Abstract
2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for the Democratic Republic of the Congo
Relations with the IMF
As of May 31, 2019 Membership Status: Joined September 28, 1963; Article VIII
| General Resources Account: | SDR Million | Percent of Quota |
|---|---|---|
| Quota | 1,066.00 | 100.00 |
| Fund holdings of currency | 1,066.00 | 100.00 |
| General Resources Account: | SDR Million | Percent of Quota |
|---|---|---|
| Quota | 1,066.00 | 100.00 |
| Fund holdings of currency | 1,066.00 | 100.00 |
| SDR Department: | SDR Million | Percent of Quota |
|---|---|---|
| Net cumulative allocation | 510.86 | 100.0 |
| Holdings | 20.59 | 4.03 |
| SDR Department: | SDR Million | Percent of Quota |
|---|---|---|
| Net cumulative allocation | 510.86 | 100.0 |
| Holdings | 20.59 | 4.03 |
| Outstanding Purchases and Loans: | SDR Million | Percent of Quota |
|---|---|---|
| ECF Arrangement | 64.34 | 6.04 |
| Outstanding Purchases and Loans: | SDR Million | Percent of Quota |
|---|---|---|
| ECF Arrangement | 64.34 | 6.04 |
Latest Financial Arrangements:
Projected Payments to Fund:3 (SDR million; based on existing use of resources and present holdings of SDRs):
| Forthcoming | |||||
|---|---|---|---|---|---|
| 2019 | 2020 | 2021 | 2022 | 2023 | |
| Principal | 24.75 | 29.70 | 9.90 | ||
| Charges/interest | 2.75 | 5.45 | 5.45 | 5.45 | 5.45 |
| Total | 27.50 | 35.15 | 15.35 | 5.45 | 5.45 |
| Forthcoming | |||||
|---|---|---|---|---|---|
| 2019 | 2020 | 2021 | 2022 | 2023 | |
| Principal | 24.75 | 29.70 | 9.90 | ||
| Charges/interest | 2.75 | 5.45 | 5.45 | 5.45 | 5.45 |
| Total | 27.50 | 35.15 | 15.35 | 5.45 | 5.45 |
| Implementation of HIPC Initiative: | |||
| I. Commitment of HIPC assistance | Enhanced Framework | ||
| Decision point date | July 2003 | ||
| Assistance committed by all creditors (US$ millions)4 | 7,252.00 | ||
| Of which: IMF assistance (US$ millions) | 391.60 | ||
| (SDR equivalent millions) | 280.30 | ||
| Completion point date | July 2010 | ||
| II. Disbursement of IMF assistance (SDR millions) | |||
| Assistance disbursed to the member | 280.30 | ||
| Interim assistance | 49.05 | ||
| Completion point balance | 231.25 | ||
| Additional disbursement of interest income5 | 50.44 | ||
| Total disbursements | 330.74 | ||
| Implementation of MDRI Assistance: | |||
| I. MDRI-eligible debt (SDR Million)6 | 248.08 | ||
| Financed by: MDRI Trust | 0.00 | ||
| Remaining HIPC resources | 248.08 | ||
| II. Debt Relief by Facility (SDR Million) | |||
| Implementation of HIPC Initiative: | |||
| I. Commitment of HIPC assistance | Enhanced Framework | ||
| Decision point date | July 2003 | ||
| Assistance committed by all creditors (US$ millions)4 | 7,252.00 | ||
| Of which: IMF assistance (US$ millions) | 391.60 | ||
| (SDR equivalent millions) | 280.30 | ||
| Completion point date | July 2010 | ||
| II. Disbursement of IMF assistance (SDR millions) | |||
| Assistance disbursed to the member | 280.30 | ||
| Interim assistance | 49.05 | ||
| Completion point balance | 231.25 | ||
| Additional disbursement of interest income5 | 50.44 | ||
| Total disbursements | 330.74 | ||
| Implementation of MDRI Assistance: | |||
| I. MDRI-eligible debt (SDR Million)6 | 248.08 | ||
| Financed by: MDRI Trust | 0.00 | ||
| Remaining HIPC resources | 248.08 | ||
| II. Debt Relief by Facility (SDR Million) | |||
| Eligible Debt | |||
| Delivery Date | GRA | PRGT | Total |
| July 2010 | N/A | 248.08 | 248.08 |
| Eligible Debt | |||
| Delivery Date | GRA | PRGT | Total |
| July 2010 | N/A | 248.08 | 248.08 |
Exchange Rate Arrangement:
The currency of the Democratic Republic of the Congo (DRC) is the Congo franc (CDF). The de jure exchange rate arrangement is floating, although the Fund classifies the de facto exchange rate arrangement as “stabilized.” At end-March 2019, the rate was US$1=CF 1639.0. Effective February 10, 2003, the DRC accepted the obligations of Article VIII, Sections 2 (a) 3, and 4, of the Fund’s Articles of Agreement. However, the DRC maintains one exchange rate restriction subject to Fund approval arising from an outstanding net debt position against other contracting members under the inoperative regional payments’ agreement with the Economic Community of the Great Lakes Countries.
Last Article IV Consultation:
The last Article IV consultation was concluded by the Executive Board on September 11, 2015.
Safeguards Assessment:
An updated safeguards assessment of the Banque Centrale du Congo (BCC) completed in April 2010 found that while most of the 2008 recommendations had been implemented, significant risks remained. The BCC continued to lack autonomy from the government and was in need of recapitalization, and the absence of an independently defined financial reporting framework continued to impair transparency. The Ministry of Finance completed the first phase of the recapitalization in March 2011 by bringing the BCC’s net worth to zero. The IMF has been providing technical assistance to support the recapitalization efforts. While the BCC committed to adopt IFRS as its financial reporting framework in 2003, the transition process has been significantly delayed. The BCC Law was amended in December 2018 with changes in the provisions on independence, autonomy, and transparency.
Resident Representative: Mr. Philippe Egoumé Bossogo assumed his duties in September 2018.
Relations with Other Financial Institutions
A. World Bank
https://www.worldbank.org/en/country/drc/overview
World Bank Group Projects: http://projects.worldbank.org/search?lang=en&searchTerm=&countrycode_exact=ZR
B. African Development Bank
Statistical Issues
| I. Assessment of Data Adequacy for Surveillance |
| General: Data provision to the Fund has some shortcomings but is broadly adequate for surveillance and program monitoring purposes. Upgrades to the national accounts, balance of payments, and government finance statistics would be helpful. In spite of difficulties, the authorities have continued to produce an array of economic and financial statistics, most of which are published in the annual report of the Central Bank of the Congo (BCC) or its monthly statistical bulletin. |
| National accounts: Annual national accounts (ANA) are compiled in constant and current prices by National Institute of Statistics (INS) under the Ministry of Plan with the technical assistance (TA) from IMF/AFC. The compilation methodology has then changed since 2006 with the use of ERETES software and the compilation of definitive ANA for 2005 and 2006 in compliance with the System of National Accounts 1993 (1993 SNA) (implying an upward revision of GDP by about 60 percent). The insufficient human resources pushed the authorities of INS to temporary suspend the use of the ERETES software. With technical assistance from AFC the INS has compiled ANA for 2016 and 2017. |
| Price statistics: Consumer price indices (CPI) are calculated for Kinshasa by the INS, the BCC, the Institute of Economic and Social Research (IESR), and the Economics Section of the U.S. Embassy in Kinshasa. In 2011, the INS started to compile CPI data Country wide using weights calculated on the basis of the 2005 household survey. Prices are collected in the 11 provinces (the BCC in 2013 began the compilation of a similar CPI using a slightly different basket and different weights and based on prices in 5 provinces). |
| Government finance statistics: The BCC produces aggregated monthly statistics on a cash basis based on its own accounting for the government cash operations. The treasury produces two sets of monthly statistics based on its own records: one relates to the transactions executed through the BCC, the other set attempts to consolidate operations through commercial bank accounts and off-budget operations. These statistics do not rely on an integrated double-entry public accounting system and do not provide sufficient details about the nature of expenditures owing to problems in the expenditure chain. However, the treasury has started to produce quarterly expenditure data reports by ministry and institution. The current work on tax administration and expenditure control, as well as the ongoing implementation of the new public accounts framework are expected to improve the quality and timeliness of fiscal statistics. The authorities also benefit from continued technical assistance in GFS under AFRITAC Central. The treasury compiled provisional annual data for the budgetary central government for 2017 and 2018 in line with international standards, but these data have not yet been disseminated. The DRC reported annual data up to 2010 for the IMF’s Government Finance Statistics Yearbook in the format of the Government Finance Statistics Manual 2001 but has not reported subsequently. However, work is underway to resume submission of data to the GFSY, beginning with data for 2012–2016, which have already been validated at the national level. |
| Monetary statistics: Monthly monetary and financial statistics (MFS) covering the central bank and other depository corporations are compiled and reported to the Fund by the BCC in the format of standardized report forms. The depository corporation survey does not include data from non-bank deposit taking institutions, a growing sector in the country. DRC has not reported data to the Financial Access Survey (FAS) since 2015. Until 2015, DRC reported some data and indicators of the FAS, including the two indicators adopted by the UN to monitor Target 8.10 of the Sustainable Development Goals (SDGs). Financial Soundness Indicators (FSIs): DRC does not report FSIs for publication on the IMF website. A technical assistance mission is scheduled in 2019 to assist the authorities in their efforts to develop a set of core and encouraged FSIs for deposit taking institutions. Balance of payments: The Central Bank of the Democratic Republic of Congo has continued its efforts to improve ESS. It is now compiling ESS using the BPM6 methodology from the data-collection phase to the compilation and dissemination phases, as supported by technical assistance under the JSA/IMF Project to Improve External Sector Statistics in 17 Selected African Countries in Francophone Africa. BOP and IIP data up to 2018 are available in IFS. Direct investment is the main weakness because of the very large amounts of transactions in this category, both for the financial account and for the income account. A register and surveys of direct investment enterprises must be established. |
| II. Data Standards and Quality |
| Since April 24, 2004, the DRC participates in the Enhanced General Data Dissemination System (e-GDDS). The metadata needs to be updated. |
| I. Assessment of Data Adequacy for Surveillance |
| General: Data provision to the Fund has some shortcomings but is broadly adequate for surveillance and program monitoring purposes. Upgrades to the national accounts, balance of payments, and government finance statistics would be helpful. In spite of difficulties, the authorities have continued to produce an array of economic and financial statistics, most of which are published in the annual report of the Central Bank of the Congo (BCC) or its monthly statistical bulletin. |
| National accounts: Annual national accounts (ANA) are compiled in constant and current prices by National Institute of Statistics (INS) under the Ministry of Plan with the technical assistance (TA) from IMF/AFC. The compilation methodology has then changed since 2006 with the use of ERETES software and the compilation of definitive ANA for 2005 and 2006 in compliance with the System of National Accounts 1993 (1993 SNA) (implying an upward revision of GDP by about 60 percent). The insufficient human resources pushed the authorities of INS to temporary suspend the use of the ERETES software. With technical assistance from AFC the INS has compiled ANA for 2016 and 2017. |
| Price statistics: Consumer price indices (CPI) are calculated for Kinshasa by the INS, the BCC, the Institute of Economic and Social Research (IESR), and the Economics Section of the U.S. Embassy in Kinshasa. In 2011, the INS started to compile CPI data Country wide using weights calculated on the basis of the 2005 household survey. Prices are collected in the 11 provinces (the BCC in 2013 began the compilation of a similar CPI using a slightly different basket and different weights and based on prices in 5 provinces). |
| Government finance statistics: The BCC produces aggregated monthly statistics on a cash basis based on its own accounting for the government cash operations. The treasury produces two sets of monthly statistics based on its own records: one relates to the transactions executed through the BCC, the other set attempts to consolidate operations through commercial bank accounts and off-budget operations. These statistics do not rely on an integrated double-entry public accounting system and do not provide sufficient details about the nature of expenditures owing to problems in the expenditure chain. However, the treasury has started to produce quarterly expenditure data reports by ministry and institution. The current work on tax administration and expenditure control, as well as the ongoing implementation of the new public accounts framework are expected to improve the quality and timeliness of fiscal statistics. The authorities also benefit from continued technical assistance in GFS under AFRITAC Central. The treasury compiled provisional annual data for the budgetary central government for 2017 and 2018 in line with international standards, but these data have not yet been disseminated. The DRC reported annual data up to 2010 for the IMF’s Government Finance Statistics Yearbook in the format of the Government Finance Statistics Manual 2001 but has not reported subsequently. However, work is underway to resume submission of data to the GFSY, beginning with data for 2012–2016, which have already been validated at the national level. |
| Monetary statistics: Monthly monetary and financial statistics (MFS) covering the central bank and other depository corporations are compiled and reported to the Fund by the BCC in the format of standardized report forms. The depository corporation survey does not include data from non-bank deposit taking institutions, a growing sector in the country. DRC has not reported data to the Financial Access Survey (FAS) since 2015. Until 2015, DRC reported some data and indicators of the FAS, including the two indicators adopted by the UN to monitor Target 8.10 of the Sustainable Development Goals (SDGs). Financial Soundness Indicators (FSIs): DRC does not report FSIs for publication on the IMF website. A technical assistance mission is scheduled in 2019 to assist the authorities in their efforts to develop a set of core and encouraged FSIs for deposit taking institutions. Balance of payments: The Central Bank of the Democratic Republic of Congo has continued its efforts to improve ESS. It is now compiling ESS using the BPM6 methodology from the data-collection phase to the compilation and dissemination phases, as supported by technical assistance under the JSA/IMF Project to Improve External Sector Statistics in 17 Selected African Countries in Francophone Africa. BOP and IIP data up to 2018 are available in IFS. Direct investment is the main weakness because of the very large amounts of transactions in this category, both for the financial account and for the income account. A register and surveys of direct investment enterprises must be established. |
| II. Data Standards and Quality |
| Since April 24, 2004, the DRC participates in the Enhanced General Data Dissemination System (e-GDDS). The metadata needs to be updated. |
Democratic Republic of the Congo: Table of Common Indicators Required for Surveillance
(as of July 10, 2019)
Any reserves assets that are pledged or otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the national values of financial derivatives to pay and receive foreign currency, including those linked to a foreign curreny but settled by other means.
Both market-based and officially determined, including discount rates; money market rates; and rates on treasury bills, notes and bonds.
Foreign, domestic bank, and domestic nonbank financing.
Including currency and maturity composition.
Includes external gross financial asset and libility positions vis-à-vis nonresidents.
Daily(D), Weekly (W), Monthly (M), Quarterly (Q), Irregular (I), Not available (NA).
Democratic Republic of the Congo: Table of Common Indicators Required for Surveillance
(as of July 10, 2019)
| Date of latest observation | Date received | Frequency of data6 | Frequency of reporting6 | Frequency of publication6 | |
|---|---|---|---|---|---|
| Exchange Rates | May-19 | 6/4/2019 | M | M | M |
| International Reserve Assets and Reserves | Apr-19 | Jun-19 | M | M | M |
| Liabilities of the Monetary Authorities1 | Apr-19 | Jun-19 | M | M | M |
| Reserve/Base Money | Apr-19 | Jun-19 | M | M | M |
| Central Bank Balance Sheet | Apr-19 | Jun-19 | M | M | M |
| Consolidated Balance Sheet of the Banking System | Apr-19 | Jun-19 | M | M | M |
| Interest Rates2 | Apr-19 | Jun-19 | M | M | M |
| Consumer Price Index | Apr-19 | Jun-19 | M | M | M |
| Central Government Revenue, Expenditure, and Financing3 | 2018 | Jun-19 | A | A | A |
| Stock of Central Government and Central Government-Guaranteed Debt4 | 2018 | Jun-19 | A | A | A |
| External Current Account Balance | 2018 | 6/4/2019 | A | A | A |
| Exports and Imports of Goods and Services | 2018 | 6/4/2019 | A | A | A |
| GDP/GNP | 2018 | Jun-19 | A | A | A |
| Gross External Debt | 2018 | Jun-19 | A | A | A |
| International Investment Position5 | 2018 | 6/7/2019 | A | A | A |
Any reserves assets that are pledged or otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the national values of financial derivatives to pay and receive foreign currency, including those linked to a foreign curreny but settled by other means.
Both market-based and officially determined, including discount rates; money market rates; and rates on treasury bills, notes and bonds.
Foreign, domestic bank, and domestic nonbank financing.
Including currency and maturity composition.
Includes external gross financial asset and libility positions vis-à-vis nonresidents.
Daily(D), Weekly (W), Monthly (M), Quarterly (Q), Irregular (I), Not available (NA).
Democratic Republic of the Congo: Table of Common Indicators Required for Surveillance
(as of July 10, 2019)
| Date of latest observation | Date received | Frequency of data6 | Frequency of reporting6 | Frequency of publication6 | |
|---|---|---|---|---|---|
| Exchange Rates | May-19 | 6/4/2019 | M | M | M |
| International Reserve Assets and Reserves | Apr-19 | Jun-19 | M | M | M |
| Liabilities of the Monetary Authorities1 | Apr-19 | Jun-19 | M | M | M |
| Reserve/Base Money | Apr-19 | Jun-19 | M | M | M |
| Central Bank Balance Sheet | Apr-19 | Jun-19 | M | M | M |
| Consolidated Balance Sheet of the Banking System | Apr-19 | Jun-19 | M | M | M |
| Interest Rates2 | Apr-19 | Jun-19 | M | M | M |
| Consumer Price Index | Apr-19 | Jun-19 | M | M | M |
| Central Government Revenue, Expenditure, and Financing3 | 2018 | Jun-19 | A | A | A |
| Stock of Central Government and Central Government-Guaranteed Debt4 | 2018 | Jun-19 | A | A | A |
| External Current Account Balance | 2018 | 6/4/2019 | A | A | A |
| Exports and Imports of Goods and Services | 2018 | 6/4/2019 | A | A | A |
| GDP/GNP | 2018 | Jun-19 | A | A | A |
| Gross External Debt | 2018 | Jun-19 | A | A | A |
| International Investment Position5 | 2018 | 6/7/2019 | A | A | A |
Any reserves assets that are pledged or otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the national values of financial derivatives to pay and receive foreign currency, including those linked to a foreign curreny but settled by other means.
Both market-based and officially determined, including discount rates; money market rates; and rates on treasury bills, notes and bonds.
Foreign, domestic bank, and domestic nonbank financing.
Including currency and maturity composition.
Includes external gross financial asset and libility positions vis-à-vis nonresidents.
Daily(D), Weekly (W), Monthly (M), Quarterly (Q), Irregular (I), Not available (NA).
Formerly Poverty Reduction and Growth Facility (PRGF).
Three reviews were concluded (of which two were associated with non-complying purchases on account of misreporting on external arrears for which the Fund granted waivers) and the last three reviews were not concluded because of governance concerns in the management of natural resources.
When a member has overdue financial obligations outstanding for more than three months, the amount of such arrears will be shown in this section.
Assistance committed under the original framework is expressed in net present value (NPV) terms at the completion point, and assistance committed under the enhanced framework is expressed in NPV terms at the decision point. Hence these two numbers cannot be added.
Under the enhanced framework, an additional disbursement is made at the completion point corresponding to interest income earned on the amount committed at the decision point but not disbursed during the interim period.
The MDRI provides 100 percent debt relief to eligible countries that qualified for the assistance. Grant assistance from MDRI Trust and HIPC resources provide debt relief to cover the full stock of debt owed to the Fund as of end-2004 that remains outstanding at the time the member qualifies for such debt relief.