News / Africa

Congo Could Have Most of Debt Forgiven by June

$11-billion debt relief comes in wake of President Kabila moving to reform economy, better control spending

The Democratic Republic of Congo could have the bulk of its external debt forgiven by June in a deal with foreign donors and the International Monetary Fund.

Repaying nearly $11-billion of debt is a heavy burden for an economy still recovering from fighting between 1998 and 2003 that killed more than 3 million people.

Economic growth last year was less than three percent, depressed by a larger-than-expected slowdown in mining and construction. Inflation last month was estimated to be nearly 50 percent in a country with an average per capita income of just more than $170 a year.

But President Joseph Kabila's moves to reform the economy and better control spending have the Democratic Republic of Congo on the verge of an historic deal that could see that nearly $11-billion debt slashed to just more than $2 billion.

International Monetary Fund mission chief Brian Ames says "steadfast actions" are still needed, but the country appears on target to secure debt forgiveness by its 50th independence anniversary on June 30th.

Ames says if the Kabila government continues to take necessary steps, the IMF and World Bank can prepare all the necessary documents for that plan to be in place by the end of June.

Seven years after a peace deal ended most of the fighting, Central Bank Governor Jean-Claude Masangu Mulongo says continuing violence in the eastern Kivu regions means Congo is still not fully benefiting from its mineral wealth.


Masangu Mulongo says Congo needs to find a way to manage its security problems, while at the same time keeping its macroeconomic framework on track.

The International Monetary Fund says President Kabila is improving revenue collection, better managing state spending, and making it easier for businesses to operate. Ames says central-bank reforms should help reduce inflation and increase foreign currency reserves.

If approved, Masangu Mulongo says the debt forgiveness plan would cut Congo's annual debt servicing from $920-million to just more than $200-million.

Masangu Mulongo says that is important because it would allow Congolese to spend the next 50 years without the burden of more than $10-billion of debt.

The United Nations plans to begin withdrawing some of its peacekeepers from western Congo by June, which could put more of a strain on the national army to provide more of its own security. But the bulk of the 20,000-member U.N. force will remain in the east at least until next year.

President Kabila is also finalizing a $9-billion mineral deal with China that is Beijing's largest investment in Africa, giving state-owned firms the right to develop copper and cobalt mines in exchange for building roads, railways, universities, airports, and hospitals.

The IMF decision on debt relief was delayed because of concerns about the conditions of loans in that Chinese mineral deal. The plan was modified to address those concerns, and Congo is again moving forward toward $70-million of a three-year, $550-million package of IMF loans due to be repaid at concessionary rates after 2016.

You May Like

Americans Celebrate Thanksgiving

Feasts centering on turkeys with an array of traditional sides and desserts are part of the holiday's traditions, which falls on the fourth Thursday in November More

Video For Obama, Ferguson Violence is a Personal Issue

With two years left in term, analysts say, president has less to lose by taking conversation on race further More

Video Italian Espresso Expands Into Space

When Italian astronaut Samantha Cristoforetti headed for the ISS, her countrymen worried how she would survive six months drinking only instant coffee More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Aung San Suu Kyi: Myanmar Opposition to Keep Pushing for Constitutional Changei
X
November 24, 2014 10:09 PM
Myanmar opposition leader Aung San Suu Kyi says she and her supporters will continue pushing to amend a constitutional clause that bars her from running for president next year. VOA's Than Lwin Htun reports from the capital Naypyitaw in this report narrated by Colin Lovett.
Video

Video Aung San Suu Kyi: Myanmar Opposition to Keep Pushing for Constitutional Change

Myanmar opposition leader Aung San Suu Kyi says she and her supporters will continue pushing to amend a constitutional clause that bars her from running for president next year. VOA's Than Lwin Htun reports from the capital Naypyitaw in this report narrated by Colin Lovett.
Video

Video Mali Attempts to Shut Down Ebola Transmission Chain

Senegal and Nigeria were able to stop small Ebola outbreaks by closely monitoring those who had contact with the sick person and quickly isolating anyone with symptoms. Mali is now scrambling to do the same. VOA’s Anne Look reports from Mali on what the country is doing to shut down the chain of transmission.
Video

Video Ukraine Marks Anniversary of Deadly 1930s Famine

During a commemoration for millions who died of starvation in Ukraine in the early 1930s, President Petro Poroshenko lashed out at Soviet-era totalitarianism for causing the deaths and accused today’s Russian-backed rebels in the east of using similar tactics. VOA’s Daniel Shearf reports from Kyiv.
Video

Video Hong Kong Protests at a Crossroads

New public opinion polls in Hong Kong indicate declining support for pro-democracy demonstrations after weeks of street protests. VOA’s Bill Ide in Guangzhou and Pros Laput in Hong Kong spoke with protesters and observers about whether demonstrators have been too aggressive in pushing for change.
Video

Video US Immigration Relief Imminent for Mixed-Status Families

Tens of thousands of undocumented immigrants in the Washington, D.C., area may benefit from a controversial presidential order announced this week. It's not a path to citizenship, as some activists hoped. But it will allow more immigrants who arrived as children or who have citizen children, to avoid deportation and work legally. VOA's Victoria Macchi talks with one young man who benefited from an earlier presidential order, and whose parents may now benefit after years of living in fear.
Video

Video New Skateboard Defies Gravity

A futuristic dream only a couple of decades ago, the hoverboard – a skateboard that floats above the ground - has finally been made possible. While still not ready for mass production, it promises to become a cool mode of transport... at least over some surfaces. VOA’s George Putic reports.
Video

Video Falling Gas Prices Impact US Oil Extraction

With the price of oil now less than $80 a barrel, motorists throughout the United States are benefiting from gas prices below $3 a gallon. But as VOA’s Kane Farabaugh reports, the decreasing price of petroleum has a downside for the hydraulic fracturing industry in the United States.
Video

Video Tensions Build on Korean Peninsula Amid Military Drills

It has been another tense week on the Korean peninsula as Pyongyang threatened to again test nuclear weapons while the U.S. and South Korean forces held joint military exercises in a show of force. VOA’s Brian Padden reports from the Kunsan Air Base in South Korea.
Video

Video Mama Sarah Obama Honored at UN Women’s Entrepreneurship Day

President Barack Obama's step-grandmother is in the United States to raise money to build a $12 million school and hospital center in Kogelo, Kenya, the birthplace of the president's father, Barack Obama, Sr. She was honored for her decades of work to aid poor Kenyans at a Women's Entrepreneurship Day at the United Nations.
Video

Video Ebola Economic Toll Stirs W. Africa Food Security Concerns

The World Bank said Wednesday that it expects the economic impact of the Ebola outbreak on the sub-Saharan economy to cost somewhere betweenf $3 billion to $4 billion - well below a previously-outlined worst-case scenario of $32 billion. Some economists, however, paint a gloomier picture - warning that the disruption to regional markets and trading is considerable. Henry Ridgwell reports from London.
Video

Video Chaos, Abuse Defy Solution in Libya

The political and security crisis in Libya is deepening, with competing governments and, according to Amnesty International, widespread human rights violations committed with impunity. VOA’s Al Pessin reports from London.
Video

Video US Hosts Record 866,000 Foreign Students

Close to 900,000 international students are studying at American universities and colleges, more than ever before. About half of them come from Asia, mostly China. The United States hosts more foreign students than any other country in the world, and its foreign student population is steadily growing. Zlatica Hoke reports.

All About America

AppleAndroid