Country Risk Rating

A high-risk political and economic situation and an often very difficult business environment can have a very significant impact on corporate payment behavior. Corporate default probability is very high. - Source: Coface

Business Climate Rating

The highest possible risk in terms of business climate. Due to a lack of available financial information and an unpredictable legal system, doing business in this country is extremely difficult.


  • Subsoil wealth (rare earth, nickel)
  • Potential gains in agricultural productivity


  • Fragile political institutions in a country marked by ethnic conflicts and military regimes
  • Widespread extreme poverty
  • High risk on debt and external accounts
  • Dependence on international aid and the recent end of diplomatic isolation
  • Landlocked and lacking infrastructure
  • Lack of diversification and subsistence agriculture
  • Corruption and ineffective macroeconomic policy

Current Trends


Like neighboring Rwanda, Burundi is one of Africa's most densely populated countries (440 inhabitants/km²). Having doubled in the last 20 years, the population faces youth unemployment (13.3% in 2020), especially in the cities, and a drop in nominal GDP per capita since 2015 (USD 237 in 2021, the lowest in the world). Subsistence agriculture, about a third of GDP and 80% of employment, is characterized by low productivity and a significant economic share. Commodities constitute the bulk of exports: gold (29% in 2020), coffee (19%), and tea (13%). In the short-term, diversification would be based on metals, knowing that the weakness of investments will not allow the aforementioned phenomena to be curbed. The purchasing power of Burundians should stabilize in the medium term after a deterioration due initially to international sanctions (2015-2021) to which the pandemic and then the war in Ukraine were added. There are risks on the horizon for 2023, notably an inflationary spiral, a local recovery of COVID-19, and weak global demand weighing on commodity prices, indirectly affecting investor confidence.

The authorities rely heavily on a mining boom, especially in nickel and rare piles of earth, to generate foreign exchange royalties. In March 2022, a USD 15 billion Memorandum of Understanding was signed with the East African Region Project Group for a 10-year nickel operation. The government hopes to finance 40% of additional expenditure with it. To enable transport out of the country, an agreement was reached in January 2022 with Tanzania, a natural maritime window, for a 282 km rail line, backed by World Bank funding of USD 120 million in September 2022. However, the general development of the extractive sector has been suspended since 2021 until the publication of a new mining code (more favorable to the state), a first draft rejected in March 2022. The National Development Plan 2018-2027 has yet to progress due to the lack of financial resources. However, manufacturing production is expected to increase in the medium term, driven by a policy of import substitution for cement and fertilizers and credit for agri-food production. Hydroelectric dams and solar power plants are under construction, and the AfDB should support financing the interconnected distribution networks.



Burundi was subject to international financial sanctions from 2015 to 2021 following the controversial re-election of the incumbent President to a third term against the 2001 Arusha peace accords. The normalization of external relations has been necessary as financing the current account deficit has proved difficult, despite the reduction of imports and the continuation of humanitarian project aid. The Burundian franc depreciated steadily on the parallel market until 2021, offering a 62.5% premium in June 2022 over the official exchange rate. Foreign exchange reserves equivalent to two months of imports in 2021 could not serve as a buffer. Budgetary aid from the EU, the US, and the AfDB resumed in 2022, accompanied by an increase in project aid, closing a difficult parenthesis concerning the financing of budgetary and current account deficits. FDI flows remain extremely low (USD 8 million), with investors deterred by regulatory uncertainty, weak infrastructure, and political fragility. The structurally negative current account balance reflects the absence of manufacturing and energy resources. The primary income surplus from expatriate remittances needs to be increased to balance the current account deficit.

Consultations with the IMF were concluded in July 2022. However, no funded program is envisaged in 2023. Since 2015, the budget deficit has been growing, mainly financed by borrowing from the local banking system, which reduces the financing available to the private sector. Taxation has increased by 10-15% of GDP between 2015 and 2021, partially offsetting the sharp reduction in development aid, and is expected to continue to rise. The stock of accumulated debt and deficits is still projected to considerably pose a severe risk to debt sustainability, coupled with systemic risk to the local banking sector, which is highly exposed to the national public debt. Under pressure from a high deficit, this debt will remain at a high level in 2023, financed exclusively by domestic financial markets. The debt structure will change in line with this trend: in 2021, 20% of GDP will be external, including 12% multilateral, 48% internal, 15% from the central bank, and 29% from commercial banks.



President Evariste Ndayishimiye is seeking to assert his authority. He dismissed his Prime Minister in September 2022, raising the specter of sedition in a country marked by coups. The ruling party continues to behave as a single party, with a youth movement and intelligence to carry out abuses against opponents. Burundi is still haunted by the civil war (1993-2005), marked by a bloody transition of power (an estimated 300,000 deaths) from the Tutsi ethnic group to the Hutu majority. A truth and reconciliation commission set up in 2014 continues to work on the inter-community massacres since independence in 1962. Still, academics denounce a divisive instrumentalization following a report on the exactions of the Tutsi government in 1972 published at the end of 2021. Deprived of civic space, the man in the street retains a distrustful and distant attitude towards institutions, as shown by the low level of vaccination (around 1% at the end of July 2022), with the lack of medical equipment eroding the effectiveness of the campaign.

After Pierre Nkurunziza decided not to seek re-election in 2020 under pressure from sanctions, the new President has endeavored to resume contact with the outside world. He is breaking with his predecessor, notably by initiating vaccination against Coronavirus-19, supported by a US$76 million rapid credit facility disbursed by the IMF in October 2021 to mitigate the effects of inflation. While the EU and the US lifted their financial sanctions in early 2022 in response to Gitega's goodwill gestures, they remain vigilant in the face of gross and recurrent human rights violations. In addition, the executive is renewing contact with neighboring Rwanda, with which relations had soured from 2015 onwards against a backdrop of interference by Kigali (support for the aborted coup d'état, border attack in 2019). The border between the two countries reopened in November 2022. Also, Burundian armed forces participated in a "regional force" deployed by the East African Community in September 2022 in the eastern DRC. China is an important partner, the country's leading supplier, particularly electronics and machinery.


Coface (02/2023)