DR Congo’s growth among highest in region amid significant challenges-IMF
WASHINGTON, DC– According to a recently completed annual assessment by International Monetary Fund [IMF] staff, growth in the Democratic Republic of the Congo [ DR Congo] sharply rebounded from 1.7 percent in 2020 to an estimated 6.2 percent in 2021, well above the 4.5 percent rate in sub-Saharan Africa. The strong recovery was driven by the country’s mining and services sector performance.
Under a Fund-supported programme, the authorities have adopted policies that have helped moderate inflation and stabilize the exchange rate, while commodity prices have supported higher exports, revenues, and international reserves. The war in Ukraine has led to an increase in inflation, raising food insecurity risks, but the outlook remains favorable with support from elevated commodity prices.
Decades of war, poor governance, and underinvestment, however, have left the country with high poverty rates, very low access to basic services and one of the largest infrastructure gaps in the world.
Reforms are needed to diversify and improve the resilience of the economy and to promote higher and more inclusive growth. Measures to simplify the tax system, broaden the tax base, and strengthen tax administration, accompanied by others to improve public financial management—such as implementing a single treasury account and phasing out untargeted fuel subsidies—are also needed. Continued efforts to improve governance and the business climate would support private sector development and economic diversification.
The DR Congo’s vast and varied mineral resources, rainforests and peatlands are key to the global energy transition and, with adequate policy frameworks and improved governance, can raise growth and living standards for its population.
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