Between 2000 and 2005 infrastructuremade an important contribution of 1.6 percentage point toBenin's improved per capita growth performance, whichwas the highest among West African countries during theperiod. Raising the country's infrastructure endowmentto that of the region's middle-income countries couldboost annual growth by about 3.2 percentage points. Beninhas made significant progress in some areas of itsinfrastructure. The rural road network is in relatively goodcondition, and about 30 percent of the rural population hasaccess to an all-season road, a level above thecountry's peers. Air transport connectivity hasimproved. Also, important market liberalization reformsdesigned to attract private capital to the water andinformation and communications technology (ICT) sectors haveboosted performance. In particular, increased competition inthe ICT market has contributed to the rapid expansion ofmobile and Internet services. Addressing Benin'sinfrastructure challenges will require sustainedexpenditures of $712 million per year over the next decade,with heavy emphasis on capital expenditure. Almost half ofthe total relates to the transport sector. At 16.6 percentof Benin's 2005 gross domestic product (GDP), thiseffort is almost at the level of other Sub-Saharan Africancountries. Benin already spends around $452 million per yearon infrastructure, equivalent to about 10.5 percent of itsGDP. Almost $101 million a year is lost to inefficiencies ofvarious kinds, associated mainly with under pricing in thepower and water sectors; poor financial management ofutilities; and inefficient allocation of resources acrosssectors. If Benin could raise tariffs to cost-recoverylevels, and reduce operational inefficiencies in line withreasonable developing-country benchmarks, it couldsubstantially boost flows to the infrastructure sectors.Comparing spending needs with existing spending andpotential efficiency gains (and assuming that theinefficiencies are fully captured) leaves an annual fundinggap of $210 million per year. By far the largest share ofthe gap can be traced to the water supply and sanitationsectors. Benin has the potential to close this gap byadopting alternative technologies in water supply, transportand power. Savings from alternative technologies couldamount to as much as $227 million per year.