Cover IMF Staff Country Reports
Democratic Republic of the Congo: Third Review under the Extended Credit Facility Arrangement, the Request for Modification of Performance Criteria and the Financing Assurance Review-Press Release; Staff Report; and Statement by the Executive Director for the Democratic Republic of the Congo
Author:
International Monetary Fund. African Dept.
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Series:
IMF Staff Country Reports
Volume/Issue:
Volume 2022: Issue 390
Language:
English
Publication Date:
23 Dec 2022
DOI:
https://doi.org/10.5089/9798400228322.002
ISBN:
9798400228322
ISSN:
1934-7685
Pages:
90
Keywords:
Congolese authorities; IMF arrangement; IMF's transparency policy; terms-of-trade shock; Policy discussion; aggregate disbursement; Credit; Budget planning and preparation; Fiscal stance; Global
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This paper discusses Democratic Republic of the Congo’s third review under the Extended Credit Facility arrangement, request for modification of performance criteria, and financing assurances review. Despite multiple shocks, economic activity has proven resilient supported by higher-than envisaged mining production. Growth is forecast at 6.6 per cent in 2022, but inflation is expected to exceed 12 percent by end-2022. The fiscal deficit is expected to narrow in 2023. Sustained revenue mobilization and contained current spending in goods, services and subsidies are expected to provide space for social spending, infrastructure, and human capital investment, and arrears clearance. Saving revenue over performance would support efforts to build buffers. Phasing out the fuel subsidy and establishing targeted social transfers are important measures to strengthen social safety nets to protect the vulnerable. Readiness to tighten the monetary stance to bring inflation to the 7- percent target together with efforts to strengthen the monetary policy framework will support price stability. Further accumulation of reserves, while enhancing the role of the exchange rate as a shock absorber, is essential to external resilience. The recent adoption of the new banking law is crucial to strengthen financial sector regulation and supervision.
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Cover IMF Staff Country Reports
IMF Staff Country Reports
ISSN:
1934-7685
Publisher:
International Monetary Fund
Volume 2022: Issue 390