CHAPTER FOUR: ECONOMIC GOVERNANCE AND MANAGEMENT __________________________________________________________________________ 386. Situation of public finance. It should be noted that the performance of the taxation services has suffered over the past five years from an upsurge in fraud through the under-evaluation of imports and the abusive granting of exemptions, and from the slowdown in economic activities following the restriction of re-exports to Nigeria. In order to increase tax revenue, the government is implementing an extensive programme to collect revenue and broaden the tax base. 387. External sector. The two main factors that weakened the country’s external position in the period from 2000 to 2005 were the decline in cotton production and unfavourable trends in cotton prices. Furthermore, the rise of the euro against the US dollar favoured the over-valuation of the CFA franc, thereby reducing the competitiveness of Benin’s cotton. These difficulties were compounded by increases in oil prices and a decline in public transfers from re-export operations. Consequently, the current account deficit (excluding grants) stood at 7.2% of GDP in 2004. The deficit improved slightly to 6.4% of GDP in 2005 as a result of improvements in the balance of payments. 142