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DRC is set to emerge as the fastest growing economy in Africa

6K views 31 replies 13 participants last post by  BUTEMBO21 
#1 ·
A Diamond In The Rough
The Democratic Republic of Congo (DRC) is set to emerge as the fastest growing economy in Africa, clocking growth rates of 8.7% and 8.5% in 2014 and 2015, respectively.

Globally, only Turkmenistan has higher global rates, according to The International Monetary Fund latest World Economic Outlook.

The IMF expects growth to accelerate in the DRC as massive investments in infrastructure and mining gets under way. The country saw foreign direct investment worth USD 3.3 billion flow into the country in 2012 - fourth in the Sub-Saharan Africa region, after Nigeria, South Africa and Mozambique.

DRC has been the second fastest-growing market in terms of new project investments, rising 47.6% annually between 2007 and 2011, second only to Ghana's 50.8% growth.

The robust growth rates come after a period when the economy contracted by 4.5% annually from 1991-2002. The country of 75 million people has been ravaged by civil wars, political and social instability.

After insurgencies and counter-insurgencies that lasted more than a decade, a U.N.-backed accord to stabilise the DRC was signed in February2013 by 11 African countries -- Angola, Burundi, Central African Republic, Congo, the Republic of Congo, Rwanda, South Africa, South Sudan, Uganda and Tanzania.

The accord has allowed President Joseph Kabila to pursue some economic reforms and start the slow process of building the economy.

"With the support of international emergency assistance and improved prices for key export commodities, the DRC's macroeconomic situation has stabilised and the economy has recovered significantly," the IMF noted.

MINING MAGNET

The country - the largest in Sub-Saharan Africa in terms of area -- is rich in mineral and natural resources. Apart from its unique biodiversity thanks to 11,000 plant species and more than a 1,000 varieties of mammals and birds, the country also has abundant reserves of oil and numerous minerals.

More than 25 international mining companies operate in the country, drawn by its mineral and metal riches. By some estimates the total value of the DRC's mineral reserves could equate to USD 24 trillion.

While data is hard to come by for the DRC, the U.S. Geological Survey notes that by 2011 DRC's share of the world's cobalt production was 53%; industrial diamond 34%; tantalum 13%; gem-quality diamond 7%; copper 3%; and tin 2%.

"There are vast gold deposits - said to be the richest undeveloped gold deposits in Africa -in the Kilomoto concessions of Orientale province and around Twangiza in South Kivu," ," KPMG said.

The government is pushing major mining companies such as Glencore Xtrata Plc., AngloGold and Randgold to increase royalties. Companies are resisting the move, especially as the country suffers from electricity shortages which often hurt the sector's productivity.

BLANK CANVAS

DRC has a long way to go before its fragile recovery can take hold and investors - beyond the extractive industry - start to pay attention.

The country is like a blank canvas - fully of uncharted opportunities, but also daunting due to lack of infrastructure. Only 2% of the national network is paved and only 11% of the country's rural road network is in an acceptable condition.

The rail network, once extensive, is barely operational, and only 10% of the population has access to electricity.

Overall, the institutional framework to attract investors is also lacking. The DRC is ranked 183rd in World Bank's 2014 Doing Business Survey of 189 countries. The country fell 34 places from its 2013 ranking and performed poorly in virtually every aspect of business process, according to the World Bank data.

Absence of a conducive environment for private initiatives, legal insecurity and relative quality of labor, the infrastructure gap (transport and energy) and inefficiency of logistic services result in major economic costs; and the weakness of public governance have all contributed to the malaise, the World Bank said.

"The main development challenge is to continue to lay the foundations for sustainable and inclusive growth, in partnership with the private sector," the AfDB said.

Trends over the past decade have revealed DRC's ability to achieve satisfactory results under adverse conditions.
 
#4 ·
Meme chanson ....rien de nouveaux. Aucun impact sur la vie contidien de nos compatriotes. Soki tomeki ko developer .......oh faute ya 32ans. De l'autre cote , bazo vimba...... ba compte etondi , ba imeubles etc....

Ils faudrait commencer par combattre la corruption est l'impunite ...... deux handicapes majeurs pr un development juste et equilibrer.

Mulopwe
 
#7 · (Edited)
Meme chanson ....rien de nouveaux. Aucun impact sur la vie contidien de nos compatriotes. Soki tomeki ko developer .......oh faute ya 32ans. De l'autre cote , bazo vimba...... ba compte etondi , ba imeubles etc....

Ils faudrait commencer par combattre la corruption est l'impunite ...... deux handicapes majeurs pr un development juste et equilibrer.

Mulopwe
It is normal since we are still at the beginning of the growth curve. Growth always starts to impact those on top and trickles down to the bottom as middle class expands. Same pattern happened in Congo during colonial times during Belgian colonial reconstruction from 1920's to 1950's or any rebuilding, developing country today. Let's keep in mind social policy of a government is separate from economic growth. Economic growth just measures economic activity growth from year 1 to year 2 and so on.

Setting up social programs help but the most effective way is to fight poverty is the expansion of the middle class, which in turn pulls the lower classes into the middle class and the country becomes more diamond-shaped rather than pyramid-shaped. Notice pyramid shape has a large lower class at the bottom and tiny rich class at top while diamond shape has a larger middle, thus middle class!

It is true that with the less corruption, the faster the development. So less corruption will fast track economic growth further in the same way, Top to bottom. So let's encourage positive growth numbers even if the majority of society does not see benefit yet. It is of no consequence that many countries wanting to work with DrCongo is partly based on those growth numbers Congo is putting up, even though it is not yet benefitting majority of population
 
#6 ·
The last 4 paragraphers demonstrate the current reality which DRC faces. All of us are firmly aware of DRC economical capabilities with the right leadership, we will get on the right path. Good to see more positive articles even though they don't really reflect the reality.
 
#9 ·
DRC should've been growing at least 10% every year! The country of its size and resources should be doing a lot better. Kanambe should also make sure DRC is in the top 60 easy to do business list. That will pretty much increase growth and investment. But i could only see the country changing at higher pace when Kanambe is out and someone like Katumbi is in.
 
#10 · (Edited)
You are absolutely correct! DrCongo should experience a lot faster economic growth than it is experiencing at the moment. The engine of growth now is too dependant on the mining sector. Gov must diversify quickly and get other sectors to become engines. Like World Bank said, DRCongo has many sectors that can fuel its growth
 
#12 ·
Reason we're growing at a snail pace is we have this village leadership that has no priority whatsoever. There are a few people that are smart, but very powerless due to the absolute power by the so called Supreme commander and his click of the likes of Mende and then K. Mwanke, Mugalo, Gen Kalume etc... Very sad how people like these get in power.


Anyways; Agroculture alone would give us double digits growths. but it will have to be supported by infrastrucctures (Rail, Interstate Highways), Electrcity, subsidies and easy of starting business with at max 2 days to open a business.


These will allow people to spend less on food, but spend more on other consumer goods.

It will also allow more investments into Tourism, retail, real estate, construction and light manufacturing.



As long as the growth is not labour intensive, we're doomed to poverty.
 
#13 ·
Agriculture alone will NEVER give you double digit economic growth in a span of a few years, I don't care what country you are referring to. You said it yourself that agriculture has to be supported by infrastructure in order to thrive. That infrastructure costs money, lots of money to build and it doesn't get built in 3-5 years. A country of the size of DRC and with the type of ecological environment (rain-forest and savanna) such as DRC presents tremendous challenges in building infrastructure. The construction of the barrage de katende is an example of that. Its construction is being slowed down because of the challenges to bring material to Kasai. Yes, you will say...so why doesn't the "useless government" (your favorite statement) just build a new railroad system to Kasai to transport the material. Well, guess what my friend, such an endeavor is HUGE and will take time and LOTS of money. This is kinda like the question of which came first? The egg or the chicken?

I am not making any excuses for for the current government but lots of us here make comments that are unbelievably unrealistic. You call an economy that grew at nearly 8% last year a snail pace economy? Do you realize that we were one of the three fastest growing economies in africa? You call a budget that went from barely a billion dollar to nearly 8 billion dollar a snail growing budget? Do the math and tell me what is the percentage growth of our national budget for the last few years. Now, is the pace of things sufficient to make up for the lost years? NOOOOOO, it is not sufficient. But it is definitely not what I would describe as a snail pace growth. I also would like to see things happen faster, a lot faster. The difference between us is that I look where we have come from and compare to where we are now. You, on the other hand, totally disregard where we have come from and want to see DRC at the level of South Africa (for example) overnight. That is just unrealistic, I don't care even if it was a different president than JKK running the country.
 
#15 ·
Boma is smaller than Matadi....But Banana (a Deep Sea port on the Atlantic directly would be the largest and IMO, that zone should be a fREE tRADE/SPECIAL ECONOMIC ZONE/ENTITY LIKE hONG-kONG. AND WHAT IS GREAT ABOUT THAT oCEAN COAST IS THAT THERE IS ALREADY oIL FLOWING THERE, iNGA dAMS ARE JUST 160 KM AWAY, cEMENT FACTORIES ETC....AND IT'S drc'S WINDOW AND DOOR TO THE OUTSIDE WORLD DIRECTLY...SO YOU CAN IMAGINE THE SIZE OF THE POTENTIAL THAT AREA IS...IT'S MASSIVE
 
#18 ·
I agree, actually all the big countries in Southern Africa have huge potential. Almost all have reasonably small populations compared to Asian countries. This means urbanization, and infrastructure development will lift people out of poverty faster.

To Butembo21: What is the land policy in DRC? Is land under Chiefs or is it privately owned as freehold?
 
#22 ·
The Gov has realized its mistake of underinvestment in Ag sector and now is playing catch-up. They have held an Ag investment plan meeting promising to invest $6 billions from 2013-2020.

It's not a coincindence that the Mining sector is leading the growth in Congo right now. The mining sector received more than $10 billion investment in the last 10 years.

It is now the turn of the Ag sector to attract investments

http://lavoixdupaysancongolais.com/2013/11/12/business-meeting-secteur-agricole-en-rdc/
 
#23 ·
They might have realized mistakes of neglecting this vital industry....

But I still don't see anything concrete or serious . All they do is talks.

Also waiting for foreign investors is the worst thing to do instead of supporting Congolese farmers. Real agriculture development is to support and protect your farmers.

Very disappointing.
 
#24 · (Edited)
Katanga , Kasai, NK consume lots of Corn....Katanga alone should have been producing 15 million tones of Corn....NK 5 million Tones and the Kasais 20 million tones per annum.

Beans and Potatoes are heavily consumesd in NK, the governor there should heavily invest and subsudize and modernize this domain etc...
The CG needs to make it a priority of priorities by encouraging each province heavily invest in specialized in food crops that is heavily consumed in each provinces.....Stuff like Veggies and fruits must be in every province


Agroculture Credit Banks and Seeds/agro research centers needs to be created as well. where people should get loans/credit for their farming business , get trained, get info on advanced and efficient farming technics and of course infrastructures and electriocity as well as subsidies ...a successful agroculture deepnd on these things....


This thing about someone having 2-5 hetcraes must be pput to na end....Small farmers between 25-50 Hectares/farmer.....Medium farms between 100--250 hetcares/farmer and large between 500-1000 hectares.....IMO, no single farmer should own more than 1000 Hectares and should depend on the sort of farming he/she is doing.
 
#25 ·
This is an industry that would employ 10s of Millions directly and indirectly, provide formal jobs, good income etc, reduce inflanyion, poverty will be out faster and consumer power will increase for other businesses around the country and the impact of the economic growth will be felt by everyone in he country....an industry that would make the country grow uindouble digits and would attract lots of food processing, light manufacturiing investors.
 
#26 · (Edited)
Agriculture is wide range sector. The gov Ag investment plan mixes small farmer farming and big business farming combined with Research & development as well as financing.

NOwadays most of the agricultural planning is done at the provincial level anyways. Central gov is just backing up provincial plans.

Let's wish the Ag. investment plan well! If it works it will become one of the main drivers of economic growth as well as poverty reducer
 
#27 ·
You are right!

What bothers me is the facts that small farmers get taxed....this is a big no no no. should never happen. they should be ZERO tax on farmers.


Also, the CG needs to get serious by leaving the provinces with their 40% revenues which will allow the provinces to get enough revenues to invest in the industry.

Im talking about creating agro builtural developments where farmers should get loans/credit.
 
#30 · (Edited)
We have that major in High schools and Universities/colleges already (Its called Commercial, focused on Business/company management, finance/accounting).....but it needs to be updated/reformed , especially adding the particular Open business class.


Banks and even the governments need to provide loans/credit to people that want to open businesses.

You can have all those who studied how to open, operate and manage a business as well as 3 days or even 5 hours to open a businesses but where will many of them get resources to open one? and if that's done, how will the business grow if there are no infrastructures (logistics and Energy).
 
#31 · (Edited)
We need this to develop faster! Temps-Moyens-Activités-Résultats-Qualité (TMARQ)

RD Congo / Province : Le vice-gouverneur du Kasaï Oriental propose un mode de gestion axé sur les résultats




Mbujimayi, 19/05(ACP).-[/B]



Mbujimayi, 19/05(ACP).

- Le vice-gouverneur de la province du Kasaï Oriental Bruno Kazadi Bukasa a présidé, au cours du weekend sur le campus de Tshikama, une conférence-débat à l’intention des étudiants de la Faculté des lettres de l’Université de Mbuji-Mayi, a constaté l’ACP sur place.

L’intervention de M. Bruno Bukasa portait essentiellement sur une étude basée sur l’importance de la gestion axée sur les résultats (GAR), associé au système « Temps-Moyens-Activités-Résultats-Qualité » (TMARQ, dans les programmes de développement en République démocratique du Congo. Pour l’orateur, les deux systèmes mettent un accent particulier sur les avantages des systèmes qui favoriseraient la bonne atteinte des objectifs du millénaire pour le développement. Il a par ailleurs annoncé la publication imminente d’un ouvrage sur le système TMARQ et le développement au Kasaï Oriental.

ACP/NGZ/Ndom/Wet (19/05/2014 11 :39)
 
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