## IMF Executive Board Completes the Fifth Review Under the Extended Credit Facility Arrangement with the Democratic Republic of the Congo _IMF News, December 14, 2023_ ## Source details **Canonical URL:** [IMF Executive Board Completes the Fifth Review Under the Extended Credit Facility Arrangement with the Democratic Republic of the Congo](https://www.imf.org/en/news/articles/2023/12/14/pr23453-drc-imf-exec-board-completes-5th-rev-ecf-arr) ## Other formats - [Markdown version](/en/news/articles/2023/12/14/pr23453-drc-imf-exec-board-completes-5th-rev-ecf-arr/index.md) - [Structured JSON version](/en/news/articles/2023/12/14/pr23453-drc-imf-exec-board-completes-5th-rev-ecf-arr/index.json) - [Bundle manifest](/en/news/articles/2023/12/14/pr23453-drc-imf-exec-board-completes-5th-rev-ecf-arr/bundle-manifest.json) ## Bibliographic details - Published: December 14, 2023 --- ### Review outcome and financing - The Executive Board completed the fifth review under the Extended Credit Facility (ECF) arrangement with the Democratic Republic of Congo. - Immediate disbursement: US$ 202.1 million towards international reserves, to continue building buffers. - Equivalent disbursement amount: SDR152.3 million (about US$ 202.1 million). - Aggregate disbursement to date: SDR913.8 million (about US$ 1219.1 million). - Press Release No. 23/453. ### Macroeconomic performance and risks - Real GDP projected at 6.2 percent in 2023, with the extractive sector supporting resilience despite negative terms of trade shocks. - Inflation: surged to 23.3 percent year-on-year in July 2023, before declining moderately following policy actions from the Central Bank of the Congo (BCC). - Current account: remains elevated due to deteriorated terms of trade and higher-than-anticipated imports. - Reserve accumulation slowed due to a shortfall in dollar-denominated mining tax revenues and the BCC’s interventions amid exchange rate depreciation pressures. - Socio-political/security context: increasingly challenging, reflecting the upcoming December 20, 2023 general elections and ongoing conflict in Eastern DRC. - Downside risks highlighted: continued fighting, potential discontents on the electoral process, and adverse terms-of-trade shocks. ### Fiscal position and public financial management - 2023 domestic fiscal deficit projected at 0.8 percent of GDP. - Limited fiscal space due to revenue underperformance; spending reprioritized towards security and elections at the expense of arrears payments. - Fiscal policy priorities: - Continued revenue mobilization. - Contained spending, including through the phasing out of fuel subsidies. - Improved spending efficiency, governance, and transparency. - Reforms to strengthen fiscal governance and transparency, enhance budget credibility, and limit the usage of emergency procedures and cash management slippages. - Progress in public financial and investment management reforms to support fiscal policy. ### Monetary policy, reserves, and financial stability - Authorities: Central Bank of the Congo (BCC) actions helped moderate inflation after the July 2023 surge. - Issues and recommendations: - Depreciation and inflationary pressures persist; strengthening monetary policy implementation is warranted. - Strengthen the implementation framework of monetary policy to achieve price stability and enhance the attractiveness of the Congolese franc. - Continue efforts to accumulate reserves while safeguarding the exchange rate’s role as a shock absorber. - Strengthen governance and safeguards of the BCC and ensure its adequate capitalization. - Implement the new banking law and the remaining FSSR recommendations to promote financial stability. ### Program performance and structural reforms - Performance under the ECF arrangement described as broadly satisfactory. - Quantitative performance criteria (end-June 2023): - All but one were met. - The PC on domestic fiscal balance was missed due to central government revenue shortfall and insufficient expenditure adjustments. - Continuous PC on introduction of new multiple currency practices was missed. - Indicative targets (end-June 2023): - All met except two: the floor on social spending and the floor on central government revenues. - Structural benchmarks (nine total): - Six were met. - Two were implemented with delays. - One (central bank recapitalization) was partially met and rescheduled. ### Policy recommendations and reform priorities (from Mr. Kenji Okamura, Deputy Managing Director, Acting Chair) - Contain macroeconomic slippages through prudent fiscal policies, curbing non-essential spending, and improving spending efficiency, governance, and transparency. - Strengthen monetary policy implementation and readiness of the central bank to tighten policy where appropriate. - Accumulate reserves and safeguard exchange rate flexibility to build external resilience. - Strengthen governance, safeguards, and capitalization of the BCC. - Implement the new banking law and remaining FSSR recommendations to promote financial stability. - Advance reforms to improve governance and transparency, including in mining; strengthen anti-corruption and AML/CFT frameworks; enhance the business environment; and build climate resilience to support private sector development and diversified, sustainable, and inclusive growth. ### Selected economic and financial indicators (as presented) - Real GDP: - 2022: 8.8 - 2023: 6.8 - 2024: 6.2 - 2025: 4.7 - Extractive GDP: - 2022: 22.2 - 2023: 11.7 - 2024: 9.1 - 2025: 4.3 - Non-extractive GDP: - 2022: 3.1 - 2023: 4.9 - 2024: 5.0 - 2025: 6.1 - GDP deflator: - 2022: 11.4 - 2023: 16.7 - 2024: 6.6 - 2025: 13.0 - Consumer prices, period average: - 2022: 9.3 - 2023: 14.8 - 2024: 19.4 - 2025: 7.1 - Consumer prices, end of period: - 2022: 13.1 - 2023: 11.5 - 2024: 20.8 - 2025: 11.6 - Money and credit (annual change in percent of beginning-of-period broad money): - Net foreign assets: 2022: -7.0; 2023: 22.9; 2024: 29.8; 2025: 8.9 - Net domestic assets: 2022: 10.4; 2023: -6.0; 2024: 2.4; 2025: 4.2 - Domestic credit: 2022: 12.4; 2023: 28.5; 2024: 12.6; 2025: 7.8 - Broad money: 2022: 3.5; 2023: 16.9; 2024: 32.3; 2025: 20.7 - Central government finance (percent of GDP): - Revenue and grants: 2022: 14.3; 2023: 16.5; 2024: 14.9; 2025: 16.8 - Expenditures: 2022: 17.5; 2023: 16.1; 2024: 15.9; 2025: 17.6 - Domestic fiscal balance: 2022: -1.2; 2023: -0.5; 2024: -0.8; 2025: -0.2 - Investment and saving: - Gross national saving: 2022: 4.6; 2023: 5.1; 2024: 7.9; 2025: 12.0 - Investment: 2022: 11.8; 2023: 10.1; 2024: 10.8 - Balance of payments: - Exports of goods and services: 2022: 42.1; 2023: 42.8; 2024: 42.5; 2025: 41.1 - Imports of goods and services: 2022: 46.9; 2023: 48.2; 2024: 48.0; 2025: 45.6 - Current account balance, incl. transfer: 2022: -5.0; 2023: -5.5; 2024: -5.3; 2025: -3.9 - Current account balance, excl. transfers: 2022: -6.1; 2023: -6.3; 2024: -5.4; 2025: -4.2 - Gross official reserves (weeks of imports): - 2022: 8.3; 2023: 9.6; 2024: 10.2; 2025: 11.2 - Debt service in percent of government revenue: - 2022: 7.4; 2023: 7.3 *Press Release No. 23/453, December 14, 2023.* --- ## References - [https://www.imf.org/-/media/images/imf/bios/imfboard.jpg](https://www.imf.org/-/media/images/imf/bios/imfboard.jpg) - [The Executive Board](https://www.imf.org/external/np/sec/memdir/eds.aspx) - [Democratic Republic of the Congo and the IMF](http://www.imf.org/external/country/COD/index.htm) - [Press Releases](https://www.imf.org/en/news/searchnews) - [PRESS CENTER](http://presscenter.imf.org/) - [see PR 21/217](https://www.imf.org/en/News/Articles/2021/07/15/pr21217-drc-imf-executive-board-approves-us-1-52b-ecf-arrangement) - [https://www.imf.org/en/home](https://www.imf.org/en/home) _Source: https://www.imf.org/en/news/articles/2023/12/14/pr23453-drc-imf-exec-board-completes-5th-rev-ecf-arr_