The Democratic Republic of Congo’s central bank kept its 2020 economic growth forecast unchanged at -2.4% because of the uncertainty over the COVID-19 pandemic.
“This situation has contributed to weakening growth prospects both globally and regionally,” the central bank said in a statement.
In April 2020, The executive board of the International Monetary Fund (IMF) approved a disbursement under the Rapid Credit Facility (RCF) equivalent to US$363.27 million to help the Democratic Republic of Congo (DRC) meet urgent balance-of-payments needs stemming from the COVID-19 outbreak.
DRC is experiencing a severe shock as a result of the COVID-19 pandemic.
The short-term economic outlook has deteriorated quickly because of the fall in mineral prices and the impact of necessary containment and mitigation measures.
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Congolese officials’ policy approach to tackling the pandemic has been firm, preparing a national response plan that includes an increase in health-related spending and putting in place measures to help contain the spread of the disease.
The pandemic is also dampening domestic revenue mobilisation and putting significant pressure on foreign exchange reserves.
Given the extraordinary nature of the pandemic and the scale of the economic fallout, the authorities have decided to accommodate the impact of the pandemic on the budget.
The deteriorating macroeconomic outlook and the additional fiscal pressures are creating an urgent balance-of-payments need.
The IMF support through RCF financing would help fill part of the financing gap, while additional support from other development partners is expected to close the remaining gap and ease budgetary financing needs.
Global growth
Global growth is projected at -4.9% in 2020, 1.9 percentage points below the April 2020 World Economic Outlook (WEO) forecast, published by the IMF.
The Fund said the COVID-19 pandemic has had a more negative impact on activity in the first half of 2020 than anticipated, and the recovery is projected to be more gradual than previously forecast.
Global growth for 2021 is projected to reach 5.4%.
Overall, this would leave 2021 GDP some 6.5 percentage points lower than in the pre-COVID-19 projections of January 2020.
The adverse impact on low-income households is particularly acute, imperilling the significant progress made in reducing extreme poverty in the world since the 1990s, the IMF has said.
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