Economical overview
With its vast natural riches of especially
minerals, Congo-Kinshasa could be one of the most
prosperous countries in the world. In addition, there
are huge assets on water and forest. But the country has
long been characterized by economic devastation, neglect
and armed conflicts. Congo is today one of the world's
most deprived states. However, increased demand for
minerals has boosted growth, even though it has leveled
off in recent years due to world market prices falling.
For the most part, Congo-Kinshasa's economy is based
on agriculture, but the colonial era's large commercial
crops have almost disappeared. Most of the population is
outside the formal economy and live on what they can
grow themselves. In the conflict-affected areas,
hundreds of thousands of people have been driven away
from their homes and forced to survive on aid.
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Countryaah.com:
Major imports by Democratic Republic of the Congo, covering a full list of top products imported by the country and trade value for each product category.
Much of the other economic activity goes on in the
cloud, without accounting or taxation, without
transparency and not infrequently illegal. This applies
not least to lucrative mining. A large part of the
minerals are extracted in areas and by groups that the
state power does not control. The situation has improved
somewhat since the end of the war in 2003 (see Modern
History), but the state is still losing out on great
wealth. Since 2005, several initiatives have been taken
in the outside world to regulate trade. Among other
things, attempts are made to trace the origin of the
minerals to prevent trade in "conflict minerals" and
"blood diamonds". One problem, however, is that even
high-ranking representatives of the authorities and the
military are often involved in the illegal handling (see
also Natural Resources and Energy).
At the time of independence, Congo was the second
most industrialized country on the continent, after
South Africa. However, the failure of the national
government and corruption, as well as the dictator
Mobutu Sese Seko's looting of the country (see Modern
History), gradually contributed to an economic collapse.
At the beginning of the 1990s, payments on foreign debt
were set at over US $ 10 billion. According to recent
estimates, Mobutu itself had embezzled around $ 5
billion from the Treasury. During the 1990s, GDP fell on
average by just over 6 percent per year.
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Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including DRC which represents the country of Democratic Republic of the Congo. Check
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Despite the neglect, the influx of foreign aid
continued for decades, including from the World Bank and
the International Monetary Fund (IMF). One reason was
that the US saw Mobutu as an important ally against
communism in Africa. The aid was withdrawn in the early
1990s, when the Cold War had ended and Mobutu's
eccentric personal cult began to appear troublesome in
the western world. The World Bank declared the then
Zaire bankruptcy in 1994. The political turmoil in the
1990s also frightened many foreign experts and prevented
foreign companies from investing in the country. The
corruption made sustainable business impossible. The
riots and looting contributed to the collapse of the
economy.
In the early 2000s, donors returned after a peace
agreement was concluded and then-President Joseph Kabila
had initiated economic reforms. Among other things, a
liberalization of the mining industry was carried out.
Some described it as a sale of national assets: in
2004-2005, 75 percent of copper assets were sold to
foreign interests.
In addition to the World Bank, the EU, Belgium and
France are among the most important donors.
China's ever-stronger presence and large commodity
famines have caused concern among Western countries. In
February 2009, it became clear that Congo-Kinshasa would
receive a $ 200 million crisis loan from Western donors.
The clear sign of the loan was given despite the fact
that many of these donor countries opposed an agreement
between Congo-Kinshasa and China that would give Chinese
mining rights in exchange for infrastructure investments
worth $ 9 billion. Chinese companies promised, among
other things, to build roads, railways and hospitals to
share copper and cobalt deposits. Objections from the
IMF in November of the same year prompted a revision of
the settlement with the Chinese, which meant it was cut
to $ 6 billion. The IMF and Western donors would instead
ease Congo-Kinshasa's debt burden.
In 2010, Congo also received clarification from the
World Bank and the IMF on a debt cancellation program
under the Heavily Indebted Poor Countries (HIPC)
Initiative. Congo-Kinshasa was considered to have
fulfilled the conditions through efforts to reduce
corruption and increase transparency in the mining and
oil sectors. Later in the year, Congo also got clear
with a debt write-off of the so-called Paris Club (an
informal association of 19 rich countries) and Brazil.
The vast natural resources continue to attract
foreign companies. But new struggles in 2011–2013
reminded us of the uncertain situation. The legitimacy
of the government appears to many to be questionable.
Congo is in the bottom tier of the world's countries
when the World Bank ranks investors' risks (see
Democracy and Rights).
Previously long periods of high inflation have led to
a dollarization of the economy. US Dollars are the only
currency in demand in all contexts except in ordinary,
everyday trading. However, inflation has fallen to just
over 1 percent. Growth was around 7 percent in 2010-2013
and was up 9 percent in 2014. Subsequently, growth
slowed down, much as a result of low world market prices
for minerals. But even though GDP has continued to grow,
people are not getting much better, as the population is
growing at almost the same rate as the economy.
FACTS - FINANCE
GDP per person
US $ 562 (2018)
Total GDP
US $ 47 228 million (2018)
GDP growth
5.8 percent (2018)
Agriculture's share of GDP
19.1 percent (2018)
Manufacturing industry's share of GDP
18.1 percent (2018)
The service sector's share of GDP
32.7 percent (2018)
Inflation
5.5 percent (2019)
Government debt's share of GDP
15.3 percent (2018)
External debt
US $ 5 128 million (2017)
Currency
Congolese Franc
Merchandise exports
US $ 15 967 million (2018)
Imports
US $ 14 973 million (2018)
Current account
- US $ 2,169 million (2018)
Commodity trade's share of GDP
30 percent (2018)
Main export goods
diamonds, gold, copper, cobalt, wood, crude oil,
coffee
Largest trading partner
China, South Africa, Belgium, USA
2009
December
Hundreds of dead in LRA massacres
The LRA guerrillas are massacring hundreds of
civilians in villages in the Haut-Uélé province in the
northeast.
October
UN force is criticized
UN force Monuc receives criticism from human rights
organizations for not sufficiently protecting the
civilian population during the army's offensive against
the Hutu militia FDLR. Sexual violence was even more
brutal than before in the areas where the offensive took
place.
August
The situation in the east is getting worse
360,000 people in Orientale province are reported to
have escaped attacks from the Ugandan LRA guerrilla
since the beginning of the year.
April
Violence is increasing in Nordkivu
The violence between the FDLR hutumilis and the army
is increasing in Nordkivu.
March
New peace agreement
The government and the CNDP conclude a peace
agreement, which means that the CNDP will be transformed
into a political party, the former rebels will be
granted amnesty and former rebels will be included in
the national army and a new police force. The agreement
will also allow hundreds of thousands of refugees to
return home.
February
Rwandan troops leave
The Rwandan troops begin to leave Congo-Kinshasa.
Hutumilisen FDLR is rapidly recovering lost land and
over 30,000 civilians are fleeing.
January
Nkunda is arrested in Rwanda
Several thousand Rwandan government soldiers enter
Congo-Kinshasa to fight the FDLR, according to an
agreement with the Congolese government. Two days later,
CNDP leader Laurent Nkunda (see August 2007)
is arrested in Rwanda.
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