Falling copper production has led us to revise down our forecasts for real GDP growth in the Democratic Republic of the Congo in 2016. Even so, increasing production in other commodity sectors and a relatively stable currency will ensure growth remains robust.
The Democratic Republic of the Congo's coffers face another tough year in 2016, as revenues will fall further on the back of a decrease in copper production. A packed election schedule, political unrest, and regional administrative reforms will prevent the government from cutting expenditure.
Despite our expectations for inflation to rise in 2016, we do not believe that the Democratic Republic of the Congo's central bank will raise interest rates. Inflation will remain low by regional standards and will likely decrease in 2017 as copper production picks up.
The Democratic Republic of the Congo's current account deficit will trough in 2016 as exports continue to suffer from an unproductive copper industry, and imports climb on the back of investment in the broader mining sector and currency stability.
The Democratic Republic of the Congo's forthcoming electoral cycle will be marred by confusion and delays, thanks to the government's lack of willing and effort to make the necessary preparations for the presidential vote, scheduled for November 2016. In turn, this will tarnish the eventual result and weigh on political stability over our short and medium-term outlook.
The copper price remains well below USD5,000/tonne, forcing more mines to cease operations and make redundancies.
A major flare-up in violence as the 2016 elections approach worsens what is already a questionable investment climate.
|e/f = BMI estimate/forecast. Source: National Sources|
|Real GDP growth, % y-o-y||8.5||8.8||7.4||7.0|
|Nominal GDP, USDbn||32.7||36.8||40.4||42.7|
|Consumer price inflation, % y-o-y, eop||1.1||1.0||1.7||3.0|
|Exchange rate CDF/USD, eop||919.75||911.00||930.00||965.04|
|Budget balance, % of GDP||4.8||-1.4||-3.8||-4.5|
|Current account balance, % of GDP||-9.3||-9.9||-10.6||-12.4|
The Democratic Republic of Congo Country Risk Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in Congo, Dem. Rep.. It is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market.
An influential new analysis of Congo, Dem. Rep.'s economic, political and financial prospects through end-2019, just published by award-winning forecasters, BMI Research.
- Forecast the pace and stability of Congo, Dem. Rep.'s economic and industry growth through end-2019.
- Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.
- Assess the critical shortcomings of the operating environment that pose hidden barriers and costs to corporate profitability.
- Contextualise Congo, Dem. Rep.'s country risks against regional peers using BMI's country comparative Risk Index system.
- Evaluate external threats to doing business in Congo, Dem. Rep., including currency volatility, the commodity price boom and protectionist policies.
BMI provides our fully independent 5-year forecasts for Congo, Dem. Rep. through end-2019 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.
Economic Outlook Contents
The Democratic Republic of Congo Country Risk Report features BMI's forecasts with supporting analysis for 2015 through to end-2019, set against government views and BMI's evaluation of global and regional prospects.
Key Areas Covered:
- Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.
- BMI's comprehensive Risk Index system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.
- Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).
- Balance of Payments - trade and investment, current and capital account.
- Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
- Exchange Rate Policy - currency controls, foreign investment flows, exchange rates and foreign exchange reserves.
- Fiscal Policy - macroeconomic strategy and policies, government finance and tax reforms.
- Foreign Direct Investment - approvals, inflows and climate.
- External Debt - debt profile (short and long-term plus public and private sector obligations).
- Global Assumptions - forecasts for each year to end-2019 covering: major commodities, growth in key regions, inflation, and interest and exchange rates, in the United States, Japan, China and the eurozone.
- Rely upon BMI's 100% independent forecast scenarios for Congo, Dem. Rep. and underlying assumptions - we take no advertising and are privately-owned.
- Exploit the benefits of BMI's comprehensive and reliable macroeconomic database on Congo, Dem. Rep., sourced and fully maintained by BMI from an extensive network of private sector, government and multilateral contacts.
- Gain key insights into the current and future direction of government economic policy, which could significantly affect your company's business prospects, from BMI's team of analysts and economists.
What are the political risks to doing business in Congo, Dem. Rep. over the next 5-years?
BMI's Congo, Dem. Rep. country Risk Index evaluates the short- and medium-term threats to political stability.
Political Outlook Contents
- SWOT Analysis for the Congo, Dem. Rep. Market - Political Strengths, Weaknesses, Opportunities and Threats facing Congo, Dem. Rep..
- Political Stability and Risk Assessment - BMI's Risk Index assesses explicit short- and long-term risks to political stability; latest positioning and trends for Congo, Dem. Rep.'s risk are compared with regional and global averages.
- Current Administration and Policy-making BMI assesses the threats to the continuity of economic policy, and likely changes to the business operating environment.
- Long-Term Political Outlook BMI examines the structural risks to the stability of Congo, Dem. Rep.’s political system and the dominant public policy issues likely to affect decision-makers, and outlines scenarios for how the state could evolve in the medium to long term.
- Benchmark Congo, Dem. Rep.'s risk profile against its neighbours, the global and regional average, allowing easy comparison of risks between key business markets.
- Identify, evaluate and anticipate political and security risks to the business environment, and to your company's current operations and future plans.
- Gain valuable insights into government and policy-making, through BMI's specialist team of analysts and economists, and their network of private and public sector sources.
What are the current operational risks and difficulties associated with doing business in Congo, Dem. Rep.?
The Operational Risk section gives an evaluation of current risks and difficulties associated with operating in the market. It also provides a brief overview of the regional Operational Risk Index which benchmarks Congo, Dem. Rep. against its neighbours.
Operational Risk Contents
The chapter provides a summary of the main threats in the country, within:
- Labour Market Risk (Education; Availability of Labour; and Labour Costs)
- Logistics Risk (Market Size and Utilities; Quality and Extent of the Transport Governance)
- Trade and Investment Risk (Economic Openness; Government Intervention; and Legal Risks)
- Crime and Security Risk (Crime; Terrorism; and Interstate Conflict risks).
The report also drills down in greater depth to address key issues in one of the following segments most critical to the market:
- Transport network, economic openness, cost and availability of labour, crime risks, bureaucratic environment, market size and utilities, and interstate conflict.
- Assess your company’s exposure to country specific operational and business risks, using BMI’s insight on the current dangers of operating in the market.
- Evaluate Congo, Dem. Rep.’s risk profile against its regional peers, helping you understand the market’s strengths and weaknesses in relation to other countries.