DR Congo Economic Outlook
Revised estimates from the IMF and the Central Bank show economic growth reached 8.9% in 2022 (2021: +6.2%). The acceleration was driven by a 22.6% expansion in the mining sector—the production of cobalt and copper increased by 19.5% and 30.9% year on year, respectively—and higher public spending. In Q1 2023, economic growth should have decelerated somewhat: In January–March, both inflation and interest rates reached their highest levels in nearly two years, boding poorly for consumption and investment. On 15 May, the government suspended import taxes on maize amid growing food shortages in the country’s south. Meanwhile, the President reshuffled his cabinet to include a number of political allies he feels he will need for the upcoming general election in December. However, the inclusion of a number of figures tainted by corruption bodes poorly for governance standards.
DR Congo Inflation
Inflation rose to 17.0% in March (February: 16.8%). Meanwhile, the Central Bank raised its policy rate by 75 basis points to 9.00% on 22 March due to upside inflation risks. In 2023, our panelists expect inflation to accelerate from 2022 due to a combination of strong domestic demand and elevated food prices. Potential fiscal stimulus in an election year is an upside risk.