Chad Economic Outlook
- The economy is expected to rebound in 2012 when a refinery and new industrial units come into operation.
- This upsurge in activity will help improve the public finances and the external position.
- At 34% in urban areas unemployment hits hardest young people and especially those seeking their first jobs.
Growth should accelerate in 2012, driven partly by the coming on stream of an oil refinery and partly by the non-oil sector where plans for new electricity and cement plants are under way. Growth should fall back in 2013 as oil production progressively decreases but this slowdown could be compensated for by a rise in oil prices and a better performance in the cotton ginning sector and the cross-frontier cattle trade.
Attempts to control and rationalise current expenditure need to be maintained by the government.
Inflation should stay below the 3% limit set by the convergence criteria of the Central African monetary and economic community (CEMAC) for 2012/13. Chad’s economic prospects depend on a number of factors. They include management of the fall-out from the conflict in Libya, the conclusion of an agreement with the International Monetary Fund (IMF), the reaching of completion point of the Heavily Indebted Poor Countries (HIPC) initiative, worsening economic relations with China, and managing the consequences of climate change.
It is estimated that 55% of Chad’s 11.2 million inhabitants live in poverty, the proportion reaching 87% in the countryside. The arrival of the oil era has not produced the wealth for other sectors that might have enabled them to create enough jobs to meet the demand from unemployed young people. Nor has the government used oil revenues to set up the training structures necessary for the development of employment in the oil extraction industry.
