Magazine article African Business

Congo's Government Will Need Post-Election Emergency Budget, IMF Warns

Magazine article African Business

Congo's Government Will Need Post-Election Emergency Budget, IMF Warns

Article excerpt

THE INTERNATIONAL MONETARY FUND's (IMF) chief economist in Brazzaville, Tchicaya Gondet, warns that one of the first acts of re-elected Republic of the Congo President Denis Sassou Nguesso (above, sunglasses) will be to table an emergency budget.

"A supplementary budget will have to be submitted in the coming months," says Gondet. Nguesso's government had to table two supplementary budgets in 2015 as slumping oil prices bit into its revenue forecasts, and has had to resort to loans from China and short-term advances from its central bank to shore up its short-term finances. Treasury officials have indicated that the supplementary budget would be based on an oil price of $30 per barrel for the remainder of 2016, compared to an original projection of $40 per barrel when the budget was passed last December.

The fourth-largest oil producer in sub-Saharan Africa, the Republic of the Congo is under increasing financial pressure as a result of the oil price slump. Over 70% of the Congolese GDP came from oil in 2015, and close to 80% of government revenue.

The budget will also include cuts to public spending and plans to increase revenue collection from customs payments.

Sassou Nguesso, who has ruled Congo for 32 of the last 37 years, was re-elected for a third consecutive term in the first round of elections, despite international criticism about the conduct of the election.

Opposition candidates claim that the poll was marked by a number of irregularities, including vote buying, lack of media access and intimidation of their campaigns. …

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