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In the Democratic Republic of Congo (DRC), after a three-week marathon of negotiations, governments and the International Monetary Fund (IMF) agreed on the content of a three-year program. The announcement was made on Friday 28 May.
Yes The agreement validated by the IMF Board, the DRC could start receiving an initial payment, from mid-July, of approximately $ 1.5 billion that could be disbursed under this program. But in return, the Congolese state undertakes many commitments.
Renew the Board of the Central Bank
At present, all the conditions for obtaining the final IMF agreement have not yet been met. The Congolese government must fulfill its commitment to transparency in the management of covid-19 funds, in particular by publishing the contracts which justify its ongoing expenditure. It must also modify and renew the central bank’s board.
“The commitment has been made firmly. Compliance with the 2018 Central Bank Act will apply before the DRC file is submitted to the IMF’s Board, says Nicolas Kazadi, Minister of Finance.
Once the program has been adopted in mid-July, other reforms must be initiated by the Congolese government with a precise timetable that will then allow IMF support to be paid in installments.
“Better business climate”
“The most important reforms,” says Nicolas Kazadi, “are related to taxation and are simply focused on simplification in order to increase revenue mobilization and, above all, in a better business climate. Cooperation with the IMF is welcome for our government. It is important to send a signal confirming our desire to bring the Democratic Republic of Congo back to good economic and financial practice, “the finance minister added before promising that” the details of the commitments made by the Congolese state will be known soon. “.
Among the expected reforms is the reintroduction of VAT (VAT).
To read also: Nicolas Kazadi, DRC’s Minister of Finance: “a program with the IMF is necessary”
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