At the end of an important meeting of the Political Troika chaired by Finance Minister Nicholas Cazadi, Minister of State, Minister of Budget, Aimée Boji, Deputy Minister of Finance, O’Neige Nsele, Governor of the Central Bank of Congo, Marang Cabedi and the Democratic Republic of the Congo Mrs. Mercedes Bella Martin of the African Division, Head of the IMF Mission, gave an overall assessment of the economic situation of the IMF Mission. DRC within the framework of a three-year program.
According to the Treasury Communications Unit, the discussions during this working session focused on three important points:
The economic recovery in 1 ° 2021 was estimated at 5.7%, supported by the recovery of the mining and services sector.
As a result of 2 ° external trends, the downside risk to the outlook has increased significantly. This requires maintaining a cautious macroeconomic policy.
Strengthening the implementation of the 3 ° authorities’ reform program will support recovery and strengthen the resilience of the economy.
At the end of her visit, which took place March 1-7, 2022, Mrs. Bella Martin noticed that the economy had recovered in the Democratic Republic of the Congo (DRC) in 2021.
“Preliminary data confirm the economic recovery in 2021, with an estimated GDP growth rate of 5.7%, supported by a recovery in the mining and services sectors. Inflation was 5.3% at the end of 2021. The Congolese Central Bank (BCC) cut key interest rates by 100 basis points at the end of 2021 as inflation is expected to continue to curb. Increased mining exports will drive 2.2% of GDP in 2020. From 1% of GDP in 2021. These favorable external developments and the general allocation of SDRs at the end of August 2021 have made it possible to significantly increase the level of total foreign currency reserves. The overall financial balance has improved as revenues have risen and public investment has fallen short of expectations, “she said.
For the 2022 outlook, the IMF’s head of the Democratic Republic of the Congo believes these are still good, even if certain downside risk factors need to be monitored.
“The outlook for 2022 remains good, but downside risks to the outlook are rising sharply, accumulating reserves and maintaining prudent macroeconomic policies to build resilience to external shocks. Global food and energy price increases and volatile mineral prices associated with the Ukrainian conflict-related crisis pose risks to inflation and growth. Rising oil prices are not covered. Fuel price subsidies create greater financial pressure and reduce financial space for necessary social and infrastructure spending. The IMF team pays close attention to fuel price transparency and the impact of subsidies on budgets. We asked for monitoring, “says Bella Martin.
And to continue: “The 2022 budget will provide an increase in public investment spending partially funded by SDR allocation, but the team will continue to support the authorities’ efforts to strengthen the capacity and governance of the institution. Project monitoring and execution to ensure efficient and transparent use of these funds. »»
This visit was also an opportunity for the IMF team and Congolese authorities to discuss the possibility of strengthening structural reforms to support recovery.
Once approved by Congress, the IMF Mission Chief believes that new commercial banking legislation and anti-money laundering legislation will help strengthen bank oversight.
We are confident that improved governance, especially in the management of mining resources and finances, and improved business conditions will support private sector-led growth.
According to the observations of the IMF mission, progress in structural reforms will increase economic resilience, help economic diversification and improve the standard of living of Congolese citizens.
“The IMF team would like to thank the authorities for their open and constructive discussions during this visit. The teams are Aimé Boji, Minister of State and Budget, Nicolas Kazadi, Minister of Finance, and Malangu Kabedi Mbuyi, Governor of BCC. , And other senior officials and development partners. The team held this dialogue during the visit for Article 4 consultations in 2022 and a second review under the ECF Agreement scheduled for the end of April. We look forward to continuing, “concludes Mercedes Bella Martin.