Democratic Republic of Congo Economic Outlook
- The growth of the Congolese economy slowed in 2015, falling to 7.7% from 9.2% in 2014, a trend set to continue in 2016 (7%), with a recovery expected to start in 2017 (8%).
- Poverty remains widespread, although the country has made significant progress in implementing the Millennium Development Goals (MDGs), moving up 11 spots in the 2014 world ranking of the Human Development Index (HDI).
- The country faces significant challenges in the planning and financing of urban development in order to improve quality of life and to capitalise on the opportunities provided by urbanisation.
In 2015, economic growth was 7.7%, down from 9.2% in 2014, and below the 10.3% growth initially projected. The growth was supported by the extractive and manufacturing industries, transport, and telecommunications. Inflation was held at 0.8% and the exchange rate of the Congolese franc (CDF) to the United States dollar (USD) remained stable, fluctuating by 0.2%. Despite the drastic fall in the price of raw materials,1 macroeconomic stability was preserved due to a tightening of tax revenue, international reserves and an increase in the current account deficit. Economic activity is expected to slow slightly to 7.0% in 2016 before climbing to 8.0% in 2017, due to a recovery of mining prices, expected from 2017, and the positive effects of structural reforms and the rebuilding of infrastructure. To strengthen the economy’s stability and resilience to shocks, in January 2016 the government adopted 28 urgent measures, and as part of the strategic national plan for development (PNSD) currently being drawn up, it decided to diversify the country’s economy and to broaden the value creation chain.
On social issues, although the Democratic Republic of the Congo (DRC) did not achieve the Millennium Development Goals (MDGs) by the end of 2015, it did make significant progress, although considerable challenges still remain. Despite the fragile political and security context, the incidence of poverty fell from 80% in 1990 to 63.4% in 2012. The continual increase in the national budget allocated to social sectors led to an increase in the enrolment, literacy and primary school-completion rates; a significant reduction in infant and maternal mortality; and improved electricity provision and access to water, sanitation and housing. This progress led to the country improving on the Human Development Index (HDI), moving from 0.329 in 2000 to 0.439 in 2014, thus climbing 11 spots in the 2014 world ranking. The holding of free, democratic elections planned for 2016, within the constitutional deadline, is the country’s main political challenge to consolidate the achievements of the democratic process that began in 2006.
Although urbanisation is viewed as an opportunity by the Congolese authorities, it faces a real challenge in terms of the planning and financing of urban development. Urban areas dominate the national economy and offer better living conditions than rural areas. However, there are risks associated with current urbanisation trends in the DRC: an increase in unplanned and informal neighbourhoods, poor quality of urban transport and congestion in cities, and limited access to social infrastructure. The country does not have a national urbanisation strategy, although it does have some measures and ongoing national initiatives which could directly or indirectly contribute to urban development, especially the land-use planning reform, construction projects for special economic zones and agro-industrial parks.