An International Monetary Fund (IMF) staff team, led by Roland Kpodar, recently concluded discussions with Congolese authorities in Brazzaville and Washington. The meetings were part of the sixth review of Congo’s three-year program under the Extended Credit Facility (ECF), initially approved by the IMF Executive Board on January 21, 2022.
The IMF team expressed approval for the Congolese authorities' commitment to policies aimed at maintaining macroeconomic stability, ensuring fiscal sustainability, and fostering inclusive growth. "The IMF staff team welcomed the authorities’ reaffirmed commitment to pursue policies under the IMF-supported program aimed to safeguard macroeconomic stability, preserve fiscal sustainability, and boost inclusive and sustainable growth," they stated.
Congo's economic recovery is projected at a growth rate of 2.6 percent for 2024, despite a slowdown in the oil sector. Growth is expected to improve over time with support from non-hydrocarbon activities. Inflation is anticipated to gradually return to the region's target of 3 percent. However, Congo’s current account surplus is expected to decline before turning negative due to falling oil prices.
Progress has been noted in policy measures focusing on fiscal consolidation and structural reforms. Key aspects of the draft 2025 budget have been agreed upon, emphasizing revenue mobilization and expenditure rationalization to enhance debt sustainability. Structural reforms will continue targeting improvements in social spending execution, debt management, transparency, governance, and economic diversification.
In response to funding challenges, Congolese authorities plan a voluntary debt reprofiling involving CFAF 2,314 billion (approximately US$3.8 billion) of local currency-denominated treasuries issued on regional markets. The IMF staff is working with authorities for more information on this initiative's implications for public finances and regional financial stability.
"The team is grateful to the authorities for the constructive discussions," said an IMF representative. Virtual discussions are set to continue aiming for a staff-level agreement pending approval by the IMF Executive Board.