Republic of Congo - Country Brief
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Country Brief

History                                                              Country Brief Last updated March 2009

Since Congo's independence in 1960, its history has been marked by a series of conflicts, including three presidential coups and one presidential assassination between 1958 and 1979. In 1968, a military government came to power and later established a Marxist-Leninist regime. The Sovereign National Conference, which took place from February 25 to June 10, 1991, restored democracy to the country, paving the way for free and transparent elections. Between 1993 and 1999, the country was ravaged by three civil wars.

A political liberalization process took place in November/December 1999 (the ceasefire agreements called for the reestablishment of political parties), and a new constitution was adopted in January 2002, which was followed by presidential, legislative, local, and senatorial elections. These elections created an environment for reconciliation and dialogue, with the representation of opposition parties in Parliament. When the 2007 legislative elections were held, the presidential majority (AMP) won 125 of the 137 seats, a victory that gave it a comfortable parliamentary majority.

This progress was strengthened by the March 2003 signing of a peace agreement between the Government and virtually all remaining rebel groups. This agreement enabled the Government to launch a program to demobilize former combatants, which started in February 2009 in the Pool Region.

The presidential appointment on May 21, 2007 of Frédéric Bintsamou—also known as Pastor Ntumi, Chair of the National Council of Republicans (Conseil National des Républicains, CNR)—to the position of Delegate General for the promotion of peace and war reparations remains an issue as Frédéric Bintsamou has not yet taken office.

Efforts to strengthen the peace that led to the installation of democratic institutions continue. Parliamentary elections were held in June and August 2007, local and municipal elections on June 29, 2008, while senatorial elections took place on August 5, 2008. Presidential polls are scheduled to take place in July 2009.

Economy

The economy of the Republic of Congo is heavily dominated by the oil sector, which in 2008 accounted for approximately 65 percent of its GDP, more than 92 percent of its exports, and 85 percent of state revenue. Oil output was estimated at 86.6 million barrels in 2008, up from 81.7 million barrels in 2005. Current prospects indicate that oil output will continue to rise until 2010 (thanks to the exploitation of new oil fields), then decline in 2011 as old fields get depleted.

The non-oil sector, in particular industry, remains very underdeveloped, despite Congo's great potential. Successive post-independence governments have not, however, been able to use the country's great economic potential to achieve tangible improvements in the living conditions of the majority of the population.

Once ranked as a lower middle-income country, per capita income in Congo has declined steadily since the late 1980s. This situation was exacerbated by the effects of the war that ravaged the country during the 1990s. These conflicts have exacted a heavy toll on the country's infrastructure. Entire provinces are without drinking water and a number of institutions lie in ruins. The poverty rate was estimated at close to 50 percent in 2005, after peaking at close to 70 percent in the period immediately following the conflicts.

The United Nations human development index ranks Congo 144 th out of a total of 177 countries. According to UNICEF, 11 percent of children under age 15 are orphans, 60,000 women and girls have been victims of rape, and 5,000 children fought during the war. In 2005, close to 4.7 percent of the Congolese population in the 15 – 49 age group was estimated to be living with HIV/AIDS. The primary enrolment rate dropped from 90 percent in 1990 to 40 percent in 2000, and during the same period life expectancy declined, going from roughly age 52 in the early 1990s to age 48.6 in 2002. The unemployment rate among the active population is estimated at close to 50 percent, with young people in particular being the hardest hit.

As a result of the work done by the authorities in 2003-2004, Congo managed to conclude an agreement with the International Monetary Fund under the Poverty Reduction and Growth Facility in December 2004. Congo also reached the decision point under the HIPC Initiative in March 2006. The main reforms supported by the international community under this program are poverty reduction; strengthening the public finance management system (including public investment management); improving governance, particularly in the area of natural resource management (including oil and forest resources); and combating corruption, among others.

The Government is committed to reaching the completion point under the HIPC initiative as soon as possible. Nevertheless, major challenges remain in the oil sector as well as in public procurement reform.

External Debt

Congo is a heavily indebted country, which makes it eligible for the HIPC Initiative. Its public and publicly guaranteed external debt stood at US$9.2 billion in nominal terms at end-December 2004 (US$9 billion in net present value (NPV) terms). This level of debt in NPV terms corresponds to 806 percent of fiscal revenue, 338 percent of exports, and 255 percent of GDP. Approximately two-thirds of Congo’s external debt is owed to multilateral (8 percent) and official bilateral (59 percent) creditors. The remaining debt (33 percent) is owed to commercial creditors.

Since reaching the decision point under the HIPC Initiative, Congo has benefitted from interim debt relief from a number of donors, among them the World Bank. The Government is continuing efforts to normalize its relations with the Paris Club and with the London Club.

In December 2008, the Paris Club cancelled US$634 million in debt and rescheduled US$119 million. As a result, in December 2008 the country’s debt stood at 76.9% of GDP, down from 255% at the time of the decision point.

World Bank Role

The Bank resumed its activities in Congo in 2001 in the context of a Transitional Support Strategy (TSS), which was submitted for discussion by the Board on January 16, 2001.

A new TSS, discussed by the Board in September 2003, was aimed at helping Congo break the vicious cycle of conflict. It revolves around four strategic elements: (a) supporting the growth and diversification program for the Congolese economy; (b) helping enhance and reposition the public sector; (c) mitigating social risks, in the short- and medium-term, faced by Congo; and (d) increasing resources for peace and development.

The Interim Strategy Note for the Republic of Congo adopted on July 31, 2007 for the period 2007-2009, focuses on two main areas: (i) improving governance and transparency in the oil and non-oil sectors; and (ii) expanding access to basic social services by the poor, in order to begin to lay the foundation for equitable growth.

In order to support the development of Congo, the Bank is currently funding five projects, representing a total volume of commitments of US$172 million (including $144 million in grants).

Preparations for a new Country Partnership Strategy are currently underway, with Board approval expected in May 2009. The new strategy will rest on two pillars—the diversification of the economy and the delivery of services to citizens.




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