The country has witnessed an improvement in its macro-economic situation over the last three years with an increase in real GDP growth from 2.2% in 2005 to 3.8% in 2007 due, in part,  to a gradual return to stability and economic recovery. However, economic performance remains below expectations, given the country's  economic potential.

The country's principal source of riches is the diversity of its natural resources and its large forest, as well as favourable agro-pastoral conditions and mining potential. The primary sector - agriculture, livestock breeding, hunting and fishing, forestry, and mining  - accounts for about 54% of GDP. The forestry sector is the main source of export earnings with 53%,  followed by the diamond sector with 39%. The country has an agricultural potential due to its arable land and favourable hydrographic network characterized by abundant fresh water.

The country's trade sector covers a range of activities and this sector accounts for about 30% of country's GDP.  The embryonic industrial sector is concentrated in Bangui and only accounts for 12% to country's GDP. The country has several sources of energy - thermal, hydroelectric and renewable energy - but this significant energy potential is scarcely tapped and demand for electric energy is unfortunately unmet.

The social indicators for the CAR are among the weakest in Sub-Saharan Africa, and their deterioration over the past twenty years makes it unlikely that the country will attain the Millennium Development Goals (MDG) by 2015. The incidence of poverty which was estimated at 67.2 % in 2003 has scarcely changed in the last few years. The CAR is ranked 171st out of 177 countries on the Human Development Index (HDI). Life expectancy was estimated at 44.7 years in 2007, about ten years below the African average. The HIV/AIDS prevalence rate, which was 6.2% in 2006 for those in the 15-49 age bracket, is the highest in the CEMAC zone.  Gender disparity is very high and put the country 153th out of 177 countries in terms of the Gender Development Index in 2005.

The CAR has a Poverty Reduction Strategy Paper (PRSP) covering the 2008-2010 period. The PRSP was prepared according to a participatory approach, and validated by the development partners of the CAR in October 2007. It comprises four pillars: (i) restore security, consolidate peace and prevent conflicts; (ii) promote good governance and the Rule of Law; (iii) rebuild and diversify the economy ; and (iv) develop human capital.

The Bank Group's Strategy

The proposed operations programme of the Bank is set out in the 2007-2008 Joint Interim Strategy Note (JISN) of the Bank and the World Bank. The objective of the JISN is to assist the Central African Republic (CAR) to recover and lay the foundation for sustained and shared economic growth. Since the implementation of the 2007-2008 JISN is nearing completion, the Bank and the World Bank have started preparing their new Joint Country Partnership Strategy Paper, (JCPSP) which will replace the JISN as from 2009. The indicative objective of the 2009-2013 JCPSP is to promote strong economic growth and create jobs, through two primary pillars:

• Consolidate the capacities of the State and economic governance
• Support the development of basic infrastructure, including rural development infrastructure

The Bank portfolio in CAR, which is being reconstituted since the re-engagement of the Bank in 2006, is estimated at UA 11.8 million. It comprises a Project to support the Rehabilitation of Economic Planning Capacity approved in July 2006 (UA 3.3 million); and an Economic Reform Support Programme, Phase II (PARE II) approved in October 2008 (UA 9.5 million). In addition to these two projects there are the Regional Transport Facilitation Program approved in July 2007 (UA 108.8 million, including UA 27.8 million from an ADF grant to the CAR) ; the Drinking Water Supply and Sanitation (DWSS) Study on 16 centres for  the African Water Facility approved in August 2007 (UA 1.336 million); and support for the PRSP financed by a Japanese grant (US$ 347,131).