The board of directors of the International Monetary Fund (IMF) has deemed “satisfactory” the progress made by the teams of Félix Tshisekedi in the implementation of the reforms provided for by the extended credit facility of 1.52 billion dollars approved in July 2021.
According to its estimates, “the budgetary results have been better than expected because the increase in budgetary revenues and external financing has made it possible to free up space for additional expenditure, especially in the area of investment, despite the accumulation of domestic arrears”.
Quantitative criteria almost achieved
The Fund will disburse $203 million “to meet the needs of funding of the balance of payment”, i.e. 653 million dollars transferred to Kinshasa over the past year.
DRC: Félix Tshisekedi at the goodwill of the IMF, so far…
Driven by rising metal prices, the country’s exports are expected to reach 45% of GDP this year, compared to 40.8% in 2021. And revenues and donations are now expected to reach 14% of GDP this year, their level of 2020, when a drop of two points was feared. GDP is expected to grow by 6.1% this year, despite the fallout from the Ukraine crisis.
The IMF puts pressure on Kinshasa to reduce the public wage bill, weighed down by “ghost” civil servants
However, the IMF teams regret that one of the five “structural benchmarks” was not fully respected: the publication of all mining contracts. One of them has not been made public, they said, without identifying which one. It should be noted that Kinshasa signed at the end of February an agreement with the Israeli businessman Dan Gertler for the transfer to the State of mining assets at the heart of many controversies and sanctions imposed by the United States. United. The publication of the exact content of the agreement reached with Gertler has since been demanded by the company civil Congolese.
Payroll and subsidies
The Fund has also encouraged the executive to continue “containment of current expenditure”, particularly with regard to fuel subsidies and civil service reforms, in order to “create space for priority investments”.
DRC: IMF believes in economic rebound
Between the lines, the multilateral institution is putting pressure on Kinshasa to reduce the public wage bill – weighed down by a good number of “ghost” civil servants – and subsidies. In 2020, public salaries represented 4,758 billion Congolese francs (about 2 billion euros), more than half of current expenditure. The IMF anticipates them at nearly 7,000 billion Congolese francs from next year.
By comparison, in 2020, investment expenditure (Capex) reached only 1,906 billion Congolese francs. Moreover, barely 251 million Congolese francs of Capex had been financed locally… Expenditure on subsidies had reached 2,243 billion Congolese francs in 2020. They are expected to increase by an additional 1,000 billion francs this year.