## IMF Executive Board Concludes 2019 Article IV Consultation with the Republic of Congo

_IMF News, January 27, 2020_

## Source details

**Canonical URL:** [IMF Executive Board Concludes 2019 Article IV Consultation with the Republic of Congo](https://www.imf.org/en/news/articles/2020/01/24/pr2016-republic-of-congo-imf-executive-board-concludes-2019-article-iv-consultation)

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## Bibliographic details
- Published: January 27, 2020

---

### Overview and recent developments
- Date of conclusion: January 17, 2020.
- Economic situation: "remains difficult but there are some signs of stability."
- Growth:
  - Non-oil growth "could turn positive for the first time since 2015" driven by recovery in the agricultural, forestry and transportation sectors.
  - Overall growth in 2019: "staying close to 2 percent."
- Oil sector: "The expansion in oil production in 2019 will be less pronounced than initially anticipated."
- Fiscal and debt management:
  - Authorities "have continued to follow prudent fiscal and debt management policies."
  - Overall public debt expected to decline in 2019 after peaking at "117 percent of GDP in 2017."
  - External public debt "remains in distress"; authorities negotiating a debt restructuring with external commercial creditors.
- Prices and external accounts:
  - Inflation "around 2 percent."
  - Current account "likely to register a strong surplus" due to rising oil exports and new mining exports.
  - "Stricter enforcement of FX regulations" contributing to stronger accumulation of net foreign assets at BEAC.

### Executive Board Assessment — main messages
- Macro context: Republic of Congo faces "very difficult economic conditions" with "high debt levels, low growth, and limited business confidence."
- Positive developments welcomed by Directors:
  - "Modest inflation levels."
  - "Downward trend in public debt."
  - "Rising net foreign assets."
- Policy priorities emphasized:
  - Continued fiscal consolidation, debt restructuring, and reforms to strengthen governance and diversify the economy.
  - Strengthen medium‑term fiscal framework; 2020 budget "pursues further fiscal consolidation."
  - Non‑oil revenue mobilization: curb tax exemptions, collect tax arrears, implement tax administration reforms.
  - Strengthen PFM systems and allocate adequate resources to critical social programs (health, education, programs for women).
  - Coordinated donor community support for adjustment efforts.
- Public debt management:
  - Continue prioritizing public debt management in the recovery plan.
  - Accelerate negotiations with external commercial creditors to reach a debt reduction agreement.
  - Implement strategy to clear domestic arrears with the private sector.
  - Contain rising non‑performing loans; provide enough liquidity to the private sector to meet tax obligations and increase business confidence.
  - Avoid new accumulation of official external arrears and clear existing stock in line with earlier commitments.
  - Call for enhanced debt transparency, including for SOEs.
- Governance and anti‑corruption:
  - Encouraged by reforms to improve governance and reduce corruption.
  - Welcomed publication of audited financial statements of the National Oil Company and the 2020 draft budget.
  - Further efforts needed to strengthen and operationalize the anti‑corruption framework; ensure new Anti‑Corruption Authority and Commission on Transparency become fully operational.
- Diversification and business environment:
  - Diversification strategy "will be key to sustain higher and more inclusive growth."
  - Emphasized reforms to increase access to electricity, reduce administrative requirements to start new businesses, and improve access to credit.

### Economic outlook and risks
- Medium term: Non-oil growth expected to recover as government implements arrears clearance strategy and reforms supporting diversification.
- Short-term risks (tilted to the downside):
  - Possible declines in oil prices.
  - Potential difficulty of sustaining high fiscal surpluses over time.
  - Capacity constraints for effective implementation of ambitious structural reform agenda.
- Mitigating upside: Medium-term upside risks to oil production if recent oil discoveries are confirmed.

### Key statistics and projections (selected figures from Table 1)
- GDP at constant prices (annual percent change): 2017: -1.8; 2018: 1.6; 2019: 2.2; 2020: 4.6; 2021: 1.9; 2022: 0.0; 2023: 1.3; 2024: 2.3.
- Oil GDP growth (annual percent change): 2017: 15.3; 2018: 23.9; 2019: 5.5; 2020: 9.5; 2021: -1.6; 2022: -8.8; 2023: -6.1; 2024: -3.4.
- Non-oil GDP growth (annual percent change): 2017: -6.2; 2018: -5.5; 2019: 0.8; 2020: 2.5; 2021: 3.6; 2022: 4.0; 2023: 4.1; 2024: 4.2.
- Consumer prices (period average): 2017: 0.4; 2018: 1.2; 2019: 1.8; 2020: 2.8; 2021: 3.0.
- Current account balance (percent of GDP): 2017: -3.5; 2018: 7.2; 2019: 8.0; 2020: 5.8; 2021: -2.9.
- Net foreign assets: 2017: -54.2; 2018: 12.3; 2019: 100.8; 2020: 32.2; 2021: 41.7; 2022: 9.3; 2023: 11.8; 2024: 6.8.
- External public debt (percent of GDP): 2017: 80.0; 2018: 61.3; 2019: 55.2; 2020: 52.7; 2021: 52.8; 2022: 51.5; 2023: 48; 2024: 46.
- Broad money (annual percent change): 2017: -10.4; 2018: -4.0; 2019: 15.8; 2020: 1.5; 2021: 8.5; 2022: 1.4; 2023: 2.9.
- Credit to the private sector (annual percent change): 2017: -5.4; 2018: 2.4; 2019: 7.0; 2020: 7.8.
- Gross national saving (percent of GDP): 2017: 26.2; 2018: 24.3; 2019: 27.8; 2020: 27.4; 2021: 25.3; 2022: 24.6; 2023: 27.6.
- Total public debt (percent of GDP): 2017: 117.5; 2018: 87.1; 2019: 77.5; 2020: 70.5; 2021: 66.9; 2022: 62.5; 2023: 56.8; 2024: 54.2.
- Total revenue (percent of non-oil GDP, unless otherwise indicated): 2017: 53.6; 2018: 74.2; 2019: 79.0; 2020: 75.4; 2021: 71.6; 2022: 67.8; 2023: 65.5.
- Oil revenue (percent of non-oil GDP): 2017: 25.2; 2018: 50.6; 2019: 51.3; 2020: 45.8; 2021: 41.2; 2022: 36.1; 2023: 29.6.
- Non-oil revenue (including grants, percent of non-oil GDP): 2017: 28.4; 2018: 23.6; 2019: 28.6; 2020: 33.2; 2021: 34.2; 2022: 35.4; 2023: 35.6; 2024: 35.9.
- Overall balance (deficit -, payment order basis, % GDP): 2017: 8.8; 2018: 8.4; 2019: 8.2; 2020: 7.6; 2021: 7.4.
- Basic primary fiscal balance (- = deficit)1: 2017: -1.9; 2018: 26.6; 2019: 24.5; 2020: 21.5; 2021: 19.7.
- Primary balance (percent of GDP): 2017: -5.2; 2018: 10.6; 2019: 9.9; 2020: 9.4; 2021: 8.6.
- Financing gap (CFAF billion)3: 2017: 260; 2018: 449; 2019: 269; 2020: 68; 2021: -98.
- Nominal GDP (Billions of CFA francs): 2017: 5,188; 2018: 6,476; 2019: 6,545; 2020: 6,767; 2021: 6,666; 2022: 6,469; 2023: 6,484; 2024: 6,652.
- Nominal oil GDP (Billions of CFA francs): 2017: 2,493; 2018: 3,932; 2019: 3,936; 2020: 4,046; 2021: 3,771; 2022: 3,373; 2023: 3,161; 2024: 3,081.
- Nominal non-oil GDP (Billions of CFA francs): 2017: 2,695; 2018: 2,544; 2019: 2,609; 2020: 2,721; 2021: 2,894; 2022: 3,096; 2023: 3,323; 2024: 3,570.
- Nominal GDP in US$ (millions): 2017: 8,932; 2018: 11,664; 2019: 11,206; 2020: 11,559; 2021: 11,496; 2022: 11,240; 2023: 11,314; 2024: 11,624.
- World oil price (U.S. dollars per barrel): 2017: 53; 2018: 62; 2019: 58; 2020: 55; 2021: 56.
- Oil production (Millions of barrels): 2017: 98; 2018: 121; 2019: 128; 2020: 140; 2021: 137; 2022: 125; 2023: 118; 2024: 114.

### Policy recommendations (summarized actions urged by Directors)
- Pursue continued fiscal consolidation and strengthen the medium‑term fiscal framework.
- Mobilize non‑oil revenue: curb tax exemptions, collect tax arrears, implement tax administration reforms.
- Strengthen PFM systems and protect resources for critical social programs (health, education, programs for women).
- Accelerate external commercial creditor negotiations to reach a debt reduction agreement; implement domestic arrears clearance strategy.
- Contain non‑performing loans and ensure adequate private sector liquidity to support business activity and tax compliance.
- Avoid new official external arrears and clear existing stock per prior commitments.
- Enhance debt transparency, including for SOEs.
- Strengthen anti‑corruption framework and operationalize anti‑corruption institutions.
- Advance structural reforms to diversify the economy, improve access to electricity, reduce administrative barriers for business creation, and improve access to credit.

*IMF Executive Board concluding statement on the 2019 Article IV consultation with the Republic of Congo.*

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## References

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- [The Executive Board](https://www.imf.org/external/np/sec/memdir/eds.aspx)
- [Republic of Congo and the IMF](http://www.imf.org/external/country/COG/index.htm)
- [IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance)
- [Press Releases](https://www.imf.org/en/news/searchnews)
- [PRESS CENTER](http://presscenter.imf.org/)
- [http://www.imf.org/external/np/sec/misc/qualifiers.htm](http://www.imf.org/external/np/sec/misc/qualifiers.htm)
- [https://www.imf.org/en/home](https://www.imf.org/en/home)

_Source: https://www.imf.org/en/news/articles/2020/01/24/pr2016-republic-of-congo-imf-executive-board-concludes-2019-article-iv-consultation_