Congo, Republic of The; - Future trends

One of the major impediments to improvements to the Congo's economy is the service on the Congo's external debt. The Congo is one of Africa's most indebted countries, with its foreign debt totaling about 250 percent of its GDP. As a result, too large a share of the government's revenues goes to servicing that debt and very little remains for building infrastructure and maintaining the social services of the country. To solve this problem, the International Monetary Fund agreed to an Interim Post-Conflict Reconstruction and Rehabilitation Program which provides for debt relief based on the Congo's implementation of economic reforms. If these measures are undertaken, and debt relief is begun, this will free up much needed resources that can be channeled to infrastructure building. Improvements in infrastructure are essential if the country wishes to draw any foreign investment and build its underdeveloped manufacturing and industrial base.

The Congo's economic progress had been hampered by poor oil prices in 1998, which resulted in a decline in government revenue. The government also experienced a slump in revenue as a result of the war. Both of these factors contributed to the major decline in the Congo's economy, which experience-3.0 percent annual GDP growth in 1999. Subsequent increases in world oil prices in 2000 and 2001 were certain to aid the economy, though the destruction of the country's infrastructure by the 1997-98 civil war may make it difficult for the country to prepare its goods for export.

In the long term, the Congo must rebuild political stability and commit itself to the dual projects of paying down public debt and rebuilding its infrastructure. Should it solve its political problems the country is likely to gain the assistance of international lending agencies, but even with such assistance the Congo faces a long and difficult road to economic well-being.

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