## _cr0539 ## Source details **Canonical URL:** [_cr0539](https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2005/_cr0539.pdf) ## Other formats - [Markdown version](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2005/_cr0539.pdf.md) - [Structured JSON version](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2005/_cr0539.pdf.json) --- ### Executive Summary — political context and strategic orientation - Political background: - Cessation of hostilities and ceasefire agreements: 1999 and 2001; peace negotiations in 2003 led to Demobilization, Disarmament and Reintegration Program (DDR). - Constitution approved by 84% of voters in January 2002. - New President elected March 10, 2002. - National elections organized on June 30th 2002. - Peace agreement with last armed opposition group signed March 2003. - Decentralization: - Constitution of January 20, 2002 conferred legal authority to “department” and “commune”; elected officials since January 11, 2003. - Social and economic background: - External debt: US$ 6.4 billion; equivalent to 235% of exports and 193% of GDP. - External debt per capita: US$ 2,100; income per capita: US$ 700 (roughly equal to 1960; down from US$ 1,100 in 1990). - Incidence of poverty: 50%. - I-PRSP intended as key instrument aligned with MDG, NEPAD and government “nouvelle espérance”. - Five strategic pillars: - Pillar 1: Consolidation of peace and promotion of good governance. - Pillar 2: Consolidating the macroeconomic framework and revamping key sectors. - Pillar 3: Access to basic social services and social welfare. - Pillar 4: Development of infrastructures. - Pillar 5: Strengthening of the fight against HIV/AIDS. - Participatory approach: - Consultations took place between May 2003 and April 2004; conclusions adopted on July 28, 2004. - Permanent Technical Secretariat (STP) to develop a participatory national network for information sharing, stakeholder interaction and impact evaluation. - Implementation, monitoring and evaluation: - Governance principles: (i) participation of all actors; (ii) accountability of state institutions; (iii) transparency in resource management. - STP responsible for implementation, monitoring and evaluation; capacity building program planned; timetable for full PRSP drafting between November 2004 and December 2006 (annexed). ### Introduction — geography, demographics, and recent economic trends - Geography and population: - Area: 142,000 square miles. - Population: estimated at 3 million people. - Population density: 8.7 people per square kilometer. - Administrative subdivisions: 11 departments (Likouala, Sangha, Cuvette Ouest, Cuvette, Plateaux, Pool, Bouenza, Lékoumou, Niari, Kouilou, Brazzaville). - Recent economic trends and post-conflict program: - Interim Post Conflict Program 2000-2002 financed mainly from oil revenues. - Real GDP growth under the program: - 2000: 7.6 percent - 2001: 3.8 percent - 2002: 4.6 percent - Oil sector growth rates: - 1999: 4.8 percent - 2000: -1% - 2001: -7.5 percent - 2002: -1.1% - 2003: – 4.5 % - Non-oil sector growth rates: - 1998: 1.9 % - 1999: -9.4% - 2000: 16.6% - 2001: 11.5% - 2002: 4.6 % - 2003: 5.5 % - Public finances: - Revenues/GDP ratio averaged 27% (1995–2002). - Share of government resources from oil revenues: 66%; non-oil: 34%. - Non-oil revenue/non-oil GDP ratio averaged 18%. - Expenditure to GDP ratio rose from 25% in 1995 to 43% in 1998. - Defense and police spending: 13% of total expenditures in 1998. - Capital expenditure allocation (2003): - Investment to infrastructures: about 58% of total capital expenditures in 2003. - Share of education in total capital expenditure in 2003: 0.7%. - Share of health care in total capital expenditure in 2003: about 5%. ### Poverty assessment — incidence, drivers, human dimensions - Poverty incidence and macroeconomic decline: - Incidence of poverty: around 50%. - Per capita GDP: US$ 1,100 in 1990 → US$ 630 in 2001. - Causes: wars, inappropriate economic policies, mismanagement of public affairs. - Impact of CFA Franc devaluation 1994: - Inflation: 4.9% in 1993 → 42.4% in 1994; dropped to 9% in 1995 and 10.2% in 1996. - Overall price increase of 71% between 1994 and 1996. - Salaries fell 27.5% with no compensatory measures. - Human poverty and services: - Education — historical primary GER: - 1960: 33% - 1978: 100% - 1984: 121% - 1990: 126% - 1996: 107% - 1999: 49% - 2002: 78% - GER for girls in rural areas: 4% to 6% lower than overall GER in 2002. - Preschool enrollment: less than 5%. - Literacy increases (1990 → 1998): - Men: 32.1% → 71.6% - Women: 13.2% → 48.2% - Illiteracy: 40.5% of population; women account for 51.8% of illiterate population. - Health: - Vaccination coverage for six EPI diseases dropped from 90% in the 1990s to less than 50% in 2000. - General mortality: 14 per 100,000 - Infant mortality: 81 per 100,000 - Live births: 1,100 per 100,000 - National HIV/AIDS prevalence rate for 2004: 4.2%; city rates 5%–10%; may reach 20% among prostitutes. - Displacement and vulnerability (1997–1999): - One in three Congolese displaced between 1997 and 1999. - Some 70% of displaced lost most possessions and suffered acute malnutrition. - Malnutrition affected between 25% and 30% of children under five. - More than 50% of medical facilities destroyed, vandalized, or looted. - Sixty percent of food production equipment and facilities destroyed. ### Institutional arrangements, participatory process and data constraints - Institutional setup for PRSP: - Comité National de Lutte contre la Pauvreté (CNLP) chaired by Minister of Planning; Vice-President Minister of the Economy, Finance and Budget. - Secrétariat Technique Permanent (STP): overall coordination; five-member Technical Cell; supported by Thematic and Sector Group (GTS). - Departmental and local committees: CDLP and CLLP. - Participatory consultations process: - Step 1: methodology and institutional framework; output: first draft I-PRSP. - Step 2: thematic and community consultations across eleven departments; output: improved draft. - Step 3: sector-level consultations; revised draft disseminated 28 July 2004. - Data constraints and planned improvements: - Lack of up-to-date population, health, mortality, budget and household spending surveys. - Cancellation of 1996 census; administrative data disrupted. - Ongoing and planned surveys: Congolese Households Expenditure Survey (ECOM), CWIQ results expected April 2005, EDS being prepared. ### Sector diagnostics — governance, debt, security, natural resources - Governance: - Problems: crisis of administration and State authority; inadequate allocation of resources; corruption and fraud; lack of coordination; inappropriate contract awarding procedures. - Debt (as of 30 April 2004): - Overall outstanding debt: 4,417 billion CFA Francs. - Foreign debt: 3,861 billion CFA Francs (87% of total). - Internal debt: 556 billion CFA Francs (13%). - Debt due to Paris Club: 58% of outstanding debt. - Debt due to private banks: 19%. - Debt due to multilateral donors: 10%. - Debt ratio over GDP: equal to or above 200%. - External arrears: 2,920 billion CFA Francs. - Security and peace: - Identified problems: absence of rule of law; illegal circulation of weapons; sexual violence; drug trafficking; unemployment; weak conflict prevention and poor border controls. - Oil sector: - Daily offshore production: about 250,000 to 260,000 barrels (90 million to 100 million barrels annually). - Oil revenues: 66% of public revenue; over 50% of GDP; almost 90% of export earnings. - Management issues: non-centralization of revenue; lack of transparency (confidentiality clauses, tax stability until 2029); high oil-collateralized debt. - Forestry: - Sixty percent of land area forested (~20 million hectares); available timber 170 million m³; sustainable harvesting potential 2 million m³ per year. - Biodiversity: 6,500 plant species; 200 mammals; over 700 bird species. - Problems: damaged forests due to fuelwood and slash-and-burn; low local processing; 1990s upheaval destroyed much timber processing industry. ### Infrastructure — transport, energy, water, telecoms, housing, finance - Transport networks: - Road network: roughly 17,300 Km: - 1,875 Km major roads; - 3,575 Km secondary roads; - 2,530 Km feeder roads; - 9,300 Km non classified roads; - 235 Km paved roads (<5% of dirt roads). - Rail network: - Major 510 Km line Brazzaville–Pointe Noire; - 91 Km section commissioned 1984; - 285 Km line Mont Belo–Gabon border (little used). - Pointe Noire Maritime Port: infrastructure “in relatively acceptable condition”; needs reorganization and rehabilitation of access and networks. - Airports: Brazzaville and Pointe Noire tarmacs, terminals and freight areas require upgrading; most secondary airports in poor state. - Energy and water: - National energy potential: Hydroelectric estimated at 2,500 MW; Gas estimated at 120 billion m³. - Operational plants: Moukoukounou 74 MW; Djoué 50 MW; Pointe Noire Gas Plant 25 MW. - Congo imports power from DRC covering 50% of power requirements. - Urban potable water coverage in 2000: 40.7%; rural potable water coverage: around 14.5%. - SNDE supplies 40 million m³ of an estimated demand of 100 million m³. - Telecommunications: - Land line density: less than one line per 100 people. - Three mobile phone operators in major urban centers since 1997. - Postal network “very defective”; restructuring of Post and Telecommunication sector ongoing. - Financial services and microfinance: - Closure of BCC and BNDC; surviving banks under tight cash flow. - Microfinance: mutual funds and women’s savings and credit associations expanding; microcredit, savings and short-term loans available via NGOs and UNDP-supported networks. - Housing: - State built only 2,000 public housing units since independence. - Self-help housing produced 218,000 houses (98% of national housing supply). - Housing demand in Brazzaville and Pointe Noire: 13,550 units per year vs annual delivery of 2,000 units. ### Strategic priorities, financial projections and pro‑poor spending (2003–2007) - Growth objective: - Target real GDP growth: 6% a year during 2005-2007. - Table 6 (selected growth targets): - Real GDP: 2003: 0.8 ; 2004: 4.0 ; 2005: 9.2 ; 2006: 4.7 ; 2007: 4.1 - Real GDP of the oil sector: -7.2 / 2.0 / 17.4 / 3.6 / 1.5 (2003–2007) - Real GDP of the non-oil sector: 5.3 / 5.0 / 5.1 / 5.3 / 5.5 (2003–2007) - Projected 2005-2007 attribution: 7.5% average growth in oil sector and 5.3% in non-oil sector to produce overall 6% average. - Key financial trends (Table 2 summary 2003–2007): - Total revenue (annual growth rate as %): 6.6 / 17.7 / 19.3 / -8.7 / -2.0 (2003–2007) - Oil revenue (annual growth as %): 6.1 / 22.2 / 22.8 / -15.7 / -6.9 (2003–2007) - Non-oil revenue (annual growth as %): 4.4 / 11.1 / 8.5 / 9.1 / 8.7 (2003–2007) - Total expenditure (annual growth as %): -18.7 / -0.3 / 9.4 / 2.5 / 2.5 (2003–2007) - Primary balance-to-GDP ratio (as %): 6.7 / 10.1 / 13.2 / 9.0 / 7.3 (2003–2007) - Investment-to-GDP ratio (as %): 22.9 / 22.9 / 22.7 / 23.0 / 24.0 (2003–2007) - Official external debt-to-GDP ratio (as %): 182.3 (2003) — data shown as “182.3 - - -” - Funding gap in billions of CFA: 2472.6 (2004); 63.6 (2005); 47.9 (2006); 64.3 (2007) - Public investment and sectoral allocation (Table 4 and Table 12–16 highlights): - TOTAL Public Investment (Total Resources) projected: - 2003*: 134800 - 2004*: 143100 - 2005: 176497.5 - 2006: 190005.3 - 2007: 205000 - Domestic Resources (Table 12): - 2005: 141497.5; 2006: 150000.3; 2007: 160000 - External Resources (Table 13): - 2005: 58000; 2006: 59500; 2007: 61000 - GDP (CFAF billion) (Table 13): - 2005: 2147; 2006: 2287; 2007: 2458.3 - Pro‑poor expenditures (Table 5 and Table 19; Unit: billions of CFAF and CFAF where specified): - Total pro-poor (billions of CFAF): - 2003: 83.41 - 2004: 109.99 - 2005: 148.55 - 2006: 184.75 - 2007: 219.34 - Pro-poor as % of GDP: - 2003: 4.03% - 2004: 4.75% - 2005: 5.94% - 2006: 7.27% - 2007: 8.38% - Pro-poor / Revenue %: - 2003: 13.60% - 2004: 15.34% - 2005: 17.44% - 2006: 23.94% - 2007: 29.07% - Pro-poor / Expenditure %: - 2003: 14.34% - 2004: 17.94% - 2005: 23.77% - 2006: 29.04% - 2007: 33.89% - Selected pro-poor program totals (Table 19 totals, CFAF): - TOTAL pro-poor allocations by year: - 2003: 45,074 - 2004: 70,050 - 2005: 103,702 - 2006: 135,486 - 2007: 165,977 - Examples of allocations (selected): - Basic education subtotal 2005: 17.537 (16.91% of 2005 pro-poor) - National roads construction and rehabilitation 2004: 28.171 (40.22% of 2004 pro-poor) - Power infrastructure 2003: 18.436 (40.90% of 2003 pro-poor) - Agriculture subtotal 2005: 11.000 (10.61% of 2005 pro-poor) - DDR reintegration financing 2005: 3.678 (3.55% of 2005 pro-poor) - Sectoral priorities and measures: - Strengthen transparency and governance in oil and forestry; centralize oil revenues in Treasury; publish oil audits; adopt EITI principles and implement actions (quarterly audits, publication of revenues, oil unit at Ministry of Finance). - Revive non-oil sectors: agriculture, forestry, building construction, public works; target non-oil GDP growth ~5% annually. - Infrastructure rehabilitation: roads, railways (CFCO, COMILOG), ports, electricity network, telecommunications coverage. - Social sector scaling-up: increase education and health budgets; rehabilitation/construction of schools and health centers; drug procurement and SNIS strengthening. - Public finance reform: revenue mobilization (non-oil), control discretionary tax exemptions, procurement reform, computerize public expenditure channels, strengthen public investment monitoring. ### Implementation, monitoring & evaluation; institutional roles - Management and implementation: - Relevant technical ministries implement I-PRSP priority actions in partnership with CSOs, NGOs, community organizations and private sector. - CNLP and CDLP to monitor and manage implementation via STP. - Ministry of Planning and Ministry of the Economy, Finance and Budget to provide technical and financial support. - Monitoring & evaluation: - STP to establish national network for exchanging experiences and assessing progress. - Capacity building for participatory M&E; solicit development partner support for regular production of key indicators. - Monitor poverty via well-being and standard of living indicators related to GNP, growth rate, agricultural output. - Monitor implementation: attainment of priority objectives, budget allocation and execution. - Assess outcomes: measure impact of policies, programs and projects; prepare three-year operational program and short/medium term action plan to produce indicators for MDG tracking. - STP responsibilities: - Coordinate management, implementation, monitoring and evaluation. - Support partners to develop development management tools. - Participate in official aid coordination with CSOs, NGOs, private sector, trade unions and Parliament. ### Risks, constraints and exogenous factors - Endogenous constraints and risks: - Political instability; lack of political, economic and institutional good governance; weakness of statistics base; lack of population/health/expenditure data; weak coordination and institutional capacity; participatory process constraints. - Exogenous constraints: - Dependence on external aid; declining oil prices; high indebtedness; non-compliance with HIPC conditions and difficulties accessing HIPC. - Fiscal risk signals: - Large funding gap 2004: CFAF 2472.6 billion; subsequent funding gaps 63.6 (2005), 47.9 (2006), 64.3 (2007) — requiring exceptional treatment of arrears and budgetary support from development partners. - Debt-related risks: - Debt servicing absorbing almost half of budgetary revenue; failure to access HIPC would “seriously mortgage the economic future of the Congo.” ### Preparation and timeline for the full PRSP (implementation steps and calendar) - Awareness and organization: - MPATIE/MEFB/STP — November 2004 for CNLP awareness and organization. - Creation of CDLP and CLLP — Nov.–Dec. 2004 (MPATIE/MEFB/STP/MATD). - Action plan for full PRSP preparation and financing — Nov.–Dec. 2004 (MPATIE/MEFB/STP/BM/PNUD). - Revitalizing STP and institutionalization: - Membership, TORs and training: Nov. 2004 – March 2005; identify expertise Jan.–May 2005. - Institutionalize PRSP process: January – April 2005; define contact persons in ministries and stakeholder groups. - Participatory consultations and data tasks: - Participation and organization: March – July 2005 (methodology finalization, partner orientation, training). - Sectoral and community consultations: August 2005 – July 2006; restitution and dissemination of findings. - Participatory evaluation and data collection: August 2004 – Sept. 2006 (monitoring quantitative and qualitative poverty indicators; STP/CNSEE lead). - Surveys, statistics and analyses: August 2004 – June 2006 (lead: MPATIE/MEFB/STP/BM/PNUD/UE). - Strategy monitoring and evaluation: June 2005 – June 2006 (STP/CNSEE). - Preparation of full PRSP: July – Dec. 2006 (STP/Preparation Committee); tasks include drafting, revision, government approval, and submission to World Bank and IMF. *Source: Executive Summary and selected chapters of the I-PRSP document (IMF Country Report excerpts).* ### Executive Summary ...................................................................................................... ### Executive Summary ### Political background - Cessation of hostilities and ceasefire agreements were signed in 1999, and then again in 2001. Following peace negotiations in 2003, the government launched its Demobilization, Disarmament and Reintegration Program (DDR) for resettling large numbers of militiamen. - The government has pursued a policy of national reconciliation, peace building and political inclusion, and initiated a decentralization process. - Political inclusion: - Major progress since 1999 in restoring peace and security and restoring democratic institutions. - In January 2002, the new constitution was approved by 84% of the voters. - On March 10, 2002, the new President of the Republic was elected. - National elections were organized on June 30th 2002 (legislative, then local government and commune officials). - In March 2003, a peace agreement was signed with the last remaining armed opposition group. - Decentralization: - The January 20, 2002 constitution gave legal authority to local governments, including “department” and “commune”, with independent administrations under elected officials voted by the department and commune councils since January 11, 2003. - Implementation has led to greater local political organization and deeper involvement of local populations in development programs. ### Social and economic background - Economy: - Political unrest and destruction of social and economic infrastructure badly hurt the economy and led to an accumulation of domestic and external arrears. - The external debt amounts to US$ 6.4 billion, equivalent to 235% of exports and 193% of GDP. - External debt amounts to US$ 2,100 per capita, compared with income per capita of just US$ 700, roughly equal to 1960, and down from US$ 1,100 in 1990. - Social background: - The incidence of poverty stands at 50%. - Health, sanitation and basic education services are weak. - Environmental degradation has led to an upsurge in endemic diseases. - The health outlook is worsened by a high prevalence of HIV/AIDS. - Government view: - Reducing poverty requires a consensus approach reflecting consultation results, and strong backing from development partners. - The I-PRSP is intended as the key instrument for consolidating peace and rebuilding the economy on a solid, sustainable foundation. ### Strategic pillars and objectives - The I-PRSP provides a short and medium term vision and strategic orientation for return to sustainable and equitable growth with the main objective of steady poverty reduction. - The I-PRSP aligns with the Millennium Development Goals (MDG), the New Partnership for Development (NEPAD) and the government’s “nouvelle espérance” program. - Five strategic pillars: - Pillar 1: Consolidation of peace and promotion of good governance (including consolidation of security and peace; promoting good economic governance; decentralization and participation; reform of the State; transparency in oil resource management; regional integration). - Pillar 2: Consolidating the macroeconomic framework and revamping key sectors (strengthening macroeconomic framework; recovery of oil and non-oil sectors; rural development; forestry; agriculture, livestock and fisheries; environment; private sector development). - Pillar 3: Access to basic social services and social welfare (education; health; hygiene, sanitation and quality water supply; social welfare and employment; gender). - Pillar 4: Development of infrastructures (transport; energy; telecommunications; housing; urban management). - Pillar 5: Strengthening of the fight against HIV/AIDS. ### Participatory approach - The I-PRSP was drafted based on participatory consultations including civil society, line ministries, NGOs, religious organizations, trade unions and the private sector. - Several consultations took place between May 2003 and April 2004; conclusions were compiled and adopted on July 28, 2004 by the government, development partners, civil society organizations and the private sector. - A Permanent Technical Secretariat (STP) will develop a participatory national network to: - Facilitate sharing of experiences and information across the country. - Facilitate ongoing interaction among stakeholders and gather opinions on key development issues. - Facilitate impact evaluation of poverty-related activities. - The I-PRSP is a springboard for preparing the full PRSP; the PRSP’s participatory approach will be used with other development players in the Congo. ### Implementation, monitoring and evaluation - PRSP implementation, monitoring and evaluation will observe three governance principles: - (i) participation of all social and economic development actors in Congo; - (ii) accountability of state institutions; - (iii) transparency in resource management. - Institutional arrangements: - The Permanent Technical Secretariat (STP) will be responsible for implementation, monitoring and evaluation and will assist partner organizations to develop appropriate development management tools for the short and medium term. - Official development assistance arrangements and procedures will be streamlined. - An economic and social information system will be institutionalized. - Coordination will involve close work with civil society organizations (CSOs), NGOs, the private sector, trade unions and the Parliament. - Capacity building: - A capacity building program will be put in place to support partners and government agencies. - A timetable for preparing and drafting the full PRSP between November 2004 and December 2006 is annexed to the document. - Monitoring and evaluation modalities: - Participatory approach to monitoring (continued stakeholder engagement). - Capacity building for monitoring and evaluation. - Ongoing monitoring and evaluation of the I-PRSP will be institutionalized. ### Risks, constraints and accompanying measures - The document identifies constraints and risks to implementing the I-PRSP (detailed in Chapter 4 and Annex). - The STP will coordinate management, implementation, monitoring and evaluation while building national capacity and streamlining aid procedures. ### Government statement on its poverty reduction strategy - Historical context: - Budget imbalances following declines in oil prices and an unfavorable dollar exchange rate undermined the public investment program and contributed to the severe economic and financial crisis compounded by social and political unrest culminating in June 1997 and December 1998. - The Interim Post-Conflict Program (PIPC) 2000-2002 started a transition from crisis management to return of growth and sustainable development. - Persistent challenges: - Very high unemployment, increasing poverty, reduced life expectancy at birth, deteriorating healthcare, food insecurity and very high indebtedness. - Commitments and priorities: - The government commits to making poverty reduction its top priority, building on “nouvelle espérance”, NEPAD, the HIPC Initiative and the MDG. - The government is committed to: (i) creating conditions for growth to generate employment and income; and (ii) implementing progressively the 20/20 initiative to substantially increase resources allocated to social sectors and in support of poverty reduction programs. - A participatory approach will include public and private sectors, civil society and development partners to ensure ownership by Congo’s people. - Institutions and financing: - A Comité national de lutte contre la Pauvreté (CNLP) and its department and commune counterparts (CDLP and CLLP) have been established to provide technical assistance to local governments and communities, and to encourage active participation in preparing, monitoring and evaluating the strategy. - The government will seek financial support from the international community, the private sector, grassroots populations and civil society to finance implementation. - Expected outcomes: - Improvement in the standard of living; meeting basic needs of the poorest; income stability; sound and sufficient nutrition; access to potable water; quality healthcare; access to education and decent housing; increased savings; and a rise in self-esteem. - Monitoring and evaluation: - An independent and decentralized Poverty and Human Development Observatory will be created to monitor and evaluate strategy implementation using appropriate and reliable indicators; a key objective will be to assess policy relevance and measure impact. *Source: Executive Summary of the I-PRSP document.* ### Introduction ### Introduction ### 1) Geography - Area: 142,000 square miles. - Population: estimated at 3 million people. - Population density: 8.7 people per square kilometer. - Borders: Cameroon and the Central African Republic to the north; Angola (the Cabinda enclave) to the south; the Democratic Republic of Congo to the east; the Republic of Gabon and the Atlantic Ocean to the west. - Climate zones: equatorial in the north, sub-equatorial in the center, humid tropical in the south. - River basins: - Congo River basin: Congo River and main tributaries Ubangui, Likouala, Sangha, and Alima. - Kouilou river basin: Kouilou and Niari rivers and tributaries Bouenza, Loutété, and Nyanga. - Land cover and soils: - Three-fifths of national territory covered by dense equatorial forest; remaining two-fifths is savanna. - Major forest ecosystems: Mayumbe forest, the Chaillu massif in the south, and the Great Forest in the north. - Soils: hydromorphic soils in flooded northern forest; lateritic soils elsewhere. - Administrative structure: - Constitution: governed by the 20 January 2002 constitution. - Subdivisions: “departments”, “mairies” (townships/communes), “districts”, and “villages”. - 11 departments: Likouala, Sangha, Cuvette Ouest, Cuvette, Plateaux, Pool, Bouenza, Lékoumou, Niari, Kouilou, and Brazzaville (national capital). ### 2) Recent trends in the economy - Post-conflict program: - Interim Post Conflict Program 2000-2002: central objective to restore conditions for economic and social recovery and rehabilitation of all economic sectors. - Primary objectives included maintaining essential infrastructure; creating an enabling environment for business and job creation; supporting human resource development; safety-net for vulnerable groups; protecting physical environment; improving distribution of national income; revitalizing social policies (National Health Development Program (PNDS) and National HIV/AIDS Program); preparing National Program on Malaria and Tuberculosis; restoring social sectors and justice; improving income distribution. - Financing: essentially from country’s own resources, mainly oil revenues. - Real GDP growth under the program: - 2000: 7.6 percent - 2001: 3.8 percent - 2002: 4.6 percent - Oil sector performance and growth rates: - Oil sector has been major growth engine but in decline since 1997. - Growth rate (oil sector or economy context as presented): - 1999: 4.8 percent - 2000: -1% - 2001: -7.5 percent - 2002: -1.1% - 2003: – 4.5 % - Cause: plummeting oil prices (fell to US$ 17 a barrel in 1999); later price rises negated by exchange rate declines. - Non-oil sector growth rates: - 1998: 1.9 % - 1999: -9.4% - 2000: 16.6% - 2001: 11.5% - 2002: 4.6 % - 2003: 5.5 % - Public finances and fiscal structure: - Revenues/GDP ratio averaged 27% between 1995 and 2002. - Share of government resources from oil revenues: 66%; remaining 34% from non-oil sector. - Non-oil revenue/non-oil GDP ratio averaged 18%, with a significant decline since 1995. - Revenues are volatile due to fluctuating oil prices and exchange rates. - Expenditure to GDP ratio: increased from 25% in 1995 to 43% in 1998. - Defense and police spending: 13% of total expenditures in 1998. - Capital expenditure allocation (post-conflict priorities): - Share of investment expenditures allocated to infrastructures: reached about 58% of total capital expenditures in 2003 (more than three times the 1998 level). - Share of education in total capital expenditure in 2003: 0.7%. - Share of health care in total capital expenditure in 2003: about 5%. ### 3) Social and political effects of the civil strife - Human and infrastructure impacts: - Loss of human life; destruction of economic and social infrastructure; looting; population displacement. - Tight supplies led to higher prices for food and essential products in the capital and other major cities. - Displacement and vulnerability (1997–1999): - Between 1997 and 1999, one Congolese citizen out of three was displaced. - Some 70% of displaced people lost most of their possessions and were suffering from acute malnutrition. - Malnutrition affected between 25% and 30% of children under the age of five. - Tens of thousands of women were raped or victims of other forms of violence. - Today (as of the report): one Congolese citizen out of two either provides housing or financial support to displaced parents. - Education interruptions: school interrupted in four regions; south of Brazzaville, half of school-age children are unable to go to school. - Health and food production infrastructure: - More than 50% of medical facilities in the country were destroyed, vandalized, or looted. - Sixty percent of food production equipment and facilities have been destroyed. ### The I-PRSP and preparation process - Purpose and structure: - The Poverty Reduction Strategy Document (I-PRSP) is the result of a participatory process involving government, associations, private sector, and civil society. - Comprises four chapters: (1) presentation of approach used to prepare I-PRSP; (2) diagnostic of poverty; (3) strategic pillars; (4) recommendations for policy measures. - Objectives: - Put the country on a path towards economic recovery and progressive reduction of poverty. - Reach consensus among development partners and beneficiaries; ensure active beneficiary role in preparing poverty reduction policies and programs. - Institutional arrangements: - Comité National de Lutte contre la Pauvreté (CNLP): - Created/modified by government decrees (No. 2001-532 of October 31, 2001; modified by decree No. 2003-60 of May 6, 2001). - Chaired by the Minister of Planning, Land administration and Economic integration; Vice-President is the Minister of the Economy, Finance and Budget. - Provides political orientation, supervises PRSP preparation, and has a Permanent Technical Secretariat (Secrétariat Technique Permanent). - Secrétariat Technique Permanent (STP): - Mandate: provide overall coordination for activities to prepare the I-PRSP, organize participatory process, monitor and evaluate PRSP priority activities. - Staffed by a five-member Technical Cell (Cellulle technique - CT). - Supported at central level by Thematic and Sector Group (GTS) including representatives from line ministries and the Economic Analysis and Planning Directorate (Direction des Etudes et de la Planification, DEP). - Civil society representation includes NGOs, trade unions, religious organizations, and private sector. - Departmental and local representation: Comité Départemental de Lutte contre la Pauvreté (CDLP) and Comité Local de Lutte contre la Pauvreté (CLLP). ### Participatory consultations (process steps) - Step 1: - Prepare methodology and institutional framework for nation-wide participatory consultations. - Launch awareness campaigns to mobilize partners and explain importance of civil society, community organizations, and vulnerable groups. - Output: first draft of the I-PRSP. - Step 2: - Full preparation with thematic consultations at central level and community consultations in eleven departments. - Objective: allow participants to voice perceptions of poverty and its causes. - Conclusions and recommendations summarized and sent to development partners, grassroots communities, civil society, NGOs, trade unions, and private sector for feedback. - Output: better quality draft of the I-PRSP, disseminated to partners. - Step 3: - Participatory consultations at sector level to integrate sector perspectives. - A revised draft was disseminated to all partners on 28 July 2004 to obtain feedback and finalize the I-PRSP. - Next steps: - Interim PRSP reflects wide consensus at central and departmental levels. - Similar process planned for full PRSP; government intends to reinforce participation and conduct several surveys. ### Chapter 2 — Diagnostic Study of Poverty: data constraints and approach - Data limitations: - Poverty has monetary and human dimensions (low incomes and limited access to basic services). - Lack of current and reliable statistical data: absence of standard surveys on population, healthcare, mortality rates, public budget, consumer spending, etc. - Cancellation of the 1996 General Population and Housing Census resulted in outdated socio-demographic data. - Socio-political conflicts have disrupted administrative data sources. - Available information is fragmented and insufficient, limiting full assessment of poverty. - Improvements planned: - Diagnostic to be improved through supplementary studies and surveys in the scope of the final PRSP. - On-going Congolese Households Expenditure Survey (ECOM), with CWIQ (Core Welfare Indicators) results expected in April 2005. - EDS being prepared to help establish a reliable outline of poverty. ### 2.1 Poverty Assessment: the People’s Perception - Participatory consultations provided qualitative and sectoral perceptions of poverty despite data gaps. - Major findings from brainstorming groups by sector: - Governance: - (i) lack of information and training of stakeholders; - (ii) excessive and fractious taxation of economic activities; - (iii) unfair competition; - (iv) wide-spread mismanagement, corruption and fraud; misuse of public resources and human abuse. - Education: - (i) inadequate budgetary allocation for education; - (ii) illiteracy; - (iii) lack or inadequate infrastructural, human, financial and documentary resources; - (iv) difficult access to education by children; - (v) increased deterioration of moral and ethical values. - Health: - (i) poor access to services and quality health care; - (ii) lack of health, hygiene and sanitation infrastructure; - (iii) upsurge in malnutrition and poor quality nutrition. - Social Protection: - (i) breaking up of families and other traditional solidarity systems; - (ii) lack of institutional mechanisms for collective sharing of and empowerment against “social security” type risks; - (iii) survival behaviors ranging from begging to shirking of family responsibilities and sometimes through aggressive attitudes. - Gender: - Many women live in poverty because of (i) low social status and (ii) difficult access to productive resources (loans, land, inputs) and social services (education, health). - Infrastructure: - (i) inadequate development support infrastructure; - (ii) lack basic infrastructure (roads, energy, and water); - (iii) difficult access to housing. - Employment: - (i) worsening of unemployment; - (ii) low-skilled human capital, particularly in rural areas; - (ii) exponential expansion of the unorganized informal sector; - (iv) job insecurity due to the lack of qualified manpower. - The Economy: - (i) low economic growth and difficult access to credit; - (ii) decline in purchasing power. - Summary of overall perception of poverty: - Causes identified: (i) lack of income; (ii) inability to access collective services as basic as primary education, affordable health care, electricity or drinking water; (iii) bad governance, corruption and feeling of being sidelined from society and decision making at local or national levels; (iv) perceived indifference on the part of the State vis-à-vis problems facing various population groups. ### 2.2 Characteristics of Poverty and Monetary Poverty - Data quality issues: - Poor quality and partial statistical data make precise measurement difficult. - Diagnostic study based on partial information from various sources and will be improved via forthcoming surveys. - Existing and on-going sources: - Sources include: (i) World Bank survey “Congo, poverty assessment” (1996); (ii) a 2000 study by the research network on social policies in West and Central Africa (RSPA/WC) titled Alternative Strategies of Poverty Reduction in Congo; (iii) UNDP survey in two semi-rural communities (Nkayi and Ouesso) in 2003. - Monetary poverty indications: - World Bank 1996 survey reference: percentage of persons living below the poverty belt at 70% (based on earlier partial survey on “infant nutrition” conducted in December 1993 and January 1995 in Brazzaville by ORSTOM using a poverty line of 8,945 CFAF per person; World Bank methodology differences noted). - Between 1998 and 2003, three studies attempted to assess poverty levels in rural, semi-rural and urban areas, partially filling gaps. - Planned data improvements: - The on-going Congolese Households Expenditure Survey (ECOM), CWIQ results expected in April 2005, and the EDS being prepared are expected to enable establishment of a more reliable poverty outline. *Introduction — _cr0539 - Introduction (IMF PDF chapter)_* ### 32. According to these studies, the incidence of poverty would be around 50% ### _cr0539 - 32. According to these studies, the incidence of poverty would be around 50% ### Poverty incidence and macroeconomic decline - According to these studies, the incidence of poverty would be around 50% in Congo, regardless of the year reviewed and the methods used. - Per capita GDP dropped from US$ 1,100 in 1990 to US$ 630 in 2001, indicating a deterioration of the situation over the last decade. - Worsening of poverty is mainly due to wars that have destroyed the economic tissue, and inappropriate economic policies and mismanagement of public affairs. The situation deteriorated everywhere and was worse still in areas most affected by the war and its consequences. ### Impact of the 1994 CFA Franc devaluation - The devaluation of the CFA Franc in 1994 resulted in higher prices for food and public services and contributed to worsening the economic situation of the Congolese people. - Inflation rose from 4.9% in 1993 to 42.4% in 1994. - Inflation dropped to 9% in 1995 and 10.2% in 1996. - This corresponds to an overall price increase of 71% between 1994 and 1996. - Salaries of Congolese workers fell 27.5% with no compensatory measures in place. - Because the Congolese economy is little diversified, the expected positive impact on economic growth and public finance as a result of devaluation failed to materialize. ### Human poverty — overview - Poverty is a multi-dimensional phenomenon that unevenly affects socio-economic groups and the various districts of the country. - Key dimensions covered: poor access to social services, education, health care, social coverage, employment, gender considerations, and basic infrastructure. ### Poor access to social services - 2002 Post Conflict Interim Program observations: - (i) Poor state of health, sanitation and basic education services contributed to reducing the standard of living and worsened poverty. - (ii) Environmental degradation led to an upsurge in endemic diseases (malaria, respiratory and diarrhea diseases, typhoid fever, intestinal parasitic diseases and skin diseases), especially among disadvantaged population groups. - HIV/AIDS prevalence has remained high despite significant anti-AIDS investments. ### Education — access and quality - Historical GER figures at primary level: - 33% in 1960 - 100% in 1978 - 121% in 1984 - 126% in 1990 - 107% in 1996 - 49% in 1999 - 78% in 2002 - GER for girls in rural areas was 4% to 6% lower than overall GER in 2002. - Preschool enrollment is less than 5%. - Causes of decline in education: - (i) increase in the cost of education; - (ii) inadequate and degraded educational infrastructure and equipment; - (iii) teachers abandoning classrooms for more lucrative sectors; - (iv) fall in the level of qualification of teachers; - (v) low level of investment spending compared to operating costs (mainly salaries); - (vi) low level of early childhood education; - (vii) imposition of levies on families by parents’-teachers’ associations. - Literacy and non-formal education: - Literacy increased from 32.1% among men and 13.2% among women in 1990 to 71.6% and 48.2%, respectively, in 1998. - These figures are below the developing countries average (80.3% for men and 64% for women). - 40.5% of Congolese are illiterate; women account for 51.8% of the illiterate population. - Geographic distribution: education infrastructure is concentrated in urban areas; average of one primary school in a radius of 14 kilometers in rural areas. ### Educational budget trends (selected figures from Table 1) - National Budget: 1999: 222.400; 2000: 323788; 2001: NA - Educational Budget (Current): 1999: 45,751; 2000: 55,344; 2001: NA - Educational Budget (Investment): 1999: 4,161; 2000: 4,316; 2001: 80,034 - Educational Budget (Total): 1999: 49,912; 2000: 459,660; 2001: - - Percentage of the sector: 1999: 20.57%; 2000: 17.09%; 2001: NA; Investment share 1999: 4.54%; 2000: 2.73%; 2001: 42.5%; Total share 1999: 15.89%; 2000: 12.38%; 2001: - - Source: 2001 Congo Balance Sheet (BISOC) published in February 2004 ### Health — access, quality, and outcomes - Health sector performance is unsatisfactory despite constitutional right to health and dense network of health structures. - Deterioration due to: - (i) closure, deterioration and destruction of healthcare facilities and obsolete equipment; - (ii) quasi-permanent lack of drugs and consumables; - (iii) inadequate trained staff and refresher training policy; - (iv) limited cooperation with NGOs and private sector; - (v) wrong human resource deployment; - (vi) beliefs (witchcraft, superstition); - (viii) partial application of national health policy and health development plan. - Shortage of medical doctors and medico-technical specialists in urban integrated health centers; private practitioners are expensive and draw patients away from public facilities. - Persistent diseases: malaria (major cause of morbidity and mortality among children under five), acute respiratory infections, HIV/AIDS, tuberculosis; upsurge in leprosy, yaws, onchocerciasis; emergence of EBOLA viral hemorrhagic fever, monkey pox, BURULI ulcer, trypanosomiasis. - National Health Development Program (NHDP) 1992-1996 goals: - (i) strengthen district health system; - (ii) increase coverage to provide at least 80% of the population with quality primary health care; - (iii) build national health system management capacities. - Vaccination coverage for six EPI diseases dropped from 90% in the 1990s to less than 50% in 2000. - Life expectancy and mortality indicators: - General mortality: 14 per 100,000 - Infant mortality: 81 per 100,000 - Live births: 1,100 per 100,000 - National HIV/AIDS prevalence rate for 2004: 4.2%; rates in major cities range between 5% and 10% and may reach 20% among prostitutes. ### Social coverage and vulnerable groups - Long decade of socio-political crisis and armed conflicts produced street children, child soldiers, teenage mothers, children killed or injured by war, and massive population displacement. - Ministry of Social Welfare and a High Commission for the Integration of the Youth established; no study conducted to assess their activities. - Safety net inadequacy: - KAP survey on child care: 87.1% of respondents acknowledge management of disabled children is handled by the family; 77.4% approved of this practice for orphans and abandoned children. - Social security characterized by acute shortage of money and irregular pension payments due to low debt recovery, failure to reconstruct employer/pensioner index file, and lack of real accounting and financial statements. - Senior citizens are abandoned despite constitutional protection (Article 30 of the 2002 Constitution). ### Employment and labor market - Employment crisis driven by mismanagement of public enterprises, improper socio-economic policies, structural adjustment programs since 1985, and recurrent wars in the 1990s. - Lack of reliable national data on unemployment; 1994 unemployment rate estimated at 30.9%. - Between 1984 and 1992, number of job losses reached about 23,700. - Factors limiting job availability: - (i) poorly diversified economy and low dynamism of stakeholders; - (ii) corrupt administration of the labor market; - (iii) failure of structural adjustment policies; - (iv) training-employment mismatch; - (v) failure of public investments. - Informal sector expanding, especially in major cities, but does not solve unemployment due to indifference of authorities, lack of organization and qualification. - Women, the disabled and young people with no vocational training are the most affected by unemployment. ### Gender dimension - Women account for 52% of the total population and are mostly engaged in agricultural production but are under-represented in decision making, the least literate, particularly vulnerable to HIV/AIDS, receive inadequate maternal health, and have limited access to credit. - Quotes from source: - "Gender inequalities are costly not only to women but also to children and several men. It leads to a decline in production (GDP), a low level of human resource development, leisure activities and a low welfare situation" - "gender disparity hampers development" - Reduction/removal of gender disparities, investment in activities carried out by women, and better recognition of their rights can improve quality of life and reduce infant and maternal mortality, spread of HIV/AIDS and poverty. - Government intends to increase women's involvement and presence at all levels, from decision making structures to management of public resources. ### Basic infrastructure — transportation summary - Access analyzed across transport, energy, water, telecommunications and communications, and financial services due to impact on development and living conditions. - Road network: roughly 17,300 Km comprising: - 1,875 Km of major roads; - 3,575 Km of secondary (prefecture level) roads; - 2,530 Km of feeder roads; - 9,300 Km of non classified roads; - 235 Km of paved roads equivalent to less than 5% of dirt roads. - Major road problems: lack of maintenance; obstacles to free movement of persons and goods; lack of supporting infrastructures (road terminals and bus stations, fuel filling stations, garages, warehouses); multiple and unreasonable taxes; lack of technical control equipment and machinery. - River transport: Congo River and major tributaries are key but face poor state of waterways, infrastructure and vessels; flooding of villages surrounding the Congo Basin; low technical capacities of services; multiple and unreasonable taxes. - Rail network: - Major 510 Km line connecting Brazzaville to Pointe Noire, much of which is one way; - 91 Km section commissioned in 1984; - 285 Km line between Mont Belo and the Gabonese border (little used). - Rail problems: serious damage during armed conflicts, damaged platforms and structures (bridges, overhead rail carriers), ballast in bad state or non-existent, long stretches needing rehabilitation. - Persistent rail sector characteristics: general poor state of rails and infrastructure; insufficient locomotives and coaches; lack of technical personnel and services; inadequate security; lack of a rail network in the north. *Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2005/_cr0539.pdf* ### 69. The infrastructure of the Pointe Noire Maritime Port is in relatively acceptable condition. ### _cr0539 - 69. The infrastructure of the Pointe Noire Maritime Port is in relatively acceptable condition. ### Pointe Noire Maritime Port and maritime transport - The infrastructure of the Pointe Noire Maritime Port is described as "in relatively acceptable condition." - Major maritime transport problems: - (i) sluggish and slow process of administrative formalities; - (ii) multiple and unreasonable taxes; - (iii) lack of maritime surveillance and anti-pollution equipment. - Port needs: reorganization, rehabilitation of access and networks. ### Airports and air transport infrastructure - Brazzaville and Pointe Noire International Airports: - Tarmacs, terminals and freight areas require upgrading to improve service quality. - Secondary airports: - A majority are in a poor state and have safety problems. - General aviation sector deficiencies: - (i) an inadequate and obsolete fleet; - (ii) degraded and inadequate infrastructure; - (iii) lack of navigational aids; - (iv) poor quality services; - (v) high tariffs; - (vi) non-compliance with regulations; - (vii) inadequate coverage and utilization of meteorological data. ### Poor access to transport services (overview and modalities) - Service quality reflects infrastructure condition. - River transport: - Structures for "navigable waterways ports and river transport" are financially handicapped due to mismanagement and high staff costs. - Destruction and lootings from wars exacerbate problems. - Overland transport: - Goods and passenger transport largely by small owners operating within a totally informal framework. - Rail service (Pointe Noire–Brazzaville): - Resumed after being stopped since the 1998 war. - Characterized by lack of comfort, punctuality and safety. - Constraints: faulty tracks, large number of station stops, inadequate capacity, defective telecommunications, scarcity of wagons and locomotives. - "Significant efforts should be made to improve services." - Air transport (domestic): - Brazzaville–Pointe Noire link served by two recently established private companies; services described as "quite satisfactory." - Secondary airports serviced only from time-to-time; safety is limited and some airports lack terminals. - Socio-economic impacts: - Deterioration of transport infrastructure severed links between cities and rural areas and isolated forestry and agriculture producers. - Consequences: farmers reduced to subsistence agriculture, disappearance of middlemen, loss of jobs and income. - Diversion of cargo traffic: - Timber operators in northern Congo who used to provide 30% of CFCO traffic now ship via Cameroon despite additional cost. - Traffic from/to sub-region countries now account for not more than 5% of Port of Pointe Noire traffic, against 70% in 1970. - "The latter is below 20% of its 1980 level." ### Water resources and power - National energy potential: - Hydroelectric: estimated at 2,500 MW. - Gas: estimated at 120 billion m³. - Operational plants: - Moukoukounou: 74 MW. - Djoué: 50 MW. - Pointe Noire Gas Plant: 25 MW capacity. - Mini diesel plants in major towns and some districts produce power ranging from 100 to 1000 KVA. - Electricity supply issues: - Population relies on power generators; breakdowns and cuts are frequent. - Power shortage causes: (i) lack of fuel and spare parts; (ii) obsolete and/or destroyed infrastructure from socio-political upheavals; (iii) bad financial and human resources management at the SNE (the power company). - Congo imports power from DRC, covering 50% of the power requirements of the country; present supply is far below real requirement. - "Energy shortfall is a real obstacle to the implementation of projects and initiation of all sorts of activities." - Potable water and sanitation: - Unsafe supply conditions for urban and rural populations due to advanced obsolescence of equipment and absence of a water resource management policy. - In communities supplied by SNDE, network output is low, billing system inefficient and payments received insufficient. ### Telecommunications and information access - Telecommunications sector: - Very low density of land lines: "less than one line per 100 people." - One of the most expensive systems in the region. - Postal network is "very defective." - Since 1997, three mobile phone operators established service in major urban centers. - A restructuring program of the Post and Telecommunication sector is on-going. - Sector constraints: - Shortage of equipment and poor human resource management. - Communication structures unevenly distributed and concentrated in major towns; rural populations have virtually no access to media or outside information. - Effects on poverty and civic engagement: exclusion from decision making and inability of media to assist citizens in enhancing responsible citizenship. - Journalists face difficulties accessing sources and new information technologies; content mismatch relative to expectations of the people. - Lack of communication structures worsened by lack of human, financial and material resources, inadequate laws, destruction of infrastructure by armed conflicts, and HIV/AIDS impacts (loss of qualified personnel, decline in output, slowdown in transfer of knowledge). ### Financial services and microfinance - Banking sector crisis: - Closure of Banque Commerciale Congolaise (BCC) and Banque Nationale pour le Développement du Congo (BNDC). - Tight cash flow for surviving banks including Union Congolaise de Banque (UCB), Banque Internationale pour le Développement du Congo (BIDC) and Crédit pour l’Agriculture, l’Industrie et le Commerce (CAIC). - Privatization: - Financial institutions have been privatized, but financial services remain inaccessible to many. - Credit procedures and conditions are unsuited to socio-economic needs of the poor, excluding many from the formal financial system. - Successive bankruptcies worsened the situation: postal savings services, national savings bank, and collapse of cooperative savings and credit (COPEC). - Microfinance evolution: - Before 1990 limited microfinance experience; mutual funds predominated. - Mutual funds restored savers' confidence by offering locally adapted micro credit. - A large network of micro credit institutions is developing, notably women’s savings and credit associations supported by the United Nations Development Program. - Financial products offered by these institutions: - (i) saving services; - (ii) short term micro credit (i.e. loans of small amounts) for household consumption; - (iii) investment credit services for micro enterprises. - Role: adapted tool to help the poor take advantage of economic opportunities and improve standards of living; contribute to reducing incidence and scope of poverty. ### Housing - Public housing delivery: - Since independence, the State built only 2,000 public housing units (excluding the housing stock of the State). - No public housing program has been implemented. - Self-help housing produced 218,000 houses, representing 98% of the national housing supply. - Urban housing gap: - In Brazzaville and Pointe Noire, housing demand is estimated at 13,550 units per year versus an annual delivery of just 2,000 units. - Urban characteristics: - High disparity: central suburbs well resourced and less populated; suburbs under equipped and very densely populated. - Squatter settlements: lack of basic equipment and infrastructure; living conditions very unsafe. - Urban management remains vague with little concern for a healthy environment. - Rural housing: - Outside conflict zones, problem is quality due to high cost of good quality building materials for most farmers. - Major obstacles: weak regulations; limited supply and high cost of building materials; inadequate financing mechanisms; little interest in developing and using local materials. ### Sectoral diagnostic — Governance - Governance definition: ability to efficiently and rationally manage public resources; ensure sustainable human development. - Focus of diagnostic: political, institutional and administrative governance. - Identified problems: - (i) crisis of administration, State authority and control; - (ii) wrong and inadequate allocation of available human, material and financial resources; - (iii) worsening of corruption and fraud; - (iv) lack of coordination among the various administrations involved in economic management; - (v) inappropriate contract awarding procedures; - (vi) the duality of the contract awarding system. ### Sectoral diagnostic — Debt - Debt situation: - Public debt is characterized as "so great" it is a major obstacle to economic recovery; debt servicing absorbs almost half of the budgetary revenue. - As of 30th April 2004: - Overall outstanding debt: 4,417 billion CFA Francs. - Foreign debt: 3,861 billion CFA Francs (or 87% of total debt). - Internal debt: 556 billion CFA Francs (13%). - Debt due to members of the Paris Club: 58% of outstanding debt. - Debt due to private banks: 19% of debt outstanding. - Debt due to multilateral donors: 10%. - Debt ratio over the GDP: equal to or above 200%. - Per capita indebtedness: "very high." - External arrears: - Estimated at 2,920 billion CFA Francs; remain an obstacle to normalizing relations with creditors. - Government actions to address debt: - a. concluding a Poverty Reduction and Growth Facilities (PRGF) arrangement with the IMF; - b. ensuring regular servicing of its debt; - c. normalizing its relations with major multilateral and bilateral creditors. - Risk: Failure to access HIPC initiative would "seriously mortgage the economic future of the Congo." - Internal debt non-payment: a major obstacle to resumption of economic activities; urgent resolution needed within a program with international community and IMF. ### Sectoral diagnostic — Security and peace - Security problems identified: - (i) absence of the rule of law; - (ii) illegal ownership and widespread circulation of weapons; - (iii) upsurge in sexual violence; - (iv) drug trafficking and consumption; - (v) indigence and deterioration of the socio-economic fiber; - (vi) increasing unemployment and worsening social exclusion, insecurity and vulnerability; - (vii) lack of food health control; - (viii) poor prevention, management and settlement of conflict; - (ix) limited cooperation among public, private and civil society organizations. - Peace-related problems identified: - (i) ownership of weapons by a cross-section of youth; - (ii) difficulty in implementing peace agreements reached by conflicting parties; - (iii) loose border controls; - (iv) difficulty in establishing social dialogue; - (v) insufficient promotion of human rights. ### Sectoral diagnostic — Oil sector - Production and economic significance: - Daily offshore production: "about 250,000 to 260,000 barrels of crude oil (90 million to 100 million barrels annually)." - Congo ranked fourth among oil producers in Sub Saharan Africa after Nigeria, Angola and Equatorial Guinea. - Oil revenues account for 66% of public revenue, over 50% of the GDP and almost 90% of export earnings. - Management and distribution issues: - Population benefits little from oil resources due to multiple factors: - (i) non-centralization of oil revenue at the National Treasury, complicating control of expenses; - (ii) lack of transparency in management of financial flows (confidentiality clause in production sharing contracts; tax stability clause enabling tax and customs exemption until 2029, the year the last permit expires); - (iv) non-involvement of the State in management of oil terminals; - (v) decline in production and holdings in trust of areas not economically viable for major oil companies; - (vi) pronounced absence of local private businessmen in the sector; - (vii) disadvantage of the State in marketing its share of crude oil; - (viii) pollution related to oil activities with few Congolese skilled in the oil profession; - (x) difficulties related to petroleum products supply; - (xi) high level of oil-collateralized debt. ### Sectoral diagnostic — Forestry sector - Natural resource base: - Sixty percent of total land area (almost 20 million hectares) is covered by forest; 80% considered commercially productive. - Available timber estimated at 170 million m³. - Harvesting potential: 2 million m³ per year without compromising forest regeneration capacity. - Roughly 53,000 hectares of eucalyptus, pines and limbas plantations capable of supplying 4 million m³. - Biodiversity: 6,500 plant species; 200 mammals; over 700 bird species; 45 species of reptiles; over 632 insect species. - Exploitation of non-timber forestry products performed by informal sector. - Economic performance and impacts: - Despite potential, Congo derives limited benefits from its forest resources. - 1990s socio-economic upheaval destroyed much of the timber processing industry. - Traditional low-cost transport methods replaced by higher cost options; a 1,300 km road was built linking Pokola to the Port of Douala (Cameroon) because of unreliability of rail-river connection, raising timber selling prices. - In southern Congo many forestry operators folded, causing job loss and worsening poverty. *IMF Country Report excerpt.* ### 108. This industry faces other problems. First, the rich forests are being damaged as poor rural ### _cr0539 - 108 ### Forestry industry: key problems and impacts - Rich forests are being damaged as poor rural inhabitants struggle to survive: - Trees are taken for fuel or to sell on the black market. - Many practice slash and burn agriculture. - Perpetual hunt for protein puts pressure on plants and animals, endangering protected species. - These practices contradict sustainable management of the forest ecosystem and the conservation of biodiversity. - Low level of education and training, coupled with lack of a work ethic, hampers sound organization of the forestry industry. - Inadequate human resources in forestry administration and the wood industry: - Low remuneration of forestry staff is hardly motivating and often exposes them to corruption and fraud. - Most industry workers come from neighboring countries. - Inadequate financial resources allocated to the sector: - Makes it difficult for the State to support investments made by timber processing companies. - Local social infrastructure (schools, dispensaries, bridges, roads) is in short supply; when work sites close, local populations are left unsupported. ### Rural development, agriculture, fishing, and water supply — findings and statistics - Historical and sectoral trends: - At independence, the Congo was predominantly an agriculture country: in the 1960s, 80% of the population earned a living from agriculture against 40% today. - Estimated total land area available for cultivation: 10 million hectares; less than 2% was under cultivation from 1978 to 1990. - Agriculture’s share of GDP: 27.13% in 1960; 11.69% in 1980; 9.57% by 1997. - Causes of agricultural decline: - Inconsistent policies, inadequate and unsuitable institutional support, deterioration of rural infrastructure, and rural exodus. - Dependence on imports has increased and food shortage has worsened. - Sudden divestiture of the State from the productive sector in May 1986 negatively impacted rural populations; private sector unprepared to take over: - traditional farming, which accounts for 81% of the total land area cultivated; - sedentary farming in the suburbs; - farms and ranches. - Current agricultural structure: - Agriculture limited to farmhouse production focused mainly on subsistence food crops. - Livestock farming: mostly men (87%) versus women (13%); heavy livestock farming exclusively by men; women involved in backyard livestock farming. - Fishing and aquaculture: - Fish resources: 80,000 tons per year from maritime waters and 100,000 tons per year from river waters. - Expansion hampered by instability, obsolete means of production, and scarcity of infrastructure. - Aquaculture mainly pond fish-farming by small farmers; state-owned operations in advanced stages of deterioration. - Water supply coverage and service delivery: - Urban potable water coverage in 2000: 40.7%. - National Water Distribution Company (SNDE) established by Law 15/67 dated 15th June 1967. - Of an estimated demand of 100 million m³ only 40 million m³ are supplied to the urban population, which covers only 40% of the total demand. - Rural potable water supply coverage around 14.5%. - Rural water supply structures (wells with manual pumps, treated sources, cement tanks, rainwater reservoirs) are insufficient; majority have broken down due to excessive use and lack of maintenance; people draw water from streams and rivers with undetermined quality, raising health risks. - Environment: - Very pronounced degradation of the ecosystem and national resources due to shifting slash and burn agriculture, deforestation near towns, poaching, unsound fishing practices, pollution of marine and national waters, and environmental nuisances in urban and rural areas. ### Private sector — constraints and bottlenecks - Historical impediments: - 1964 decision making the State the major investor and employer was a major obstacle to local private initiative. - Private sector remains dominated by foreign communities organized by nationality. - Gradual divestiture of the State from productive sectors starting in 1986 without supportive measures failed to expand the private sector or create new stakeholders. - Consequences of 1990s instability: - Socio-political conflicts and destruction of infrastructure broadened social imbalances, increased unemployment (particularly among youth), and raised poverty incidence. - Major obstacles to private sector development: - Embryonic financial system; very restrictive institutional, legal, judicial and tax environment; lack of basic infrastructure; poor state of manufacturing and engineering industries. - Lack of entrepreneurial culture and mismatch between training policies and market needs. - Heavy taxation, lengthy administrative procedures, obsolete rules and regulations. - No research and development policy; sub-regional and regional environment fraught with tensions and crises. - Financial constraints: - Absence of development banks and weakness of the banking sector; restructuring underway should improve situation. - Absence of (i) a mechanism for protecting depositors against shortcomings of national banks and (ii) instruments for mobilizing savings and financing SMEs and SMIs. - Additional constraints hampering SMEs/SMIs: - (i) departure of several Congolese economic operators overseas; (ii) suspension of relations with development partners; (iii) destruction of economic infrastructure; (iv) absence of specific measures to reactivate, promote and develop an SMEs/SMIs fabric; (v) lack of local private businessmen in the oil sector; (vi) reluctance of economic operators to invest in primary and secondary sector SMEs and SMIs. ### Civil society — status, limitations, and role in poverty reduction - Emergence and scope: - Social capital grew with the 1991 National Sovereign Conference; civil society operates within a difficult democratic environment with recurrent conflicts. - Social capital consists of several networks of NGOs and associations, though numbers may be artificially inflated due to overlapping activities. - Operational limitations: - Civil society increasingly called upon to partner with public authorities, but partnerships often reduce to invitations without substantive involvement. - Implementation of civil society missions requires significant resources that organizations lack. - Some NGOs act as public authorities or are off-shoots of political groups, stifling genuine partnerships. - Barriers to effective dialogue and partnership: - (i) difficulties in determining relations among platforms and public authorities; (ii) lack of sectoral dialogue structures; (iii) persistence of interventionist society model; (iv) general lack of appropriate skills and resources. - Priority for poverty reduction: - Making CSO and private sector activities more efficient and involving them in poverty reduction is a priority. - Civil society must organize and structure itself within a coordinated structure to federate various networks to contribute fully to nation building, economic and social policy management, peace-building and democracy. ### Institutional framework and procedural weaknesses - Human resources and working conditions: - Crucial problem: lack of qualified personnel and very demoralizing working conditions in ministerial departments. - Institutional problems: - Non-compliance with management procedures and lack of reliable statistical data hinder coherent economic policy formulation. - Lack of coordination and functional links among administrations involved in economic management obstacles for implementing micro-economic and sectoral policies. - Public investment programming, particularly social projects financed with oil revenue, is held up by poor project identification, monitoring, control and evaluation. - Planning units (DEP) within technical departments generally play a minor role needing review. - Information and technology gaps: - Need to reinforce synergy between the Ministry of Economic Affairs, Finance and Budget, and the Ministry of Town and Council Planning and Economic Integration through New Information and Communication technologies (NICT) to enhance information flow. - Lack of a management plan complicates continuous training and efficient deployment of civil service personnel. - Obsolete computer hardware and software often unsuited to administrative needs. - Lack of coordination of the statistical system results in an unhelpful mixture of economic and social information. - Data, monitoring and decision-support deficiencies: - Limited financial resources and poor management hinder processing, dissemination and integration of data into micro-economic and sectoral policy analysis. - Absence of decision-enhancing tools: operating reports, economic budgets, poverty monitoring-evaluation indicators, an investment timing and evaluation system, etc. - Lack of such instruments makes it difficult to control the economy and to make medium-term allocation of resources. ### Strategic priorities and Pillar 1 (overview and actions) - Government short-term objectives (to restore sound economic growth and achieve MDGs, NEPAD, and “Nouvelle Esperance”): - (i) consolidating peace and good governance; - (ii) strengthening the macro-economic framework and rehabilitating key sectors; - (iii) improving access to basic social services (education, health, hygiene, sanitation and safe water supply); social welfare and employment; - (iv) improving basic infrastructures; - (v) intensifying the fight against HIV/AIDS. - These five objectives constitute the five pillars underlying Government’s Poverty Reduction Strategy. - Pillar 1: Consolidation of Peace and Promotion of Good Governance - Sub-objectives: - (i) consolidation of security and peace; - (ii) promotion of good governance. - Consolidation of security and peace — strategic components: - Strengthen the national demobilization plan; - Implement conflict prevention, management and resolution mechanisms; - Strengthen consultation in the design and implementation of policies and programs. - Planned actions under security consolidation: - Disarm and reintegrate militias; - Retrieve arms; - Fund economic projects presented by the ex-militias; - Organize peace promotion campaigns; - Intensify border control measures; - Pay salaries, scholarships and pensions on a regular basis; - Ratify and promote treaties and agreements relating to human rights; - Create consultation frameworks. - Promotion of good governance — adopted goals: - Promote good economic governance; - Promote decentralization and participation of grassroots communities; - Reform of the State; - Enhance transparency in public affairs management. - Promoting good economic governance — principles and institutional measures: - Governance aims to guarantee and promote private investment, integrity, honesty and transparency in management of the design and implementation of development policies and programs, including at decentralized levels. - All stakeholders (State, NGOs/associations, religious groups, employer unions, private sector) should participate within a well-defined partnership framework. - CSOs should operate within a precise institutional intervention framework that: - (i) defines missions and objectives; - (ii) specifies sources and mechanisms of funding; - (iii) defines utilization and management of funds; - (iv) guarantees autonomy of NGOs/associations; - (v) determines the State’s contribution towards development of CSOs; - (vi) formalizes collaboration between the State and civil society. - Poverty reduction strategy should provide a framework for mobilizing all partners, including concerned populations, to develop synergy. - Programs designed by consensus require an environment that mitigates fraud and corruption via transparency in public affairs management and gradual elimination of corrupt practices. - Kimberly Process — planned government measures (following mission visit from May 31 to June 4th 2004): - Suspend indefinitely the certification of rough diamonds for export or sale on the domestic market as well as all agreements signed with the Bureau d’Achat de Diamants, the national diamond purchasing board. - Make CFAF 100 million immediately available to the mining administration to: - (i) reorganize the administrative and legal framework governing diamond activities in Congo; - (ii) monitor and train artisanal miners to control domestic production; - (iii) reorganize the diamond trade exchange to better trace rough diamonds exported from the Congo. - Convene in Brazzaville a meeting attended by experts from other diamond producing countries in the sub region (RDC, Angola, and CAR) to: - (i) jointly identify measures to better enforce the Kimberly process; - (ii) harmonize diamond export taxation; - (iii) curb diamond smuggling in the sub-region. - Fully cooperate with the Kimberly process in implementing the plan of action. *Source: _cr0539 - 108 (extracted content).* ### 152. Decentralization is one of the most appropriate means of ensuring that grassroots ### _cr0539 - 152. Decentralization is one of the most appropriate means of ensuring that grassroots ### Decentralization and grassroots planning - Decentralization is presented as a key instrument in combating poverty by making grassroots communities stakeholders and beneficiaries of development. - Constitutional framework: - Heading XVI of the 20 January 2002 Constitution upholds distinct state grassroots communities such as the Department and the Commune. - Main principles set out under articles 176 to 180: unhindered administration by elected authorities; resources and operational conditions to be defined by law. - Implementation milestones: - Local elections took place on 30 June 2002. - Nine bills were tabled; eight were adopted and promulgated. - Measures to continue decentralization within the fight against poverty: - Planning at the grassroots level, and managing development by and for the communities; - Drafting a community development charter. ### Reform of the State - Rationale: - Reform of the State is necessary to address multiple dysfunctions in the Congolese public service highlighted by several studies (latest: national day of reflection on the Congolese public service, March 2000). - Resources are available to undertake demanded reforms. - Priority actions from participatory consultations: - Capacity building of State departments; - Reforming public service; - Refocusing of the role of the State; - Reducing income inequalities in the State sector. ### Making oil resources management more transparent - Context: - Oil revenues account for a large part of The Congo’s national budget; transparent management is required to implement the national poverty reduction strategy. - National measures instructed by the Head of State (with stated effectiveness dates): - Quarterly auditing of Government’s revenues from the oil sector by an independent, internationally recognized auditor (effectiveness date: October 2003); - Detailed presentation to the Counsel of ministers and to the parliament of actual and estimated revenues from the oil sector, which will be fully budgeted (effectiveness date: October 2002); - Open house and workshops organized periodically by the oil ministry and the national oil company to keep the parliament and the public abreast of new developments in the oil sector, including government’s role (effectiveness date : November 2003); - Adoption by the Counsel of ministers and approval by the parliament of all new oil contracts (effectiveness date: January 1998); - Annual auditing of Congo’s national oil company by independent, internationally recognized auditor recruited according to the World Bank’s directives (effectiveness date: May 2003); - Adoption and implementation with World Bank assistance of a plan of action recommended by the 1999-2001 audit of the national oil company to improve transparency and management (effectiveness date: March 2004); - Establishment of an oil unit at the Ministry of Finance to supervise the taxation and financial aspects in contract execution (effectiveness date: March 2003); - Starting September 2003, quarterly publication of detailed information on government’s oil sector revenues, equity and taxation, including a list of all contracts signed with oil companies, on the websites: www.congo-site.com and www.mefb-cg.org. - International initiative: - An initiative launched by the Prime Minister of the United Kingdom at the Johannesburg Sustainable Development Summit in 2002; The Congo formally joined on June 10, 2004. - Contacts with DFID to discuss implementation; government encourages oil companies to participate fully. - Commitment to EITI five principles: - Recruitment of an independent auditor using international competitive bidding to audit government’s oil revenues; - Publication of oil data using the simplified standards; - Enforcing EITI principles in large private companies and in the publicly owned national oil company; - Raising awareness and obtaining the cooperation of civil society in enforcing the EITI standards; - Adopting a global implementation plan and timetable. - Additional government actions planned to facilitate EITI implementation: - Creating a body with the specific mandate of implementing the EITI and overseeing the enforcement of its principles; - Training senior staff; - Seeking the support of the international community; - Organizing consultations with companies and civil society (NGO, trade unions, etc). - Government belief: - Achieving EITI’s goal of enforcing transparency of payments and revenues in extractive industries will improve resource management and support poverty reduction. ### Regional integration - Membership: - The Congo is a member of the Central African Economic and Monetary Community (CEMAC) and the Economic Community of Central African States (CEEAC). - Rationale: - Regional integration is a key strategy to address development issues in Africa given resource constraints and economic problems facing individual countries. - New Partnership for Africa’s Development (NEPAD) makes regional integration a main objective. - Constraints to integration in Africa: - Financial and human resource constraints; - Failure to comply with treaty obligations; - Inability to prevent and resolve conflicts decisively. - Recommended national actions to foster regional integration: - (i) Strengthen national actions by ratifying the protocol as early as possible, and implement collective decisions; - (ii) Give unconditional support to the regional economic communities; - (iii) Create adequate national structures or appoint a coordinator with authority to ensure and monitor implementation of commitments made by regional economic communities and the African Union; - (iv) Create, in each country, a special group of private sector and civil society representatives to map out a strategy to enable them to discharge their responsibilities. ### Pillar 2: Consolidating the macroeconomic framework and revamping key sectors - Objective: - Strengthen short- and medium-term macroeconomic and financial framework to meet objectives of sound and sustainable growth and assist poverty reduction. - Key condition: - Cautious management of public finances to improve the financial situation and reduce external debt to sustainable levels. ### Key financial trends and projections (2003–2007) - Table 2: Summary of the State’s Financial Operations between 2003 and 2007 (as presented) - 2003 2004 2005 2006 2007 - Total revenue (annual growth rate as %) 6.6 17.7 19.3 -8.7 -2.0 - Oil revenue (annual growth as %) 6.1 22.2 22.8 -15.7 -6.9 - Non-oil revenue (annual growth as %) 4.4 11.1 8.5 9.1 8.7 - Total expenditure (annual growth as %) -18.7 -0.3 9.4 2.5 2.5 - Current expenditure (annual growth as %) -16.4 -2.2 5.1 0.6 0.5 - Capital expenditure (annual growth as %) -25.8 6.2 23.3 7.6 7.9 - Primary balance- to- GDP ratio (as %) 6.7 10.1 13.2 9.0 7.3 - Investment- to- GDP ratio (as %) 22.9 22.9 22.7 23.0 24.0 - Self-financed investment –to- GDP ratio (as %) 5.4 5.6 5.7 5.9 6.1 - Official external debt- to- GDP ratio (as %) 182.3 - - - - Funding gap in billions of CFA 2472.6 63.6 47.9 64.3 - Source: DGE, IMF, 2004 - Observations: - Oil and non-oil revenue will fall, respectively, by 1.4% and 0.1% between 2005 and 2007 (explained by a fall in oil production). - Oil revenue will remain a significant funding source, especially for social sectors. - Non-oil sector development expected to outperform oil sector due to measures to maximize tax revenue and revive forestry, agriculture, and manufacturing. - Total expenditure increases average 4.8% over 2005-2007, attributable to public expenditure rationalization. - Funding gaps: CFAF 2472.6 billion in 2004; 63.6 billion in 2005; 47.9 billion in 2006; 64.3 billion in 2007 — gaps require exceptional treatment of arrears and budgetary support from development partners. ### Sectoral allocations and public investment - Social sector: - Share of resources allocated to the social sector increases from 12.54% in 2004 to 25.25% in 2005 and remains constant up to 2008, driven by health and education outlays. - Public investment allocation objective: - The State will allocate 70% of its resources to public investment, targeting productive sectors to improve living standards. - Table 4: Projected Public Investment (Total Resources) (selected figures as presented) - TOTAL 2003*: 134800 (100.00) - TOTAL 2004*: 143100 (100.00) - TOTAL 2005: 176497.5 (100.00) - TOTAL 2006: 190005.3 (100.00) - TOTAL 2007: 205000 (100.00) - Sub-sector highlights (2003 actuell / 2004 forecast / 2005 forecast / 2006 forecast / 2007 forecast): - Sovereignty: 27468.2 / 23116 / 29867.1 / 29829 / 28540 - Infrastructure: 77744.3 / 44829 / 72953 / 75849.3 / 79291 - Productive Sectors: 3981.2 / 11008 / 18913.9 / 20879 / 25534 - Public Finance & Management: 13515.9 / 11931 / 15271.8 / 16602.5 / 17924 - Social sectors: 9360.6 / 20687 / 29587.5 / 36334.5 / 43315 - Decentralisation: 0.00 / 20569 / 0.00 / 0.00 / 0.00 - Road Fund: 2729.8 / 10960 / 99005.5 / 1105005.53 / 10400 (as presented) - Source: CNLP/STP 2004 ### Pro‑poor expenditures: levels and shares (2004–2007) - Strategic priority areas for anti-poverty strategy: - (i) basic health and fight against AIDS; (ii) basic education; (iii) basic infrastructure and opening up remote isolated areas; (iv) electricity, water and sanitation; (v) disarmament, demobilization, reintegration, and appropriate food and barracks for the troops; (vi) social protection and employment; and (vii) agriculture. - Aggregate programming (Table 5 highlights; Unit: billions of CFAF) - TOTAL 2003: 463.67 (100.00) - TOTAL 2004: 482.30 (100.00) - TOTAL 2005: 521.79 (100.00) - TOTAL 2006: 543.60 (100.00) - TOTAL 2007: 564.60 (100.00) - Total Pro-poor: - 2003: 83.41 - 2004: 109.99 - 2005: 148.55 - 2006: 184.75 - 2007: 219.34 - Pro-poor /GDP %: - 2003: 4.03% - 2004: 4.75% - 2005: 5.94% - 2006: 7.27% - 2007: 8.38% - Pro-poor / Revenue %: - 2003: 13.60% - 2004: 15.34% - 2005: 17.44% - 2006: 23.94% - 2007: 29.07% - Pro-poor / Expenditure %: - 2003: 14.34% - 2004: 17.94% - 2005: 23.77% - 2006: 29.04% - 2007: 33.89% - GDP and fiscal aggregates (as presented): - GDP: 2072.00 / 2316.00 / 2502.00 / 2540.00 / 2617.00 (2003–2007) - Revenue: 613.50 / 717.20 / 851.70 / 771.60 / 754.50 (2003–2007) - Expenditure: 581.50 / 613.00 / 625.00 / 636.10 / 647.30 (2003–2007) - Observations on pro‑poor spending composition: - Although pro‑poor expenditures increase between 2005 and 2007, their share of total expenditures and revenue remains below 30% (but rising from 16.59% in 2005 to 21.28% in 2006 and 25.58% in 2007). - Overall share of pro‑poor expenditures in the budget: 26.64% in 2005 to 38.75% in 2007. - Pro‑poor investment share of the budget to grow fastest: increase by 1.94 percentage point between 2004 and 2005; reach 19.55% in 2006 and 22.027% in 2007. - Share of goods and services (pro‑poor) 2.94% in 2004; 5% in 2005; 7.88% in 2007. - Pro‑poor expenditures under transfers and common charges remain below 6%, but are projected to increase (common charges from 1.3% in 2004 to 5.11% in 2007; transfers from 1.36% in 2004 to 3.76% in 2007). - Increased spending in the program’s first year (2005) driven by rehabilitation of education and healthcare infrastructure and higher equipment spending; subsequent years see continued growth to support construction of new schools and healthcare facilities. ### Strategies to strengthen the macroeconomic framework and public expenditure management - Two overarching strategies: - Rationalizing public finances through increased revenue and expenditure control; - Strengthening public expenditure management. - Common measures: - Maintain strict budget discipline with respect to public revenues and expenditures; - Continue non-oil income mobilization by strengthening anti-fraud and tax evasion measures, controlling discretionary tax exemptions, broadening the tax base, and improving tax administration; - Comply with prudent budgetary rule regarding projected oil price and revenue; - Increase resource allocations to priority sectors under the PRSP; - Reform the current procurement system; - Provide adequate support to the Hydrocarbon Unit in the Ministry of Finance and to the Hydrocarbon Ministry; - Computerize the public expenditures system; - Strengthen execution, control, monitoring and evaluation of public investments. *Source: Extracts from the provided IMF chapter/section PDF content.* ### 180. In view of the need to boost growth and diversify the economy, it is necessary to focus on ### _cr0539 - 180. In view of the need to boost growth and diversify the economy, it is necessary to focus on ### Growth targets and macroeconomic objectives (2005–2007) - Objective: achieve real GDP growth of 6% a year during 2005-2007. - This 6% rate is less than the estimated 7% to 8% rate necessary to reduce the level of poverty by 2007, but is characterized as a realistic goal given (i) short-term growth constraints (notably weak infrastructure) and (ii) a lack of sector strategies in most areas. - A more in-depth growth sector analysis will be presented in the final PRSP. - Table 6: Macro-Economic Growth Targets (Unit: percentage) - 2003200420052006 2007 - Real GDP 0.84.09.24.7 4.1 - Real GDP of the oil sector -7.22.017.43.6 1.5 - Real GDP of the non-oil sector 5.35.05.15.3 5.5 - Source: DGE, IMF, 2004 - Projected 2005-2007 growth attribution: - Overall 6% average growth expected to result from 7.5% average growth in the oil sector and 5.3% in the non-oil sector. ### Strategic priorities to attain growth goals - Improve transparency and governance in the oil and forestry sectors. - Develop the rural economy by expanding agriculture, livestock and fish production. - Foster private sector development. - Develop micro-finance. ### Oil sector (3.2.2.1) - Government commitment: strengthen transparency in all areas of the oil industry: exploration, production and marketing activities, and in communication and management of financial flows. - Projected oil-sector growth profile during 2005-2007: - Oil-sector real growth will peak in 2005 at 17.4%, fall to 3.6% in 2006, and to 1.5% in 2007. - Vulnerability: Congo is highly dependent on the oil sector for much of its income and is particularly vulnerable to external shocks; oil revenue volatility arises from world price fluctuations and profit-sharing mechanisms. - Fiscal management recommendation: cautiously manage oil revenue through programmed expenditure by priority order and greater sector transparency. - Priority participatory consultation actions: - Centralization of all the oil revenue in the Treasury; - Publication of oil sector audits; - Making the State participate to the management of oil terminals; - Improving the legal framework of the marketing channels of the state’s crude oil. ### Non-oil sector (3.2.2.2) - Non-oil GDP projected to expand 5% annually (consistent with diversification objective and poverty reduction). - Non-oil growth drivers: agriculture and forestry exploitation, building construction, and public works. #### Rural development (3.2.2.2.1) - Agriculture and forestry targeted as major engines of growth during the 2004-2006 period with an objective average growth rate of 5.8%. - Success depends on forestry exploitation, agriculture, livestock and fish production. ##### Forestry exploitation (3.2.2.2.1.1) - Drivers for increased log production over next three years: - Improved export conditions by land and rail; - Establishment of new forestry companies; - Increased processing capacity. - New forestry code provides for local processing of 85% of harvested logs. - Forestry tax context: - Forestry taxes will remain the lowest in the sub-region for the next five years despite prior increases (forestry tax increased from 4.5% of FOB price in 2002 to 8% in 2003 under law n°16/2000 of 27 November 2000). - The Congo experienced record forestry tax stability for over 20 years (1982-2003)23. - Intention to align with the CEMAC forestry tax rate of 15% to 17% of Fob prices over the next five years; the gradual increase will be coordinated with improvements in CFCO railways, waterways and road networks. - Sector shortcomings: past concentration on timber exploitation only; need to expand industry benefits and ensure sustainable resource management. - Forestry sector remedial measures and priorities: - Clarification of the respective roles of the public and private sector in forestry development; - Preparation of a legal and an institutional framework for delegating a number of service missions to the private forestry sector; - Resumption of forestry tax reform based on the results of studies conducted under IDA-supported Post-Conflict Economic Rehabilitation Credit; - Putting in place a reliable mechanism to transfer to the Forestry Ministry the money needed to perform its role of monitoring, regulation and protection of natural resources. ##### Agriculture, livestock and fisheries (3.2.2.2.1.2) - Rural sector has suffered from economic crisis, disincentivizing investment despite abundant natural resources and a large market. - Initiatives: special Food Security Program (PSSA) and cooperative partnerships. - Envisaged actions: - Revamping of subsistence, cash and export crops; - Launching of an agricultural development support fund; - Monitoring and evaluating farming seasons; - Building and maintaining rural tracks; - Promoting small-scale animal husbandry, fish farming and the processing of farm produce; - Promoting decentralized farmer-support structures; - Developing micro-finance. ### Environment (3.2.2.2.2) - Authorities have drawn up a National Environmental Action Plan (PNAE) emphasizing prudent and environmentally friendly natural resource management for sustainable exploitation. - PNAE priority actions: - Managing waste based on the principles of collection, processing, development and storage; - Combating other forms of pollution. ### Private sector development (3.2.2.3) - Emphasis on SMEs/SMIs with strategies to highlight investment opportunities in productive and competitive businesses attractive to multinational and national corporations. - Preconditions: consolidation of the macro-economic framework, improved economic infrastructures (transport, telecommunications, electricity, water and sewer), and institutional reforms. - Two revival priorities: - Improving the corporate institutional, legal, judicial and financial environments; - Building the capacities of the various employers unions, professional associations and consular chambers. ### Pillar 3: Access to Basic Social Services and Social Welfare (3.3) - Vulnerability drivers for large segments of the population: unsuitable socio-economic policies, structural adjustment programs with unmitigated social costs, armed conflicts, HIV/AIDS, precarious living conditions, waning family and solidarity traditions, and weak institutional social-risk sharing mechanisms. - Five adapted objectives for social security net development: - (i) improving access to quality education; - (ii) improving access to quality healthcare; - (iii) improving access to hygiene, sanitation and quality water supply; - (iv) promoting social welfare and employment; - (v) improving the social, cultural, economic and political status of women. #### Education (3.3.1) - Educational system weakened by upheaval, armed conflicts and liberalization effects. - Actions to improve access to quality education: - Increasing the education and research budget; - Building institutional capacity of pedagogical and supervision units; - Strengthening statistical data gathering and processing; - Promoting literacy and non-formal education; - Strengthening regional and sub-regional cooperation. - Supporting measures required: - Regularize use of volunteer teachers; - Reduce education costs ; - Recruit and train more teachers; - Provide scientific and technical equipment; - Rehab and build more schools; - Supervise private schools; - Encourage involvement of parents in the management of schools; - Expand the school canteen program, especially in the rural areas; - Review teacher qualifications in light of current needs. #### Health (3.3.2) - National health policy aims to improve living standards for the poor. - Major health threats: infectious diseases such as malaria and tuberculosis; special emphasis on prevention as anti-malaria drugs may be unavailable in the near future. - Major goals: - Continue prevention of endemic diseases and promotion of good health practices; - Improve quality healthcare access; - Build operational capacities of the Health Information System (SNIS); - Reform the national drug policy to ensure regular and sustainable procurement of essential generic drugs and vaccines. - Advocated actions: - Rehabilitating and building health centers to ensure nation-wide health coverage; - Designing an aggressive procurement policy for basic drugs; - Improving the distribution of healthcare personnel; - Promoting private medicine; - Promoting and strengthening community participation in the management of health centers; - Promoting and supporting traditional medicine. #### Hygiene, sanitation and quality water supply (3.3.3) - Access to safe water and sanitation is limited and contributes to low living standards. - Sanitation coverage rates (2000): - Approximately 14% in urban areas and 7% in rural areas. - Sanitation deterioration factors: street refuse dumping, silting of sewage networks, lack of waste water treatment stations, precarious excreta evacuation; these cause environmental pollution and disease proliferation. - Tuberculosis aggravated by poverty, humid equatorial climate, and link with HIV/AIDS. - Strategy components: - Develop and build institutional, human and material capacities; - Empower communities in rural and peri-urban areas for construction and management of sanitation structures; - Develop education campaigns by local NGOs; - Intensify efforts to combat malaria and tuberculosis. - Strategy actions include: - Rehabilitation, strengthening and construction of water supply and sanitation infrastructures in rural and urban areas; - Drainage of run-off water; - Treatment of waste water from hospitals, hotels and restaurants, factories, commercial structures and households; - Rehabilitation of hygiene and sanitation services; - Public education on hygiene and sanitation; - Distribution on a large scale of the impregnable mosquito net; - Destruction of mosquito breeding grounds; - Collection of household wastes; - Sensitization campaigns against tuberculosis; - Intensification of the expanded immunization program. #### Social welfare and employment (3.3.4) - Objectives: improve conditions and standard of living of vulnerable populations through a quality social welfare scheme; use labor-intensive technologies for public infrastructure works; promote dynamic employment and vocational training policies. - National policy provisions: - Legal and socio-economic protection of distressed women and girl-mothers; - Socio-economic integration of disaster-stricken people, displaced persons and ex-combatants; - Social and economic integration of the disabled and other minorities; - Strengthening community-support action; - Building capacities of NGOs, communities and families for management of vulnerable persons; - Pension scheme reform; - A dynamic employment policy; - Promotion of self-employment and small business programs. - Envisaged actions: - Organization of sensitization campaigns, popularization of the culture of peace, democracy, human, children and women’s rights; - Putting in place a violence-monitoring mechanism; - Setting up the disabled integration assistance fund; - Setting up of an integration assistance fund for the pygmies; - Training of beneficiaries of small entrepreneurs in management; - Creation of a solidarity fund in favor of vulnerable persons; - Regularization of pensions and settlement of arrears; - Improving collection of social welfare contributions; - Conducting a survey on employment; - Promotion of micro-project financing institutions; - Support to the rehabilitation and creation of vocational training centers. #### Gender (3.3.5) - Main objective: improve the social, cultural, economic and political status of women. - Strategy: - Strengthening equal access to education; - Designing, adopting and implementing a national gender policy; - Sensitization of decision makers and the public to gender-related matters; - Building capacity of the women’s promotion department, NGOs and associations involved in gender promotion. - Envisaged actions: - Creation of an information system on gender-related matters; - Promotion of male-female equality with regard to employment and services; - Promotion of maternal and child healthcare. ### Pillar 4: Development of infrastructures (3.4) - Infrastructure sector is in great disrepair and does not meet the needs of the economy; efficient infrastructures are required for economic development and poverty reduction. #### Transport (3.4.1) - National Transport Plan (PNT) objectives: - Rebuild and restore the transport system quickly to revive economic activity; - Develop road networks; - Involve the private sector through concessions and privatization. - Transport strategy aims: - Developing basic infrastructure; - Opening up the hinterland and unifying the national territory; - Restoring the country’s transit status in Central Africa. - Actions to be undertaken: - Rehabilitating the main national road networks; - Maintaining rural tracks; - Rehabilitating railways (CFCO, COMILOG); - Securing rail transport; - Procuring railway equipment; - Improving air navigation safety; - Improving inland water navigation; - Adapting barges to the transport of cut-up logs and developing the container depot at the Brazzaville harbor; - Dredging the Brazzaville, Makotipoko and Mossaka harbors; - Implementing the Pointe Noire Port and Harbor Authority Development Master Plan. #### Energy (3.4.2) - Despite considerable potential, access to adequate and cheap energy is very limited. - Access-rate targets: - Improve access rate in urban areas (50%) and rural areas (5%) and increase it to 95% in the towns and 70% in the countryside. - Sector strategy: - Rehabilitate energy infrastructures and build new ones; - Promote electricity supply throughout the country. - Resultant actions: - Rehabilitation of the national electricity grid; - Restoration of the operational capacity of the power utility, (the Société Nationale d'Electricité, SNE); - Establish the Rural Power Utility (the Agence Nationale d'Electricité Rurale, ANER). #### Telecommunications (3.4.3) - Diagnosis: both urban and rural populations face difficulty accessing telecommunications. - General objective: improve people’s access to telecommunications in rural and urban areas. - Strategy: implement the national telecommunications coverage program. *Source: _cr0539 - 180. In view of the need to boost growth and diversify the economy, it is necessary to focus on* ### 227. The actions to be taken are as follows: ### _cr0539 - 227. The actions to be taken are as follows: ### Telecommunications and Postal Sector Actions - Development of the telephone network. - Restructure the telecommunications sector and create an independent regulation authority to facilitate the presence of private operators. - Restructure the postal services. ### Housing (3.4.4) - Context and problem: - State housing policy since independence did not achieve expected results; no program pursued for several years. - State-sponsored housing failed to meet needs, prompting a self-building approach with limited access. - Current strategy to facilitate access to housing: - Putting in place a reliable and sustainable housing funding system. - Supporting production of local building materials. - Putting in place a social housing construction program. ### Urban Management (3.4.5) - Urban living conditions: - Imbalance between inner city neighborhoods (sparsely populated, efficient infrastructures) and peripheral neighborhoods (over-populated, lack of basic socio-economic amenities). - Strategy priority actions: - Updating of urban development policies. - Rehabilitation of the urban road network and the opening of link roads in dense and inaccessible neighborhoods and the newly-created zones. - Putting in place of an efficient urban environmental management strategy. - Supporting small-scale urban enterprise. - Improving urban governance and the of collection of local taxes. ### Strengthening the Fight against HIV/AIDS (Pillar 5) - Epidemiology and context: - According to a survey conducted in November-December 2003 and published in 2004, the average prevalence rate is 4.2% among the active population aged 15 to 49 but varies, depending on the level of healthcare, from 1.3% to 10.3%. - Determinants of high prevalence include: - Low-income levels and limited access to basic social services. - Weak capacity of health structures that hampers patient management. - Inadequate budgets for the HIV/AIDS. - Limited access of the patients to anti-retrovirals (ARVs). - Problem compounded by: - Influence of tradition and culture. - Inadequate resource allocations to HIV/AIDS prevention and management of persons infected with, and affected by, HIV/AIDS. - Low public involvement, except for the health and grassroots communities. - Deteriorating healthcare system. - Bad governance which weakens capacity to mobilize available resources to combat HIV/AIDS. - Main objective and strategy: - Intensify the fight against HIV/AIDS based on: - Prevention of the transmission of the virus. - Improvement in management of patients. - Epidemiological supervision. - Prevention of sexually transmissible infections (STIs). - Specific actions to be undertaken: - Education and sensitization campaigns. - Increase screening. - Promote condom use. - Integrate the AIDS component into the national health information system. - Strengthen the capacity to make epidemiological studies of HIV and sexually transmissible infections. - Improve diagnosis and treatment. - Improve counseling. - Widen availability of drugs. ### Management and Implementation of the Strategy (Chapter 4 Accompanying measures) - Institutional responsibilities: - Relevant technical ministries responsible for management and implementation of the I-PRSP priority actions, in partnership with civil society organizations, NGOs, rural and urban-based community organizations and the private sector. - National Committee for Poverty Reduction (CNLP) and Departmental Poverty Reduction Committees (CDLP) will monitor and manage implementation (by means of the Permanent Technical Secretariat). - Ministry of Planning and the Ministry of the Economy, Finance and Budget will provide technical and financial support. - Governance and institutional strengthening: - Basic principles of good governance to be taken into account, ensuring participation of all stakeholders (State, civil society, private sector) and transparency in resource management. - Strengthen Directorates for Studies and Planning (DEP), General Directorate of Planning and Development (DGPD), and the National Statistics Office (Centre National des Statistiques et des Etudes Economiques, CNSEE). - Role of the Permanent Technical Secretariat (STP): - Coordinate management and implementation of the I-PRSP. - Lend support to partner structures and organizations to establish short- and medium-term development management instruments. - Participate in official aid coordination in close co-operation with civil society, NGOs, the private sector, trade unions and Parliament. ### Monitoring and Evaluation of the I-PRSP (4.2) - Participatory approach: - Introduce a system for monitoring and evaluating the Poverty Reduction Strategy in close collaboration with social and economic development stakeholders. - Permanent Technical Secretariat will establish a national network as a framework for exchanging experiences and information and for assessing progress on poverty reduction. - Capacity building: - Participatory follow-up and evaluation require a capacity-building program for participants and the government; development partners will be asked to support such a program. - Government soliciting support from foreign partners to assure regular production of key indicators. - Need to foster coordination between CNSEE, DGPD and DEPs to facilitate collection of social statistical data. - Prepare a short-and medium-term plan of action and a three-year operational program giving priority to producing indicators to monitor the Poverty Reduction Strategy and track progress towards the Millennium Development Goals (MDG). - Monitoring and evaluation system components: - Monitoring Poverty: - Provide regular information on poverty trends and dynamics using well being and standard of living indicators; indicators will relate to Gross National Product (GNP), the rate of growth of the economy, and agricultural output. - Monitoring implementation of the I-PRSP: - Measure to what extent priority objectives have been attained and whether budget allocation and execution are on track. - Assessing outcomes of the I-PRSP: - Assess the outcome of poverty reduction policies, programs and projects. ### Constraints and Risks in Implementation (4.3) - Two sets of constraints hamper proper implementation; listed endogenous constraints and risks include: - Political instability. - Lack of political, economic and institutional good governance. - Constraints and risks in the participatory process. - Weakness of the statistics base and data collection system. - Lack of data on population, health status, household expenditure, etc. - Lack of coordination and institutional weakness liable to affect formulation of the final I-PRSP. *Source: _cr0539 - 227. The actions to be taken are as follows:* ### 250. Exogenous constraints: ### _cr0539 - 250. Exogenous constraints ### Exogenous constraints - Congo’s dependence on external aid; - Declining oil prices; - High level of indebtedness; - Non-compliance with conditions imposed by and difficulties in gaining access to the HIPC arrangements. ### Strategic pillars: summary of objectives, priority measures, and periods - Strategic Pillar 1 — Consolidate peace and promote good governance - Objectives and priority measures: - Strengthening of the national programme for démobilisation, disarmament and rehabilitation of former combatants: Disarmament of the militia; Rehabilitation of the militia; Collection of weapons; Funding of economic projects presented by former militiamen. - Implementation of prevention, management and conflict resolution mechanisms: Campaigns to popularize the culture of peace; Stepping up border controls; Regularity in payment of salaries, scholarships and pensions; Ratification and popularization of human rights treaties and conventions. - Enhancement of co-operation in policy and program implementation; Promotion of a coherent partnership with private sector, civil society and development partners; Setting up a national anti-corruption & anti-fraud program; Promotion of decentralization and grassroots community participation; State reform and civil service reform. - Follow-up/indicators include: Number of rehabilitated militiamen; Number of funded projects; Number of weapons collected; Number of disarmed militiamen; No. of public enlightenment activities; Level of border security; Amount paid out as salaries, scholarships and pensions per annum; Number of treaties and conventions ratified; GINI Index. - Periodicity: Underway; 2005 – 2007. - Strategic Pillar 2 — Revitalization of public finances, private sector revival, rural development, and sector governance - Objectives and priority measures: - Revitalization of public finances: Conformity with orthodox budget management principles in the area of oil revenue; Pursuit of efforts to mobilize non-oil revenue; Functional classification; Certification of forestry revenue; ASYCUDA Customs Check System operational; Single taxpayer identification number (NIU) applied; Control of discretionary tax exemptions. - Institutional capacity building in public expenditure management: Procurement reform; Support to Hydrocarbon Unit; Computerization of public expenditure channels; Strengthening mechanisms for public investment implementation, control, follow-up and evaluation. - Reviving the private sector: Enhance institutional, legal, judicial and financial corporate environment; Implementation of investment charter; Framework for consultation; Process to clear commercial arrears initiated. - Promotion of rural economic development: Revitalization of food-, cash- and export-crop farming; Creation of an Agricultural Development Fund; Development of farm-to-market roads. - Enhancing transparency in petroleum and forestry sectors; Development of micro-financing. - Follow-up/indicators include: Certification and publication of audit reports; Level of oil revenue; Level of debt secured by future oil production; Number of kilometers of farm-to-market roads developed; Share of agricultural sector in the GDP; ASYCUDA operational. - Periodicity: 2005 – 2007 (many actions listed as 2005 – 2007). - Strategic Pillar 3 — Human development, social protection, employment, and gender - Objectives and priority measures: - Improve access to and quality of education: Increase budget for education and research; Strengthen teacher training and supervision; Rehabilitation/construction of schools; Extension of school cafeteria program to rural areas; Regularize status of voluntary teachers. - Improve access to and quality of health care services: Increase health budget; Prevention programs; Operational capacity building of the Health-Information System (SNIS); Reform of the National-Drug Policy; Rehabilitation and construction of health centers. - Improve access to sanitation and potable water: Rehabilitation and building of rural and urban water supply infrastructure; Treatment of waste waters; Public awareness campaigns; Malaria and tuberculosis control; Promotion of low-cost housing; Rural and urban electrification. - Promote social protection and employment: Legal and socio-economic protection of women and unwed mothers; Rehabilitation of victims, displaced persons and former combatants; Pension reforms; Creation of Solidarity Fund and Rehabilitation Fund; Dynamic employment policy and support for micro-finance and vocational training. - Improve the social, cultural, economic and political status of women: Formulation/adoption/implementation of national gender policy; Create information system on gender issues; Promote infant and maternal health. - Follow-up/indicators include: Enrolment rates (boys/girls); Number of schools rehabilitated and built; Share of National Budget allocated to education and health; Number of health centers rehabilitated and built; Reduction of Infant and maternal mortality; Number of jobs created; Micro finance institutions set up. - Periodicity: 2005 – 2007. - Strategic Pillar 4 — Infrastructure development and transport, energy, telecoms - Objectives and priority measures: - Development of basic infrastructure: Rehabilitation of national highways; Maintenance of farm-to-market roads; Rehabilitation of railways (CFCO, COMILOG); Execution of the Master Plan for development of the Point Noire Port Authority. - Improve transport systems and harmonize modes: Railway transport safety; Procurement of material and rolling stock; Improvement of air navigation safety; Improvement of navigation conditions (signalling and river navigation policy); Dredging of ports; Development of Brazzaville container terminal. - Facilitate public access to electricity: Rehabilitation of national electricity grid; Restoration of operational capacity of the National Electricity Corporation (SNE); Support for National Agency for Rural Electrification (ANER). - Develop national telephone network and organize sector: Implementation of National telecommunications program; Reorganization of telecommunications sector; Creation of regulatory telecommunications Authority. - Follow-up/indicators: Distance of rehabilitated roads; Access to inter-divisional roads; Dredging and marking with beacons and buoys; Network rehabilitated; Number of localities served; Number of operators and subscribers. - Periodicity: Underway; 2005 – 2007. - Strategic Pillar 5 — Fight against HIV/AIDS and public health priorities - Objectives and priority measures: - Prevention of virus transmission; Improving arrangements to meet patients’ costs and needs; Epidemiological surveillance; Prevention of STIs. - Measures: Education and sensitization campaigns; Multiple screening tests; Promotion of condoms; Free medical, legal, psycho-social, socio-economic and nutritional care; Integration of HIV/AIDS into national health information system; Capacity building for epidemiological study. - Follow-up/indicators include: AIDS prevalence rate; Number of persons living with AIDS; Rate of contraceptive use; Number of persons with access to drugs; Number of AIDS orphans; Budget for AIDS prevention and care; Law to protect persons living with AIDS. - Periodicity: 2005 – 2007. ### Key investment budget aggregates and assumptions (selected tables and figures; all amounts in CFAF unless otherwise noted) - Table 12 — Trends in the investment budget (Domestic Resources) (CFAF millions) - TOTAL (Domestic Resources) by year: - 2000: 119001.4 - 2001: 183523.1 - 2002: 151167.6 - 2003: 111000 - 2004: 123100 - 2005: 141497.5 - 2006: 150000.3 - 2007: 160000 - Road Fund: - 2000: 2532.1 - 2001: 4359.2 - 2002: 2938.7 - 2003: 2729.8 - 2004: 10960 - 2005: 9905 - 2006: 10500 - 2007: 10400 - GRAND TOTAL (Domestic + Road Fund) by year: - 2000: 119001.4 (Domestic) + 2532.1 (Road Fund) = 119001.4 listed as TOTAL and GRAND TOTAL shown as 119001.4 / 119001.4 in table; GRAND TOTAL rows present: - GRAND TOTAL: - 2000: 119001.4 - 2001: 183523.1 - 2002: 151167.6 - 2003: 111000 - 2004: 123100 - 2005: 141497.5 - 2006: 150000.3 - 2007: 160000 - Table 13 — Underlying assumptions for Table 12 (selected items) - Sectoral shares (%) by year: - Sovereignty (%): 2000: 38.79; 2001: 26.46; 2002: 35.01; 2003: 23.01; 2004: 16.96; 2005: 18.86; 2006: 17.63; 2007: 15.53 - +Infrastructures (%): 2000: 32.69; 2001: 36; 2002: 50.39; 2003: 60.69; 2004: 47.01; 2005: 39.13; 2006: 37.55; 2007: 37.12 - Productive Sector (%): 2000: 1.45; 2001: 2.09; 2002: 2.25; 2003: 1.71; 2004: 6.95; 2005: 11.26; 2006: 11.51; 2007: 13.31 - Public Finance and management (%): 2000: 17.9; 2001: 24.7; 2002: 6.47; 2003: 8.85; 2004: 8.06; 2005: 8.37; 2006: 8.55; 2007: 8.65 - Social Sectors (%): 2000: 7.03; 2001: 8.36; 2002: 3.91; 2003: 3.28; 2004: 12.11; 2005: 15.38; 2006: 17.77; 2007: 18.91 - Route Fund (%): 2000: 2.13; 2001: 2.38; 2002: 1.94; 2003: 2.46; 2004: 8.90; 2005: 7.00; 2006: 7.00; 2007: 6.50 - Total (%) rows: 99.99, 99.99, 99.97, 100.00, 100.00, 100.00, 100.00, 100.00 - Investment Expenditures (CFAF millions): - 2000: 133796.4 - 2001: 188508 - 2002: 174473 - 2003: 134800 - 2004: 143100 - 2005: 199500 - 2006: 209500 - 2007: 221000 - Domestic Resources (CFAF millions): - 2000: 119001.4 - 2001: 183523 - 2002: 151168 - 2003: 111000 - 2004: 123100 - 2005: 141500 - 2006: 150000 - 2007: 160000 - External Resources (CFAF millions): - 2000: 14 795 - 2001: 4984.9 - 2002: 23305.3 - 2003: 23800 - 2004: 20000 - 2005: 58000 - 2006: 59500 - 2007: 61000 - GDP (CFAF billion): - 2000: 2 292 - 2001: 2043 - 2002: 2103 - 2003: 2047 - 2004: 2146 - 2005: 2147 - 2006: 2287 - 2007: 2458.3 - Domestic Resources/GDP (%): - 2000: 5.2 - 2001: 9.0 - 2002: 7.2 - 2003: 5.4 - 2004: 5.7 - 2005: 6.6 - 2006: 6.6 - 2007: 6.5 - External Resources/GDP (%): - 2000: 0.6 - 2001: 0.2 - 2002: 1.1 - 2003: 1.2 - 2004: 0.9 - 2005: 2.7 - 2006: 2.6 - 2007: 2.5 - Growth of domestic resources (%) (presented as changes): - 2001: 54.22 - 2002: -17.63 - 2003: -32.29 - 2004: 17.24 - 2005: 17.92 - 2006: 6.01 - 2007: 6.67 - Table 14 — Trends in the investment budget (Loans & Grants) (CFAF Millions) - TOTAL (Loans & Grants) by year: - 2000: 15148.8 - 2001: 5007.6 - 2002: 23305.3 - 2003: 23799.6 - 2004*: 20000 - 2005: 35000 - 2006: 40000 - 2007: 45000 - GRAND TOTAL (Loans & Grants) same as TOTAL above for listed years. - Table 15 — Trends in the investment budget (Total Resources) (CFAF million) - GRAND TOTAL (Total Resources) by year: - 2000: 134150.2 - 2001: 188530.7 - 2002: 174472.9 - 2003: 134800 - 2004*: 143100 - 2005: 176497.5 - 2006: 190005.3 - 2007: 205004 - Table 16 — Current budget 2003-2007 (CFAF billion) - TOTAL (Current Budget) by year: - 2003*: 309.87 (100.00) - 2004*: 306.29 (100.00) - 2005: 324.77 (100.00) - 2006: 335.20 (100.00) - 2007: 342.90 (100.00) - Selected sector shares (examples): - Social sectors: 2003 actual 102.58 (% not in same line) ; 2004 forecast 111.32 (36.34%); 2005 forecast 124.42 (38.31%); 2006 forecast 128.00 (38.19%); 2007 forecast 130.81 (38.15%). - Health and Population: 2003 actual 15.29; 2004 forecast 24.48 (7.99%); 2005 forecast 29.80 (9.18%); 2006 forecast 31.49 (9.39%); 2007 forecast 32.25 (9.41%). - Primary and secondary education: 2003 actual 52.78 (17.03%); 2004 forecast 41.36 (13.50%); 2005 forecast 46.54 (14.33%); 2006 forecast 48.68 (14.52%); 2007 forecast 50.33 (14.68%). - Public Finance and Management: 2003 actual 71.39 (23.04%); 2004 forecast 51.32 (16.76%); 2005 forecast 47.43 (14.60%); 2006 forecast 47.90 (14.29%); 2007 forecast 48.42 (14.12%). - Sovereignty total: 2003 actual 53.74 (17.34%); 2004 forecast 61.07 (19.94%); 2005 forecast 134.09 (41.29%); 2006 forecast 139.82 (41.71%); 2007 forecast 143.74 (41.92%). ### Pro-poor expenditure programming (Table 19) — selected totals and priorities (CFAF billion) - TOTAL pro-poor allocations by year: - 2003: 45,074 (100.00) - 2004: 70,050 (100.00) - 2005: 103,702 (100.00) - 2006: 135,486 (100.00) - 2007: 165,977 (100.00) - Selected program areas and estimates: - Construction and rehabilitation of health centers (Brazzaville, Pointe-Noire and rural): 2003: 1.417 (3.14%); 2004: 4.772 (6.81%); 2005: 6.272 (6.05%); 2006: 8.662 (6.39%); 2007: 11.368 (6.85%). - Basic drugs and other medical supplies: 2003: 0.243 (0.54%); 2004: 4.037 (5.76%); 2005: 5.795 (5.59%); 2006: 8.157 (6.02%); 2007: 10.357 (6.24%). - Construction of departmental level AIDS health centers: 2005: 1.500 (1.45%); 2006: 2.838 (2.09%); 2007: 4.018 (2.42%). - AIDS drugs supply: 2004: 2.585 (3.69%); 2005: 3.714 (3.58%); 2006: 4.394 (3.24%); 2007: 5.494 (3.31%). - Basic education (school supplies, construction, meals, textbooks): subtotal 2003: 0.373 (0.83%); 2004: 6.592 (9.41%); 2005: 17.537 (16.91%); 2006: 25.094 (18.52%); 2007: 30.930 (18.64%). - National roads construction and rehabilitation: 2003: 5.792 (12.85%); 2004: 28.171 (40.22%); 2005: 18.291 (17.64%); 2006: 24.065 (17.76%); 2007: 31.877 (19.21%). - Power infrastructure to provide electricity: 2003: 18.436 (40.90%); 2004: 3.550 (5.07%); 2005: 6.180 (5.96%); 2006: 8.300 (6.13%); 2007: 10.300 (6.21%). - Disarmament, Demobilization, Reintegration (DDR) and soldier food/barracks and reintegration financing: - Financing reintegration projects: 2003: 0.210 (0.47%); 2004: 0.620 (0.89%); 2005: 3.678 (3.55%); 2006: 5.120 (3.78%); 2007: 6.025 (3.63%). - Food and miscellaneous (related to DDR): 2003: 17.811 (39.52%); 2004: 12.497 (17.84%); 2005: 12.076 (11.64%); 2006: 10.871 (8.02%); 2007: 8.802 (5.30%). - Agriculture (training, seed distribution, feeder roads, breeding and aquaculture): subtotal 2003: 0.093 (0.21%); 2004: 0.170 (0.20%); 2005: 11.000 (10.61%); 2006: 14.670 (10.83%); 2007: 18.370 (11.07%). ### Selected social and development indicators (Tables 20–23) - Table 20 — Indicators of basic education - Literacy Rate (% of population 15 and older) 2001: - The Congo: 81,8 - Sub-Saharan Africa: 62,4 - Developing countries: 74,5 - Gross school enrolment combined (primary and secondary) in %, 2000-01: - The Congo: 57 - Sub-Saharan Africa: 44 - Developing countries: 60 - Index of level of teaching: - The Congo: 0,73 - Sub-Saharan Africa: 0,56 - Developing countries: 0,70 - Female/Male literacy ratio (15 to 24 age group) 200: - The Congo: 0,99 - Sub-Saharan Africa: 0,89 - Developing countries: 0,91 - Source: PNUD, 2003, Rapport Mondial sur le Développement Humain - Table 21 — Health indicators - Juvenile mortality rate up to 5 years (per 1000 live births): - The Congo: 108 - Sub-Saharan Africa: 172 - Developing countries: 90 - Infant mortality rate (per 1000 live births) 2001: - The Congo: 81 - Sub-Saharan Africa: 107 - Developing countries: 62 - Maternal death rate (per 100,000 live births) 1995: - The Congo: 1100 - Sub-Saharan Africa: 1098 - Developing countries: 463 - Life expectancy at birth (years) 2001: - The Congo: 48,5 - Sub-Saharan Africa: 46,5 - Developing countries: 64,4 - Population improved sanitation (%) 2000: - The Congo: N/A - Sub-Saharan Africa: 53 - Developing countries: 51 - Population with sustainable access to an improved water source (%) 2000: - The Congo: 51 - Sub-Saharan Africa: 57 - Developing countries: 78 - Source: PNUD, 2003, Rapport Mondial sur le Développement Humain - Table 22 — HIV/AIDS, malaria & tuberculosis - Adult infection rate for HIV/AIDS (15 to 49 age group) 2001: - The Congo: 4,2 - Sub-Saharan Africa: 9,00 - Developing countries: 1,30 - Malaria (per 100.000 population) 2000: - The Congo: 5.880 - Sub-Saharan Africa: N/A - Developing countries: N/A - Tuberculosis (per 100.000 population) 2001: - The Congo: 122 - Sub-Saharan Africa: 198 - Developing countries: 144 - Source: PNUD, 2004, Rapport Mondial sur le Développement Humain - Table 23 — Other socio-economic indicators - GDP per capita (PPP) 2001 (in dollar): - The Congo: 970 - Sub-Saharan Africa: 1831 - Developing countries: 3850 - Debt service ratio (% of exports of goods and services) 2001: - The Congo: 3,3 - Sub-Saharan Africa: 11,3 - Developing countries: 11,0 - ODA per Capita: - The Congo: 21,1 - Sub-Saharan Africa: 20,6 - Developing countries: 9,7 ### Key policy emphases and programmatic recommendations (as presented) - Strengthen peace-building measures: disarmament, demobilization, rehabilitation, weapon collection, and funding of reintegration economic projects (Underway; 2005–2007). - Promote good governance and state reform: anti-corruption and anti-fraud programs; public service capacity building; civil service reform (2005–2007). - Revitalize public finances and improve financial management: apply budgetary orthodoxy for oil revenue; mobilize non-oil revenue; control discretionary tax exemptions; ASYCUDA implementation; procurement reform; computerization of public expenditure channels (2005–2007). - Enhance transparency in natural resource sectors: centralize State oil revenue in the Public Treasury; publish audit reports on the oil sector; refrain from contracting new debts secured by future oil; improve forestry legal/institutional framework (2005–2007). - Accelerate human development spending: increase budget shares for education and health; rehabilitate and construct schools and health centers; drug supply and health information systems strengthening (2005–2007). - Scale up infrastructure investments: rehabilitate national highways, railways, ports; restore electricity network and expand rural electrification; develop telecommunications and regulatory frameworks (Underway; 2005–2007). - Prioritize pro-poor allocations across health, education, roads, power, DDR, agriculture, and social protection, with pro-poor totals rising from 45,074 (2003) to 165,977 (2007). *Source: _cr0539 - 250. Exogenous constraints (PDF chapter/section).* ### 1. Preparation, organization and execution of the ### 1. Preparation, organization and execution of the participatory consultations for the development of Final-PRSP. Restitution, conclusions and recommendations ### 1. Awareness and initial organization - Awareness and Organization of the CNLP. - MPATIE/MEFB/STP — November 2004 - Awareness and Creation of CDLP and CLLP. - MPATIE/MEFB/STP/MATD — Nov.–Dec. 2004 - Developing an Action plan for the full PRSP preparation and seeking finance. - MPATIE/MEFB/STP/BM/PNUD — Nov. – Dec. 2004 ### 2. Revitalizing the Permanent Technical Secretariat (PRSP) - Membership. - MPATIE/MEFB/STP — Nov.- Dec. 2004 - Developing the terms of reference. - MPATIE/MEFB/STP/BM — Nov.- Dec. 2004 - Training and sharing experience with other countries with full PRSP. - STP — January-mars 2005 - Identifying local and international expertise to support PRSP process. - MPATIE/MEFB/BM/PNUD — January-May 2005 ### 3. Institutionalizing PRSP process (January – April 2005) - Principal actors to identify and assign (3-1 Identification, implementation and accountability): - Contact person in line ministries - Thematic and Sectoral groups - Civil society - NGOs - Parliament - Trade Union - Private Sector - Religious Organization - Developing a consultation framework with partners involved with PRSP process (TORs) (3-2). - CNLP – civil society, NGOs, parliament, trade unions, rural communities, vulnerable groups. - STP/Partners in participatory process — January – June 2005 ### 4. Preparation, Organization and Implementation of participatory consultations. Restitution and Drafting of PRSP final Conclusions - Participation and Organization — Mars – July 2005 - Participatory Development Methodology. - STP/Consultant - Budget Preparation for the Organization of the Consultations. - STP/BM/Donors - Finalizing Departmental and Local Committees for the Participatory Consultations. - STP - Training of all partners (NGO, Civil society, focal points) in the participatory consultations methodology (highlighting the importance of the process). - STP - Orientation of Development Partners. - STP - Implementing Sectoral and Thematic Participatory Consultations — August 2005 – July 2006 - STP/Consultant/Sector Ministries - Organizing community participatory consultations at the departmental and local levels. - Organizing participatory consultations with civil society organizations, NGOs, trade union, religious organizations, parliament, and private sector (formal and informal). - Restituting and disseminating key findings of Consultations (drafting summary report). ### 5. Participatory Evaluation and Collection of Poverty data — August 04 – Sept. 06 - Review of existing poverty reducing program (thematic group). - STP - Monitoring quantitative and qualitative poverty indicators. - STP/CNSEE - Thematic responsibilities and partners: - Governance — Partners in PRSP process - Access to basic social services — Sectoral Ministries - Peace and Security — NGOs - Public expenditure review — MEFB/MPATIE - Communal participation — NGOs - Access to micro-credit and rural development — NGOs - Gender and Development — Associations - Education — MEPSA - Health — MSP - HIV/AIDS — CNLS - Vulnerable groups — Social Affairs ### 6. Survey, Statistics and Analyses on Poverty — August 04 – June 06 - Lead agencies: MPATIE/MEFB/STP/BM/PNUD/UE - Analytical and survey tasks: - Poverty profile, incidence and causes. - Policy analysis and sector reforms towards economic recovery. - Private sector analysis and development. - Agriculture Sector Analysis and development. - Development and reinforcement of community development structures. - Compliance with decentralization policy. - Analysis of the socio-economic impact of HIV/AIDS and development of mitigation strategies. - Consultations on urban poverty. - Consultations on women’s poverty. - STP/CNSEE/GRELUPAFA (partners indicated for consultations) ### 7. Strategy Monitoring and evaluation — June 05 – June 06 - Lead agencies: STP/CNSEE - Tasks: - Reviewing and evaluating indicators. - Establishing a Poverty and Social Services Monitoring System. - Developing and reinforcing the participatory monitoring and evaluation mechanisms. - Developing and disseminating participatory monitoring and evaluation mechanisms. ### 8. Preparation of the Full PRSP — July – Dec. 2006 - Lead agency: STP/Preparation Committee - Tasks and milestones: - Establishing the framework and the timetable for the preparation of the full PRSP. - Setting a PRSP Preparation Committee and defining its role and specific activities. - Drafting a preliminary version of the PRSP and providing it to the permanent secretariat for review and subsequent dissemination. - Revising the preliminary version and disseminating the revised version. - Obtaining Government’s approval of the final Version of the PRSP. - STP - Sending the final version to the World Bank and International Monetary Fund. - MPATIE/MEFB - Evaluation by the World Bank and International Monetary Fund. *Source: _cr0539 - 1. Preparation, organization and execution of the participatory consultations for the development of Final-PRSP. Restitution, conclusions and recommendations (PDF).* --- _Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2005/_cr0539.pdf_