DEmoCRAtIC REpublIC oF CoNgo: opportunit­ies Expand as Reforms take Shape

- By Editor in Chief, Forbes African Renaissanc­e Paul Trustfull

Paul Trustfull, Forbes African Renaissanc­e, recently met with Democratic Republic of Congo President Felix Tshisekedi and Minister of Finance Sele Yalaghuli to discuss new developmen­ts and reforms in the country.

As the largest, and perhaps most exciting country to follow in Africa, the Democratic Republic of Congo (DRC) offers significan­t opportunit­y for investors. The DRC’s story starts with mineral wealth, yet there are some surprising new chapters being written under President Tshisekedi’s leadership.

The central African nation is endowed with over $24 trillion worth of mineral riches, including copper, diamonds and coltan. Its natural resources supply the consumer electronic­s market, and fuel the proliferat­ion of renewable energy and many technology innovation­s.

The DRC shows remarkable resilience in the face of global economic uncertaint­y.

The nation of approximat­ely 80 million is now on the cusp of economic prosperity. The DRC holds tremendous potential in the context of untapped mineral deposits, human capital, manufactur­ing capabiliti­es and agricultur­e. Today, it stands as a beacon of perseverin­g success—one that serves as a model for other central African nations.

Fresh Leadership Accelerate­s Growth

President Felix Tshisekedi and Minister of Finance Sele Yalaghuli are leading efforts to continue growing and diversifyi­ng the economy. At the same time, they are working to further strengthen multinatio­nal relationsh­ips and introduce capital investment opportunit­ies. Over the past several months, Tshisekedi’s leadership team has successful­ly started developing innovative mechanisms to propel the country towards accelerate­d growth.

Within the bustling capital city of Kinshasa, evidence of this growth is widely apparent. From the improved road infrastruc­ture to the influx of constructi­on cranes crowding the nation’s skyline, the stage is being set for a new wave of economic expansion.

Despite global uncertaint­y, the country’s vibrant economy has shown signs of structural integrity that are a testament to its leadership and values. While GDP

growth slightly declined to 4.4% in 2019 compared to 5.8% in 2018, year-on-year inflation decreased to 4.6% in 2019 from 7.1% in 2018. While global commodity and macroecono­mic shocks affected the country’s substantia­l extractive­s sector, economic stability has prevailed and opportunit­ies for growth are abundant.

Since October 2019, Tshisekedi and his administra­tion have establishe­d more than 80 reforms to attract foreign capital to the DRC. Improving the business climate and its ability to attract investors is among his administra­tion’s most important objectives.

“My government and I are resolutely committed to mobilizing all necessary efforts to further clean up the business climate and provide a framework for private investment,” says Tshisekedi.

Reforms Designed to Attract and Streamline Investment

Investment opportunit­ies have grown exponentia­lly as recent government reforms have helped global institutio­ns see significan­t growth potential in the DRC. Today, investors can take advantage of the nation’s mineral wealth, agricultur­al opportunit­ies and a growing middle class, in addition to a decrease in bureaucrac­y and reforms in government regulation.

Since taking office in January 2019 after being elected in the country’s first-ever peaceful transfer of power, Tshisekedi’s actions and commitment­s illustrate the desire of his new government to make the DRC an attractive destinatio­n for foreign capital. His active pursuit of change in the fundamenta­l foundation­s of the country is immense and his work to date has shown his ability to take action.

“The country is firmly committed to a series of reforms to improve the business climate,” says Tshisekedi. “Improving the business climate and the economic attractive­ness of the DRC are among the most important objectives of my administra­tion.” Tshisekedi has addressed inherited issues of corruption and property rights head-on. He acknowledg­es that the DRC can only be more attractive to foreign capital if it can drasticall­y reform these problems. By reducing corruption and strengthen­ing property rights, he is creating a system that will be able to generate the right incentives to attract and retain investors.

Beyond developing internal controls to better empower the private sector, President Tshisekedi is reviewing the country’s tax and customs policies. Ultimately, reforms aim toward a more favorable tax system for the private sector. In addition to the bolstering the national Investment Code, which offers substantia­l tax benefits, the DRC is actively looking into establishi­ng Special Economic Zones that offer even greater benefits.

Structural Changes Address Education, Healthcare and Poverty

As one of central Africa’s anchors of commerce and developmen­t, the DRC has been often mischaract­erized as a nation

Investors in the DRC can take advantage of the nation’s mineral wealth, agricultur­al opportunit­ies and a growing middle class, in addition to a decrease in bureaucrac­y and reforms in government regulation.

struggling to overcome its perpetual conflicts as it attempts to reach its potential. The Tshisekedi administra­tion recognizes the historical challenges it must address. Among these are weaker and non-inclusive growth, advanced dilapidate­d infrastruc­ture and weak governance. The nation’s new leader s hip team has already shown a great willingnes­s to introduce structural reforms to create a more stable economic environmen­t. “The main lever to combat poverty is to sustainabl­y and substantia­lly increase national wealth while ensuring its best redistribu­tion ,” Tshisekedi notes.

His administra­tion has taken action by prioritizi­ng education and healthcare for its inhabitant­s. First steps include making basic education free throughout the country, and rehabilita­ting a number of healthcare centers. These initiative­s are focused on reducing the financial burden on the poorest Congolese and thus allowing an opportunit­y to enhance social equity.

Diversifyi­ng Economic Opportunit­ies

With an eye on expanding the nation’s economy beyond its natural resources, Tshisekedi is looking to em power entreprene­urs and small business owners. With diversific­ation into sectors in which smaller businesses can thrive, the nation can boost its economic performanc­e and decrease dependence on commoditiz­ed goods.

The president also plans to achieve economic diversific­ation through agricultur­al developmen­t and industrial­ization. Tshisekedi and his team are implementi­ng several coordinate­d initiative­s to strengthen incentives for investors in areas other than the extractive sector.

Developing core infrastruc­ture throughout the country is also a top priority. Tshisekedi is strongly committed to rapidly reducing the significan­t gap in basic infrastruc­ture in the transport and energy sec tor. To ameliorate some of the near-term concerns, his administra­tion has started a program to rehabilita­te urban roads in order to ease transport and decrease congestion. While transport infrastruc­ture remains a challenge, perhaps the biggest challenge throughout the country and region remains power generation and distributi­on. Tshisekedi is determined to revamp the DRC’s energy sector by taking advantage of the nation’ s immense hydropower capabiliti­es.

The developmen­t of the Inga Dam Project, one of the largest infrastruc­ture projects ever undertaken, remains a key priority of the president’ s administra­tion. He sees the Grand Inga Dam, the centerpiec­e of the Inga Dams, as potentiall­y the world’s largest hydropower project and an instrument­al part of Africa’s future energy strategy. The dam has the potential to generate 38,000 MW of energy and will help power South Africa, Botswana and Angola.

For longerterm electric infrastruc­ture need s, disc u ssions with private sec tor participan­ts are underway to develop smaller micro-dams that can supply power in several different parts of the country.

Equipped with Financial Expertise

The DRC’s Minister of Finance Se le Ya laghul ii st asked with a tremendous­ly difficult challenge: growing and maintainin­g the economy of an immense and diverse country. In a world of collapsing commodity prices, uncertain demand and general malaise within the global banking sector, this task may seem daunting at times. Hailing from Gamena, a town in northern DRC, Minister Yalaghuli is no stranger to these types of challenges. Commodity price fluctuatio­ns and economic ramificati­ons are not new to the country,

and over time, it has developed the capability to shield itself to some degree. As the former director general of the General Directorat­e of Taxes, Yalaghuli is experience­d at improving the mobilizato­n of revenues and contributi­ng to the restoraton of the balance of public finances. President Tshisekedi and Minister Yalaghuli work in partnershi­p to implement prudent fiscal and monetary policies and develop frameworks for the nation’s future. In 2019, further advances to the nation’s stability were made as the DRC agreed to a Reference Program with the Internaton­al Monetary Fund. The three-year program demonstrat­es the leadership’s willingnes­s to implement courageous reforms necessary to improve the country’s macroecono­mic environmen­t. Through the program, the IMF loaned $370 million to the DRC government to help restore macroecono­mic and financial stability, and improve governance and transparen­cy. Minister Yalaghuli’s prior experience working with internatio­nal agencies has proved invaluable in the current setting. He was instrument­al in negotatng cooperaton agreements with major internatio­nal institutio­ns including the Internatio­nal Monetary Fund, the World Bank Group and the African Developmen­t Bank.

A Country of Opportunit­ies and Immense Potential

Through developmen­t of infrastruc­ture and the improvemen­t of its overall business climate, the leadership of the Democratic Republic of Congo has proven its ability to accomplish goals necessary to bring progress and contnued economic growth. “I remain convinced that the transforma­ton of our natural potental into effectve wealth for the benefit of our people requires a strong and innovatve private sector,” says Tshisekedi. As the Democratic Republic of Congo contnues to develop and create a wealth of opportunit­y for internaton­al investors and its citzens, the developmen­t of a businessfr­iendly environmen­t is vital for the country to become a superpower within the African contnent.

 ??  ?? Democratic Republic of Congo President Félix Tshisekedi
Democratic Republic of Congo President Félix Tshisekedi
 ??  ?? DRC Minister of Finance Sele Yalaghuli with African Developmen­t Bank President Akinwumi Adesina
DRC Minister of Finance Sele Yalaghuli with African Developmen­t Bank President Akinwumi Adesina
 ??  ?? President Félix Tshisekedi and President of France Emmanuel Macron
President Félix Tshisekedi and President of France Emmanuel Macron
 ??  ?? President Félix Tshisekedi and Pope Francis
President Félix Tshisekedi and Pope Francis
 ??  ?? President Félix Tshisekedi and Secretary-General of the United Nations António Guterres
President Félix Tshisekedi and Secretary-General of the United Nations António Guterres
 ??  ?? DRC Landscape
DRC Landscape
 ??  ?? President Félix Tshisekedi and African Renaissanc­e Editor in Chief Paul Trustfull
President Félix Tshisekedi and African Renaissanc­e Editor in Chief Paul Trustfull

Newspapers in English

Newspapers from United States