Democratic Republic of Congo

Country Summary

Macroeconomic performance: Real GDP growth was an estimated 4.0% in 2018, up from 3.7% in 2017, due to higher commodity prices and greater mining production. The primary sector con- tinued to be the key driver of growth, sustained by a dynamic extraction sector. Because of budget pres- sures on the country’s own resources linked to elec- tions, the fiscal balance slipped to an estimated deficit of 0.6% of GDP, down from a surplus of 0.1% in 2017. Management of government debt remained controlled, at an estimated 18.2% of GDP at the end of 2017. In 2018, the Central Bank of the Congo lowered its key interest rate from 20% to 14% in view of more favorable developments in economic activity. Inflation was an estimated 27.7% in 2018, down from 41.5% in 2017. The current account deficit fell to 1.1% of GDP in 2018 from 3.6% in 2017, as a result of greater mining production.

Tailwinds and headwinds: Growth is projected to settle at 4.5% in 2019 and 4.6% in 2020. The primary sector, sustained by mining, should remain the key driver of growth. This outlook could be influenced positively by firm prices for the country’s commodities on the international market, successful elections in December 2018 (with results accepted by all stakeholders), progress in the security situation in the central and eastern parts of the coun- try, control over the Ebola virus epidemic, and a start to diversification in the fabric of production. Contraction in production from China, the country’s main trading part- ner, could also affect the pace of growth.
The economy lacks diversity, with growth depen- dent largely on the extraction sector, which in 2017 accounted for 99% of the value of exports, 34% of total government revenue, and 2 points in GDP growth. The productive base of the economy must therefore be diversified for sustained, sustainable, and resilient growth. To achieve this, several constraints need to be removed. The main one is the infrastructure deficit that limits the country’s performance in terms of trade integration. In fact, the country has the highest import and export transactional costs in Africa because of the poor quality of railways, ports, air transport, and energy supply. With a ranking of 184 out of 190 countries on the World Bank’s Doing Business 2019 report, greater efforts must be made to improve the business climate.
The main challenge to budget policy is the structural weakness of domestic revenue (an average of 9% of GDP over 2016–18, compared with the average of 17% for Sub-Saharan Africa). More reform aimed at increas- ing domestic revenue will have to be made.
The country could better use the opportunities pro- vided by the agriculture and wood sectors in its diver- sification efforts. The National Strategic Development Plan, now being finalized, aims for Democratic Republic of Congo to become a middle-income country by 2022 thanks to agricultural transformation. Establishing agri- business parks in various areas and ensuring that small producers’ interests are taken into account will help. Industrializing the wood sector would strengthen the efforts being made in the agricultural sector.
Finally, the energy sector must be further liberalized to receive more investment. This would reduce the pro- duction costs of businesses and increase the popula- tion’s access to energy.

Source: African Economic Outlook 2019

Fixed Income


The CEMAC securities yield curve extended to 5 years with 9 benchmark points along the curve (3m-6m-1-1.5-2-3-3.5-4 and 5 years). 

The issuance strategy is based solely on funding the budget. Constructing the yield curve is not taken into account in the issuance strategy. The issuance methods used are the auction method and the underwriting method.

Issuance strategy 

CEMAC states may issue new lines on the financial market in Libreville or in Douala. They can also use the auction market for government securities which is organized by the Central Bank, the Banque des Etats de l’Afrique Centrale (BEAC). The states have no proper debt strategy in place. 

Benchmark issues 

There are 9 benchmarks maturities for government securities in local currency in the CEMAC zone:  3m-6m-1-1.5-2-3-3.5-4 and 5 years. 

Yield curve 

Yield curve calculation models 

The BEAC prepared its own in-house method for computing its yield curve: the implied yield curve.

Interpolation methods 

The Brandt interpolation method is used in the CEMAC region. 

Yield curve managed by 

The BEAC is responsible for calculating the yield curve on a monthly basis. 

Challenges in building an efficient yield curve 

  • Illiquid and limited secondary market: buy-and-hold investors 
  • Narrow investor base: only banks are involved in the bond market 
  • Coexistence of three agencies for issuing bonds and bills: the Douala Stock Exchange (DSX) and the Bourse des Valeurs Mobilières de l’Afrique Centrale (BVMAC) are in charge of syndication. The Banque des Etats de l’Afrique Centrale (BEAC) is responsible for auctions.
  • Lack of issuance strategy in CEMAC states 
  • Lack of reliable data 
  • Lack of long-term maturity 
  • Two countries had never issued on the domestic market as of end-2015

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