DRC: towards the signatory of a three-year program with the IMF

The headquarters of the International Monetary Fund (IMF) in Washington, April 8, 2019. REUTERS / Yuri Gripas / File Photo

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After a three-week marathon of negotiations, delegations from the Congolese government and the International Monetary Fund (IMF) agreed on the content of a three-year program.

If this agreement is validated by the management and the Board of Directors of the IMF, the DRC could begin to receive a first disbursement from mid-June on the some 1.5 billion dollars planned.

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President Félix Tshisekedi has been

trying for

more than a year and a half

to obtain the opening of these negotiations and the signing of a program with the IMF.

It must be said that the stakes are enormous.

First of all, the amount of 1.5 billion dollars for a State which is desperately seeking to increase these revenues is substantial, but the signing of this program, if it occurs in July, could pave the way for other financing. .

With this program, the DRC would make many commitments.

Reinstatement of VAT

First, there are all those that the government has not been able to achieve so far.

Whether it is the reform of the governance of the Central Bank, with in particular the establishment of a new Board of Directors which must be done before the signature, but also the reinstatement of VAT, which will be part of a broader tax reform.

Finally, there are transparency efforts with the continued

publication of mining contracts

.

This program aims to increase revenues and redirect them towards social spending.

One aspect concerns in particular the management of the State wage bill and the question of pensions.

100 hours of trading

This agreement was obtained in record time, three weeks, after more than 50 working sessions and more than 100 hours of negotiations.

Several points that almost made the negotiations fail: the fulfillment of transparency commitments on the management of Covid funds and above all, the Central Bank continued to guarantee commitments made by the State vis-à-vis the private sector.

The government has made a commitment not to do it again.

This agreement is obviously welcomed by the Minister of Finance, Nicolas Kazadi.

" 

It is important to give a signal that attests to our desire to bring the DRC back to good economic and financial practices,

 " he told RFI.

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• DRC

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