The Head of Mission of the International Monetary Fund (IMF) in the Democratic Republic of Congo (DRC), Mauricio Villafuerte, expressed his satisfaction and encouraged the Congolese government for its efforts to maintain the macroeconomic framework.

He expressed himself in a statement sanctioning the end of the mission carried out in the DRC from May 22 to June 5, received on Thursday at the ACP.

This mission which, falls within the framework of Article IV consultation for the DRC, noted that the macroeconomic stability of the DRC has been consolidated in 2018, thanks to the safe macroeconomic policies put in place since mid-2017, in a context of sharp deterioration of the terms of trade and political shocks as well as the withdrawal of donors support.

It is in this context, the same source reveals, that the mission congratulated the government on the fact that GDP growth went from 3.7% in 2017 to 5.8% in 2018, just as mining production has increased faster than expected, as a result of a sharp rise in cobalt prices, which offset the slowdown in non-extractive GDP growth.

"In just one year, up to December 2018, the annual inflation dropped from 54.7% to 7.2%, while the rate of exchange depreciation sharply slowed from 31% to 2.7%. The 2018 budget deficit was contained at 0.1 percent of GDP, compared with a surplus of 0.5 percent of GDP a year earlier, despite higher spending resulting from the elections last December that were fully covered by the government's own resources, " the source adds.

The IMF mission notes that GDP growth is expected to slow to 4.3 percent in 2019, due to a slowdown in mining activity in a context of weaker cobalt prices. By contrast, growth in the non-mining economy would more than double, due to increased public investment and post-election optimism.

In the medium term, global growth would be around 4% on the basis of current policies, although the implementation of structural reforms should stimulate growth, especially in the non-mining sector. After a further decline to 5.5% in 2019, inflation should stabilize around 5% in the medium term.

In this context, the staff team encouraged the Congolese authorities to accelerate the adoption of the anti-corruption bill and the law establishing an independent anti-corruption commission, as essential measures to anchor the credibility of the government in its quest for inclusive and sustained growth in the DRC.

DRC invited to continue efforts to increase reserves

The IMF mission invited the DRC government to make efforts to increase international reserves from their current low level of about three weeks of import coverage, given the high levels of dollarization of the financial system and the country's vulnerability to external shocks.

Discussions between the two sides, the source said, also focused on the need to continue strengthening controls based on the risks and quality of financial data, and to finalize the anti-money laundering and financing framework. Terrorism (AML/CFT) to further improve financial stability

Based on the preliminary findings of the mission, staff will prepare a report to be presented to the IMF's Executive Board for review and decision, subject to management approval, the statement said.

(CKS/Yes)