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

British Fighters On Frontline of ISIS Information War

It’s estimated that several hundred British citizens are fighting for Islamic State alongside other foreign Jihadists More

Audio Hit Song Delivers Ebola Message in Liberia

'Ebola in Town' has danceable beat, while also delivering serious message about avoiding infection More

Video New Technology Gives Surgeons Unprecedented Views of Patients’ Bodies

Technology offers real-time, interactive, medical visualization and is multi-dimensional 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.
Native Bees May Help Save Cropsi
X
Deborah Block
August 22, 2014 12:23 AM
U.S. President Barack Obama has called for a federal strategy to promote the health of bees that have been declining. The honeybee has been waning due to parasites, disease and pesticides. Wild bees may be used to take over their role as crop pollinators. Scientists first need to learn a lot more about wild bees, says biologist Sam Droege, who is pioneering the first national inventory on native bees. VOA’s Deborah Block went to his research laboratory in Beltsville, Maryland, to bring you more.
Video

Video Native Bees May Help Save Crops

U.S. President Barack Obama has called for a federal strategy to promote the health of bees that have been declining. The honeybee has been waning due to parasites, disease and pesticides. Wild bees may be used to take over their role as crop pollinators. Scientists first need to learn a lot more about wild bees, says biologist Sam Droege, who is pioneering the first national inventory on native bees. VOA’s Deborah Block went to his research laboratory in Beltsville, Maryland, to bring you more.
Video

Video US Defense Officials Plan for Long-Term Strategy to Contain Islamic State

U.S. defense officials say American air strikes in Iraq have helped deter Islamic State militants for the time being, but that a broad international effort is needed to defeat the extremists permanently. Defense Secretary Chuck Hagel warned Thursday that the group formerly known as the Islamic State in Iraq and the Levant, or ISIL, is better organized, and financially and militarily stronger than any other known terrorist group. Zlatica Hoke has more.
Video

Video Drug-Resistant Malaria Spreads in Southeast Asia

On Thailand’s border with Myanmar, also known as Burma, a malaria research and treatment clinic is stepping up efforts to eliminate a drug-resistant form of the parasite - before it spreads abroad. Steve Sandford reports from Mae Sot, Thailand.
Video

Video Gaza Conflict, Hamas Popularity Challenge Abbas

The Palestinian unity government of Mahmoud Abbas has failed to convince Hamas to agree to Egyptian-negotiated terms with Israel on a Gaza cease-fire. VOA State Department Correspondent Scott Stearns reports on what the Gaza conflict means for President Abbas, with whom U.S. officials have worked for years on a two-state solution to the Israeli-Palestinian conflict.
Video

Video Nigeria's 'Nollywood' Movie Industry Rolls in High Gear

Twenty years after its birth in a video shop in Lagos, Nigeria's "Nollywood" is one of the most prolific film industries on earth. Despite low budgets and whirlwind production schedules, Nigerian films are wildly popular in Africa and industry professionals say they hope, in the future, their films will be as great in quality as they are in quantity. Heather Murdock has more for VOA from Lagos.
Video

Video UN Launches 'Biggest Aid Operation in 30 Years' in Iraq

The United Nations has launched what it describes as one of the biggest aid operations in 30 years in northern Iraq, as hundreds of thousands of refugees flee the extremist Sunni militant group calling itself the Islamic State. As Kurdish and Iraqi forces battle the Sunni insurgents, the fighting has forced more people to flee their homes. Kurdish authorities say the international community must act now to avert a humanitarian catastrophe. Henry Ridgwell reports for VOA from London.
Video

Video Cambodian American Hip Hop Artist Sings of Personal Struggles

A growing underground movement of Cambodian American hip hop artists is rapping about the struggles of living in urban America. Most, if not all of them, are refugees or children of refugees who came to the United States from Cambodia to escape the Khmer Rouge genocide of the 1970s. Through their music, the artists hope to give voice to immigrants who have been struggling quietly for years. Elizabeth Lee reports from Long Beach, California.
Video

Video African Media Tries to Educate Public About Ebola

While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.

AppleAndroid