the existence, timing, as well as the significance of breaks in mean growth rates.<sup>3</sup> Econometric tests identified a break in WAEMU’s GDP growth in 2011 (Annex Figure 3).<sup>4</sup> This reflects the fact that growth surged from an average of 3.1 percent in 2000-2010 to 6.4 percent in 2011-2017. This includes the rapid growth turnaround in Côte d’Ivoire, from less than a half percent to over 9 percent over this period. Similarly, Senegal, Togo, and Mali experienced a statistically significant shift in their growth paths. Niger, Benin and Guinea-Bissau maintained solid growth rates although no structural breaks were identified.

The services sector led growth in most WAEMU countries, followed by agriculture in some economies and by industry in others. The services sector accounts for the largest portion of year-onyear variations in real GDP growth in Benin, Côte d’Ivoire, Mali, and Senegal (Annex Figure 4). Fast-growing sectors, such as finance, transport and communications have underpinned the rapid expansion in services. Industry contributed strongly in some counties (Benin, Burkina Faso, Senegal) mainly reflecting construction booms linked to infrastructure investment. Agriculture has made a significant contribution in Guinea-Bissau, Mali, and Togo. However, in some countries (including Benin, Burkina Faso, and Senegal), the growth contribution of agriculture declined, despite the sector’s prominent role in the 2000s (excluding drought years).

Recent growth can be traced to increased capital accumulation while TFP growth has generally made a modest contribution. Growth can occur either due to the use of increased amounts of factors of production or a more efficient combination of resources to produce more output for a given input level. Annex Figure 6 decomposes growth into three sources: capital accumulation, labor supply, and TFP growth. Three-fourths of growth in WAEMU was due to factor accumulation, while the rest was accounted for by TFP growth. This is broadly similar to the SSA experience, but SSA, on average, experienced negative TFP growth over 2011-2016. Capital accumulation explains at least 40 percent of GDP growth in WAEMU economies, except for Côte d’Ivoire and Guinea-Bissau. Total investment increased from about 15 percent of GDP in 2000-2010 to 20 percent in 2011-2016 with two-thirds of this increase coming from the private sector. TFP growth played a significant role only in Côte d’Ivoire, reflecting recovery from the productivity loss during the decade-long political crisis that took a heavy toll on the economy.

Glanced through a structural transformation lens, growth was driven by static structural change and within-sector productivity growth.<sup>5</sup> Productivity growth occurs either due to improvements within sectors or resource reallocation from low to high-productivity activities. Annex Figure 7 decomposes GDP per capita growth into within-sector changes and structural change (as well as the static and dynamic subcomponents). In Senegal and Benin, ‘within’ gains accounted for the bulk of per capita growth, although static structural change made a significant contribution. Unlike 2005-10, the contribution of within-sector productivity changes to Benin’s growth turned negative in 2010-15. Structural changed played a substantial positive role in Burkina Faso, while a decline in within-sector productivity and lower employment held back growth. Similarly, a third of Côte d’Ivoire’s growth in recent years was due to structural change (Haile, 2018). WAEMU trends are thus consistent with those of Sub-Saharan Africa (Timmer _et al_ ., 2014).

> 3We follow the definitions of Hausmann _et al_ . (2005): (a) a growth acceleration should be sustained for at least 5 years and the change in growth rate has to be at least 2 ppts; (b) a country can have more than one instance of growth acceleration as long as the dates are more than 5 years apart; (c) trend breaks were selected at the 1% level of significance (α = 0.01) in the _Autometrics_ options in the software package OxMetrics 7 (Doornik _et al_ ., 2013). The results are robust to changes in these specifications.

> 4 Annex Figure 7 presents growth trends only for countries that have experienced significant shifts in mean growth rates. 5Static effects refer to productivity changes due to reallocation of workers from below- to above-average productivity _level_ sectors; dynamic effects refer to productivity growth arising from labor shift from below- to above-average productivity _growth_ sectors.

4