10021350-Lot 2: Support for employment promotion structures to improve employment support services

Benin's economy is experiencing sustained economic growth, with real GDP growth estimated at around 6.4 % in 2023 and projected to remain above 6 % over the coming years. However, this growth has not translated into sufficient decent employment opportunities for the majority of the population. Micro, small and medium-sized enterprises (MSMEs), which represent more than 95 % of registered enterprises, continue to face structural constraints including low productivity, weak integration into markets and value chains, limited access to finance and skilled labour, insufficient digitalisation, and inadequate business support services.

Women-led enterprises and enterprises located in northern regions are particularly affected by these challenges. The Government of Benin has adopted several national strategies to strengthen economic productivity, employment promotion and SME competitiveness, including the National Development Plan 2018-2025, the national SME promotion strategy, the national employment policy and the "Benin Alafia 2060" vision. In parallel, the country aims to strengthen labour market governance through improved labour market information systems and territorial employment promotion approaches.

The Federal Republic of Germany supports Benin in the implementation of these reforms through, among others, the project "Employment-oriented promotion of the competitiveness of micro, small and medium-sized enterprises" (ProPME 2). The project aims to improve the competitiveness of MSMEs in selected sectors and regions with a positive impact on employment. It focuses on the food processing industry, renewable energies, crafts and services sectors, as well as employment promotion and labour market intermediation.

The module is structured around three main outputs: Output 1 aims to strengthen the competitiveness and growth capacities of MSMEs through tailored support, coaching and training measures. Output 2 aims to improve framework conditions for MSMEs through strengthened cooperation mechanisms, institutional support and public-private dialogue. Output 3 aims to improve the conditions for the placement of qualified workers in MSMEs through strengthened employment governance, labour market intermediation and labour market information systems.