193 8 Maradi (NG) 57.0

9 Diffa (NG) 0.208 9 Tillaberi (NG) 56.0

10 Nord (BF) 0.244 10 Maritime (TO) 53.9

Source: Authors’ assessment based on data from Goodman et al. (2019) and poverty estimates from various sources

62

Figure 2.1: Combined ranking on the Economic Lagginess indicators (higher = more lagging)

Source: Authors’ assessment based on data from Goodman et al. (2019) and poverty estimates from various sources

Table 2.2: Top 10 regions according to the Agglomeration Potential & Economic Dynamism indicators

Change in night lights intensity, percent (2012-16)

Change in population, CAGR (2000-15)

Change in size of urban land, CAGR (1992-2015)

1 Brong Ahafo (GH) 175.0 1 Central (BF) 6.11 1 Center-South (BF) >30.0

2 Volta (GH) 140.2 2 Cascades (BF) 4.84 2 Upper West (GH) 13.48

3 Central (TO) 140.0 3 Diffa (NG) 4.84 3 Center-East (BF) 8.36

4 Northern (GH) 102.3 4 Zinder (NG) 4.75 4 East (BF) 8.01

5 Haut-Bassins (BF) 99.8 5 Tahoua (NG) 4.70 5 Dosso (NG) 7.68

6 Center-West (BF) 98.4 6 Maradi (NG) 3.71 6 North (BF) 7.43

7 Ashanti (GH) 95.9 7 Agadez (NG) 3.69 7 Plateau-Central (BF) 7.40

8 Eastern (GH) 90.1 8 Savanes (TO) 3.40 8 Upper East (GH) 6.76

9 Plateaux (TO) 81.4 9 Haut-Bassins (BF) 3.38 9 Central (GH) 6.73

10 Maritime (TO) 70.3 10 East (BF) 3.34 10 Cascades (BF) 6.55

Source: Authors’ assessment based on data from Goodman et al. (2019)

Figure 2.2: Combined ranking on the Agglomeration Potential & Economic Dynamism indicators (lower = better)

Source: Authors’ assessment based on data from Goodman et al. (2019)

0

10

20

30

40

50

60

Poverty rate %) Mean night light intensity (2016)

0

10

20

30

40

50

60

70

80

Change in night lights (2012-2016) Change in population (2000-2015) Change in urban land (1992-2015)

63

Table 2.3: Top 10 regions according to three of the Agricultural potential indicators

Agricultural production potential of staple crops (sorghum, rice, maize, millet), mt/km2

Agricultural production potential of cash crops, mt/km2

Monetary value of total potential agricultural crop production ($/km2)

1 Upper East (GH) 62.83 1 Central (GH) 150.21 1 Eastern (GH) 85,824

2 Niamey (NG) 60.51 2 Western (GH) 139.55 2 Central (GH) 85,099

3 Haut-Bassins (BF) 54.36 3 Ashanti (GH) 139.52 3 Ashanti (GH) 72,284

4 Maritime (TO) 47.67 4 Eastern (GH) 107.95 4 Western (GH) 60,728

5 Boucle du Mouhoun (BF) 42.57 5 Greater Accra (GH) 79.67 5 Brong Ahafo (GH) 54,383

6 Savanes (TO) 40.24 6/7 Volta (GH) 63.46 6 Volta (GH) 43,923

7 Dosso (NG) 39.42 6/7 Brong Ahafo (GH) 63.46 7 Greater Accra (GH) 40,092

8 Centre-Est (BF) 38.29 8 Maritime (TO) 52.13 8 Upper East (GH) 37,451

9 Plateaux (TO) 36.83 9 Upper East (GH) 37.21 9 Maritime (TO) 36,361

10 Maradi (NG) 33.96 10 Haut-Bassins (BF) 36.77 10 Plateaux (TO) 24,968

Source: Authors’ assessment based on data from Goodman et al. (2019) and estimates produced by IFPRI

Figure 2.3: Harvested area and production volume of major traditional cash crops (2016)

Source: FAOSTAT

Figure 2.4: Combined ranking on the Agricultural potential indicators (lower = better)

Source: Authors’ assessment based on data from Goodman et al. (2019) and estimates produced by IFPRI

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

Cashewnuts

Cocoa Groundnuts

Seed cotton Sesameseed

Cashewnuts

Cocoa Groundnuts

Seed cotton Sesameseed

Area harvested (ha) Production (mt)

Burkina Faso Ghana Niger Togo

- 20 40 60 80

100 120 140 160 180 200 220

Production of staple crops per sq-km Production of cash crops per sq-kmPotential production of staple crops per sq-km Potential production of cash crops per sq-kmMonetary value of total potential production per sq-km Change in the share of cropland (2001-2012)

64

Figure 2.5: Total current agricultural crop production volumes in Burkina Faso at 10 km x 10 km resolution (mt)

Source: Estimated by IFPRI

Figure 2.6: Total potential agricultural crop production volumes in Burkina Faso at 10 km x 10 km resolution (mt)

Source: Estimated by IFPRI

65

Figure 2.7: Total current production of staples (rice, maize, millet, sorghum) in Burkina Faso at 10 km x 10 km resolution (mt)

Source: Estimated by IFPRI

Figure 2.8: Total current value of perishable produce (fruits, vegetables) in Burkina Faso at 10 km x 10 km resolution ($)

Source: Estimated by IFPRI

66

Table 2.4: Top 10 regions according to the Manufacturing potential indicators

Density of primary & secondary road network, km/ 100 km2 Adult (>15 y/o) literacy, percent

1 Niamey (NG) 73.5 1 Greater Accra (GH) 79.1

2 Greater Accra (GH) 29.3 2 Maritime (TO) 66.6

3 Centre (BF) 20.8 3 Centre (BF) 65.2

4 Maritime (TO) 14.0 4 Western (GH) 63.3

5 Central (GH) 10.8 5 Ashanti (GH) 63.1

6 Eastern (GH) 9.3 6 Niamey (NG) 62.4

7 Western (GH) 8.7 7 Eastern (GH) 59.5

8 Ashanti (GH) 8.3 8 Central (GH) 59.4

9 Volta (GH) 7.7 9/10 Volta (GH) 57.8

10 Upper East (GH) 6.3 9/10 Centre (TO) 57.8

Source: Authors’ assessment based on data from OSM and country-specific most recent sources on literacy rates

Figure 2.9: Combined ranking on the Manufacturing potential indicators (lower = better)

Source: Authors’ assessment based on data from Goodman et al. (2019) and estimates produced by IFPRI

-

10

20

30

40

50

60

Density of primary and secondary roads (km/sq-km) Adult (>15) literacy (%)

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Table 2.5: Summary of sub-national region rankings along economic lagginess and potential indicators

Sub-national region

Corridors crossing the sub-national region

Economic lagginess19

(rank; 1=best)

Agricultural potential20 (rank;

1=best)

Manufacturing potential21 (rank;

1=best)

Agglomeration potential22 (rank;

1=best)

Bu

rkin

a F

aso

Boucle du M.

none

25/26 10/11 28 25

Centre-Nord 29 26 20 28/29

Nord 34/35 15 29/30 21/22

Sahel 19 31 31 35/36

Sud-Ouest 17/18 23 22 32

Cascades

Ouagadougou-Abidjan

14 16/17/18 23 1

Centre-Ouest 16 16/17/18 29/30 14

Haut-Bassins 13 2 19 5

Centre-Est Ouagadougou-Lomé 20/21/22 13 25/26/27 11

Centre-Sud Ouagadougou-Tema 17/18 20/21 24 18

Centre All study corridors 2/3 12 2/3 17

Est Ouagadougou-Niamey, Niamey-Lomé eastern route

20/21/22 32 35 2

Plateau-Centr. Ouagadougou-Niamey 25/26 20/21 17 30

Gh

ana

Ashanti

Ouagadougou-Tema

4 19 6/7/8 8

Brong Ahafo 9/10 22 11 4

Eastern 6 8 6/7/8 12

Greater Accra 1 5 1 23

Northern 11 34 21 3

Upper East 9/10 1 12 24

Central

none

5 6/7 6/7/8 6

Upper West 28 25 13/14 9

Volta 7/8 16/17/18 9 13

Western 7/8 24 5 35/36

Nig

er

Agadez

none

23 35 25/26/27 34

Diffa 20/21/22 36 36 28/29

Dosso 34/35 4 16 19/20

Maradi 36 3 25/26/27 19/20

Tahoua 30 33 32 27

Zinder 32 27 34 21/22

Niamey Ouagadougou-Niamey, Niamey-Lomé eastern route

2/3 14 4 26

Tillaberi 33 28 33 31

To

go

Centre

Ouagadougou-Lomé, Niamey-Lomé eastern route

27 30 15 7

Kara 15 29 10 33

Maritime 12 6/7 2/3 16

Plateaux 31 10/11 13/14 15

Savanes 24 9 18 10

ANNEX 3: Ongoing and proposed investments and reform policies

19 Simple average of ranking in terms of: Poverty rate (%); mean nighttime lights intensity in 2016 20 Simple average of ranking in terms of: Production of staple crops per km2 in 2016; production in cash crops per km2 in 2016; potential production of staple crops per km2; potential production of cash crops per km2; monetary value of total potential crop production per km2; change in the share of land area cultivated (2001-12); livestock per km2 21 Simple average of ranking in terms of: Density of primary and secondary roads (km/km2); adult (>15) literacy (%) 22 Simple average of ranking in terms of: Change in mean nighttime lights intensity in 2012-2016 (%); change in population in 2000-2015 (%); change in urban land in 1992-2015 (%)

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Regional The ECOWAS Commission initiated a study to prepare an infrastructure development master plan for ECOWAS for 2015-2030 covering the transport, energy, water and ICT sectors. The draft report of the study proposes priority road projects for a total investment of about US$10.8 billion, including the development of a 2x2 expressway on the Lomé-Ouagadougou corridor (US$2.94 billion) and a 2x2 expressway on the Tema-Ouagadougou route (US$1.15 billion). Among the proposed port investment is the modernization of the port of Tema (US$1.5 billion).23 The total planned capacity of the container berths of the main ports serving the sub-region is more than 10 million TEU, which is 2.5 times the existing. This capacity is 5 times the volume of current handled containers which was 2.0 million TEU in 2014. Although Lomé currently has the largest container berth, the level of container handling capacity and draft will be similar in the near future among the three main ports. According to the present plan, Tema will have the largest container terminal in this sub-region. In addition, San Pédro and Takoradi ports, which have been mainly functioning as export ports for agricultural products and mineral resources, are also trying to expand their container terminal function (JICA, 2018a). The ECOWAS Commission adopted as regional blueprint for transit under PACIR, an EU-supported program. That approach proposes to replace the successive national transit declarations by one covering the entire route, thus eliminating duplicated procedures at the inland borders. Currently, the World Bank is supporting the implementation of the PACIR approach on the Abidjan-Ouagadougou corridor and, once the pilot has been developed and tested, it will be deployed on other corridors. Between Togo and Burkina Faso, JICA supported a slightly different approach on the Lomé-Ouagadougou corridor, with the understanding for the two countries to eventually switch to the PACIR approach. There are also ongoing Bank-financed national technical assistance operations: Burkina Faso Transport Sector Modernization & Corridor Trade Facilitation; and Togo Trade & Logistics Services Competitiveness.

National With World Bank financing, Burkina Faso is planning to rehabilitate several strategic road sections - N20 and N25 near the Ghanaian border; N15 that connects Burkina Faso’s North and Center-North regions; sections of N19 (the main eastern link between Togo and Niger crossing Burkina Faso) – in addition to the refurbishment or development of border post facilities (e.g. between Togo and Burkina Faso at Ponio; and between Burkina Faso and Niger at Kantchari-Torodi), installation of weighbridges at key locations along the corridors to reduce overloading, and the implementation of various “soft” trade facilitation measures. The AfDB’s Road Rehabilitation and Transport Facilitation Project on Lomé-Cinkasse-Ouagadougou Corridor is expected to be completed in 2020. This project is financing the rehabilitation of Atapkame-Blitta road (150km) and the Koupela-Bitou- Togo border road (150 km); the construction of nearly 100 km of feeder roads in both countries, markets, parking and rest areas; and transport facilitation services (cargo tracking system, the automating and streamlining customs procedures, axle load control, etc.). The project expects to achieve a reduction in border crossing time from 2 days to 3 hours; reduction in transit document processing time from 2 days to 2 hours; and reduction in number of checkpoints by 70 percent. There is also an on-going effort through JICA assistance to address the delays at Cinkasse through improved Customs connectivity. The GoT has a policy of development of the arterial crossroads that connect to Ghana and Benin. Road widening from 2 lanes to 4 lanes is ongoing on the Lomé-Tsévie section. Bypass roads to control the through-traffic in urban areas are planned for the cities of Tsévie, Notsé, Atakpamé, Sokodé and Kara (JICA, 2018b). Incentives for the purchase of new trucks were adopted by the GoT in 2016, coupled with measures that limit the age of imported vehicles and encourage transport sector professionalization. Nearly 2,000 km of rural roads are being rehabilitated under the PUDC and 826 km under the program to rehabilitate roads in cotton and coffee/cocoa areas (Republique Togolaise, 2018). As proposed in the National Development Plan 2018-2022, the organization and management of the port of Lomé will be reformed through the creation of a port authority and multimodal dry ports will be developed, among other interventions, in order to achieve the aim of

23 ECOWAS Regional Infrastructures Development Master Plan – Draft Report June 2016. Cited in USAID (2017)

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reducing the average transit time at the port from 72 hours in 2016 to 24 hours in 2022 and increase the volume of containers handled (in TEUs) from 1,193,841 in 2017 to 3,050,000 in 2022. During 2021-2025, the Nigerien government aims to make rural road investments at the rate of 500 km per year. It is therefore planned that an annual investment of 500 x 30 million FCFA/km = 15 billion FCFA will be made, in addition to another 15 percent to finance support for the beneficiary Territorial Communities, i.e. a total of 17.25 billion FCFA (US$29.49 million) per year. The road investment programs are prepared by the DTER according to three scenarios: (a) high priority interventions, generally those concerning asphalt roads and structures; (b) in addition to high priority interventions, the necessary interventions on dirt roads; and (c) all the interventions that are necessary on the entire road network. The government’s target for 2025 is to increase the proportion of paved roads in good condition to 75 percent (from 50 percent in 2015) and the proportion of dirt roads in good condition from to 60percent (from 40 percent in 2015). The GoN plans to create the country’s first dry port in Dosso, with an estimated budget of 7-10 billion FCFA and a target of freight traffic transiting through the dry port at 1 million mt by 2025.This project is being piloted by the Ministry of Transport, which is looking for a private partner to finance and operate the dry port. However, the viability of this project will only be truly assured when it is served by the railway. It is therefore likely that its completion will only be possible after 2020.

ANNEX 4: Data inputs into the spatial economic model and detailed results

Model input data

Figure 4.1. Population residing in each District

Sources: Niger: National Survey on Household / Living Conditions and Agriculture 2014; Burkina Faso: Continuous Multi-sectoral Survey 2014

Figure 4.2. Share of employment in tradable goods sectors (percent of District labor force)

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Sources: Niger: National Survey on Household / Living Conditions and Agriculture 2014; Burkina Faso: Continuous Multi-sectoral Survey 2014

Figure 4.3. Current speeds on main roads in the region

Source: Estimated using road condition data assembled for all countries

Detailed model results

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Table 4.1. Correlations between real income changes and the main factors for Burkina Faso

Scenario 3 Scenario 4 Scenario 5 Scenario 6

(Intercept) -0.59 *** 0.318

0.55

0.54

Change cost 0.45

-1.59 *** -1.54 *** -1.35 ***

Log density 0.08 * 0.04

0.02

0.03

Real wage (current) 0.47 ** 0.34

0.27

0.34

Potential export employment 3.58 *** 3.19 ** 10.35 *** 10.22 ***

Productivity tradables 0.00 * 0.00 * 0.00 * 0.00

Productivity non-tradables -0.72 * -0.34 * -0.59 * -0.88 *

Amenity -0.01 * -0.02 * -0.02 *** -0.02 *

Note: 0 ‘***’ 0.001 ‘**’ 0.01 ‘*’ 0.05. The table presents the results a simple regression to explain changes in income. It shows correlation

coefficients for each of the possible determinant with the outcome of interest.

Table 4.2. Correlations between real income changes and the main factors for Niger

Scenario 1 Scenario 2 Scenario 3 Scenario 4 Scenario 5 Scenario 6

(Intercept) 0.13 0.30 0.22 1.23 2.05 2.08

Change cost -0.12 -0.06 -0.10 -3.79 * -3.70 * -1.37

Log density 0.05 -0.01 0.00 -0.10 -0.10 -0.07

Real wage (current) 0.12 0.05 0.03 0.07 0.07 0.14

Potential export employment

6.26 * 2.82 * 1.92 7.88 15.44 *** 19.37 ***

Productivity tradables 0.00 0.00 0.00 0.00 0.00 0.00

Productivity non-tradables

-0.82 -0.49 -0.34 -1.44 -1.60 -2.13

Amenity 0.01 0.00 0.00 0.00 0.00 0.00

Note: 0 ‘***’ 0.001 ‘**’ 0.01 ‘*’ 0.05. The table presents the results a simple regression to explain changes in income. It shows correlation

coefficients for each of the possible determinant with the outcome of interest.

Figure 4.4: Expected real income change at the District level under Scenario 5 (all transport infrastructure investments +

reduction in transport fixed costs)

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Figure 4.5: Expected real income change at the District level under Scenario 6 (all transport infrastructure investments + reduction in border and port costs)

Source: Authors’ calculations

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ANNEX 5: Detailed results of the spatial accessibility analysis

Table 5.1: Population able to access a major local market within different motorized travel time thresholds

< 30 min 30 min – 1 h 1 – 2 h 2 – 3 h 3 – 4 h 4 – 5 h 5 – 6 h Over 6 h

Baseline 3,485,048 1,502,151 4,315,333 4,085,349 1,927,056 1,136,387 587,310 346,461

Scenario 1 3,485,048 1,502,151 4,315,333 4,087,241 1,931,077 1,149,360 574,116 340,768

Scenario 2 3,485,048 1,503,451 4,317,408 4,092,310 1,980,284 1,125,487 553,369 327,736

Scenario 3 3,497,919 1,537,378 4,343,209 4,034,110 1,969,838 1,122,496 552,408 327,736

Scenario 4 3,485,048 1,502,151 4,315,892 4,118,406 1,895,640 1,137,204 584,293 346,461

Source: Authors’ assessment based on road condition data assembled from various sources and World Pop (2014) population raster data

Table 5.2: Total agricultural production volume that can be transported to a major local market within different motorized travel time thresholds (mt)

< 30 min 30 min – 1 h 1 – 2 h 2 – 3 h 3 – 4 h 4 – 5 h 5 – 6 h Over 6 h

Baseline – current 212,295 769,190 2,434,719 2,169,208 907,170 574,972 230,523 51,357

Baseline – potential 336,582 1,293,446 4,131,253 3,727,415 1,566,591 1,046,356 439,492 88,931

Scenario 1 – current 212,295 769,190 2,434,719 2,169,208 907,170 582,713 224,713 49,425

Scenario 1 – potential 336,582 1,293,446 4,131,253 3,727,415 1,566,591 1,062,325 427,537 84,916

Scenario 2 – current 212,295 769,190 2,434,719 2,170,096 952,842 555,825 208,083 46,383

Scenario 2 – potential 336,582 1,293,446 4,131,253 3,729,152 1,657,917 1,010,605 392,305 78,806

Scenario 3 – current 215,158 785,816 2,447,125 2,145,762 952,913 548,193 208,083 46,383

Scenario 3 – potential 340,901 1,323,467 4,148,842 3,688,546 1,656,722 1,000,475 392,305 78,806

Scenario 4 – current 212,295 769,190 2,434,719 2,173,226 903,761 577,434 227,451 51,357

Scenario 4 – potential 336,582 1,293,446 4,131,253 3,732,905 1,561,747 1,051,515 433,686 88,931

Source: Authors’ assessment based on road condition data assembled from various sources, OSM data on locations of urban areas, and agricultural production estimates produced by IFPRI