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International Monetary Fund. African Dept.
This 2019 Article IV Consultation with the Democratic Republic of the Congo (DRC) highlights that real gross domestic growth reached 5.8 percent in 2018, buoyed by stronger copper and cobalt prices and increased production. The main risks include an escalation of the Ebola epidemic; fiscal loosening leading to monetization of budget deficits; a relapse in copper and cobalt prices; an intensification of ongoing armed conflicts; and resistance to reform from vested interests. Transparency and accountability in the management of natural resources are major challenges facing DRC. It is recommended to step-up revenue mobilization, notably by simplifying taxes and integrating mining revenue into the central government Treasury. It is also important to enhance transparency, including through public tendering for the sale of mining assets, publication of audited financial statements of state-owned enterprises, and greater monitoring of public assets.
International Monetary Fund. African Dept.

This 2015 Article IV Consultation highlights that the Democratic Republic of the Congo's macroeconomic performance remained strong through the first half of 2015 despite a difficult external and domestic environment. Real GDP growth in 2014 is estimated at 9.2 percent, driven by copper production and the service sector. The medium-term outlook is favorable but subject to downside risks. Real GDP growth is projected to remain strong at 9.2 percent in 2015-among the highest rates in the world-and average 8.4 percent in 2016-17 before stabilizing at about 6 percent in 2018-20.

International Monetary Fund. African Dept.
This 2015 Article IV Consultation highlights that the Democratic Republic of the Congo’s macroeconomic performance remained strong through the first half of 2015 despite a difficult external and domestic environment. Real GDP growth in 2014 is estimated at 9.2 percent, driven by copper production and the service sector. The medium-term outlook is favorable but subject to downside risks. Real GDP growth is projected to remain strong at 9.2 percent in 2015—among the highest rates in the world—and average 8.4 percent in 2016–17 before stabilizing at about 6 percent in 2018–20.
International Monetary Fund. African Dept.

The Republic of Congo has been hit hard by the oil price shock. Fiscal and current account balances deteriorated in 2014 reflecting increased government spending and lower oil prices. Corrective measures are now being taken. Private sector activity is held back by infrastructure gaps, a difficult business climate, and a shallow financial system. Growth and spending have yet to translate into significant reductions in poverty and progress in this area lags peers. Persistent inequality could be a source of instability.

International Monetary Fund. African Dept.
Contexte et perspectives : Malgré de solides performances macroéconomiques réalisées par la République Démocratique du Congo (RDC) entre 2009 et 2012 dans la cadre du programme appuyé par le Fonds monétaire international (FMI) comme l’attestent l’accélération régulière de la croissance et une forte baisse de l’inflation, la pauvreté demeure généralisée et l’économie vulnérable aux chocs, autant de facteurs qui pourraient remettre en cause les progrès accomplis. L’étroitesse de l’espace budgétaire dans un contexte d’ajustement des dépenses aux chocs sur les recettes n’ont pas toujours permis de faire face aux dépenses de lutte contre la pauvreté ou aux investissements en faveur des infrastructures de base qui sont pourtant indispensables pour impulser une croissance inclusive. Thèmes des consultations : Les entretiens ont porté sur les politiques à moyen terme pour (i) préserver la stabilité macroéconomique tout en favorisant une croissance inclusive ; (ii) améliorer la transparence et la bonne gouvernance dans le secteur des industries extractives et (iii) promouvoir la stabilité et le développement du secteur financier. Principales recommandations : • Poursuivre la politique d’ancrage budgétaire adoptée en 2009 consistant à éviter tout financement du déficit par la Banque centrale du Congo (BCC) tout en créant de l’espace budgétaire grâce à une meilleure mobilisation des recettes intérieures et l’amélioration de la qualité de la dépense publique à travers la réforme de la gestion des finances publiques (GFP) ; et renforçant les tampons contre les chocs extérieurs. • Mettre en œuvre les mesures énoncées dans la matrice de la gouvernance économique élaborée avec la Banque mondiale ainsi que les recommandations formulées non seulement dans le cadre de l’Initiative pour la transparence des industries extractives (ITIE) mais aussi par la Conférence de Lubumbashi sur la bonne gouvernance et la transparence dans le secteur minier, afin de renforcer la transparence et la bonne gouvernance dans la gestion des ressources naturelles. • Accélérer la réforme de la BCC et du secteur financier : (i) en adoptant la loi sur les statuts de la banque centrale afin de renforcer son indépendance et sa gouvernance ; (ii) en achevant sa recapitalisation ; (iii) en améliorant ses capacités d’analyse ; (iv) en poursuivant le désengagement de ses missions non essentielles et (v) en appliquant les recommandations du Programme d’évaluation du secteur financier (PESF) afin de promouvoir la stabilité et le développement du secteur financier.
International Monetary Fund. African Dept.

KEY ISSUESContext and outlook: Despite strong macroeconomic performance under the Fund- supported program (2009�12) with economic activity steadily accelerating and inflation declining sharply, poverty remains pervasive and the economy vulnerable, exposing this progress to reversal. Limited fiscal space and shocks to revenues often offset by expenditure adjustments have not supported pro-poor and critical investment spending necessary for inclusive growth, giving rise to mounting social demands to share in the benefits of the accelerating growth.Focus of consultation: The discussions focused on medium-term policy measures to preserve macroeconomic stability while promoting inclusive growth, improve transparency and good governance in the natural resources sector; and foster financial stability and development.Key policy recommendations:� Maintain the fiscal anchor of no (net) central bank financing of the budget while creating fiscal space through enhanced domestic revenue mobilization, and improving the quality of public spending through public financial management (PFM) reforms, and building more robust buffers against external shocks.� Implement measures included in the updated governance matrix agreed with the World Bank and the recommendations of the Extractive Industries Transparency Initiative (EITI) and the National Conference on Mineral Resources Management (NCMRM) to enhance transparency and good governance in the management of natural resources.� Accelerate reforms of the Central Bank of the Congo (BCC) and the financial sector by (i) passing the central bank law to strengthen its independence and governance,(ii) completing its recapitalization, and (iii) strengthening its analytical capacity,(iv) disengaging from non-core activities, and (v) implement FSAP recommendations to promote financial sector stability and development.

International Monetary Fund. African Dept.

KEY ISSUESEconomic context. Growth has been strong, inflation low, and fiscal buffers and international reserves adequate. However, poverty and unemployment remain high, despite large government spending financed from oil revenue. The business climate is among the most challenging and the private credit-to-GDP ratio among the lowest in sub-Saharan Africa (SSA).Outlook and Risks. The economy is projected to expand by about 6 percent per annum between 2014 and 2019, as new oil fields come on stream and an ambitious public investment program is implemented to diversify the economy and make growth more inclusive. Oil production is expected to peak in 2017. The medium-term outlook for non-oil growth and poverty reduction hinges on progress addressing deep-seated structural weaknesses and fiscal adjustment. Risks to the outlook relate to oil price volatility and political instability.Policies. Macroeconomic policies should focus on meeting the economy’s social and development needs while mitigating risks to macroeconomic stability in the longer term.• The growth of government spending should be arrested and the 2014 budget should not be exceeded. Amid spending pressures related to the 2015 Africa Games and the 2016 presidential elections, new fiscal developments should be reflected in a supplementary budget in 2014 to enhance transparency.• In view of the limited remaining lifetime of oil reserves, a gradual fiscal consolidation should be targeted over the medium-term to safeguard fiscal and debt sustainability. Ongoing efforts to address implementation and absorptive capacity constraints need to be stepped up to maximize the benefits from public investments.• Consideration should be given to adopt the non-oil primary balance as the fiscal anchor.• The private sector’s supply response to public infrastructure spending should be maximized through implementation of reforms to improve the business climate, support private investment, and develop the financial sector.• The pilot project for cash transfers should be well-targeted and monitored to reduce poverty.• Compliance with reserves pooling requirements would insure the continued smooth operation of the BEAC and the exchange rate peg, which both continue to serve theRepublic of Congo well.

International Monetary Fund. African Dept.

Economic performance in the Democratic Republic of the Congo (DRC) has improved markedly. To safeguard the fiscal position, the government has to rigorously monitor budget execution and reduce nondiscretionary spending. The current monetary and floating exchange rate regime should be maintained. Recent efforts to shore up financial stability and develop the banking sector give opportunities for closer regional and global financial integration. Institutional weaknesses, the business environment, and establishing a strong foundation for the exploitation and development of DRC’s natural resources will be critical.