Central African Republic Plans Emergency Economic Revival

The Central African Republic is preparing an emergency program to deal with the effects of a coup four months ago that has left the government without funds, Finance Minister Christophe Mbremaidou said.

A 261 billion-CFA-franc ($525 million) budget approved in December is no longer in effect because individuals and companies have stopped paying taxes, Mbremaidou said in an interview in the capital, Bangui. The government plans to approach donors to help deal with “urgent problems” including a lack of access to health care and education, he said.

“The coffers are empty,” Mbremaidou said on July 20. “With the recent crisis, companies and institutions that facilitate the movement of money into state coffers through the payment of taxes are closed and no longer work.”

Central African Republic has descended into a “state of anarchy and total disregard for international law” since former President Francois Bozize’s government was deposed by rebel Seleka forces on March 24, according to the United Nations Security Council. The economic outlook is “highly uncertain” after the fall of Bozize’s regime, the African Development Bank said on its website.

Growth in Central African Republic last year was 3.1 percent, lower than forecast, and the outlook for 2013 and 2014 has deteriorated, the bank said in May. Mbremaidou didn’t provide an estimate for this year.

Refugees, Displaced

To revive the economy, the government plans to improve security to encourage people to return to work, Mbremaidou said. The state is also urging those displaced by the recent conflict, including employees of aid agencies, to return to the country, he said.

“Most organizations that support us have left the country and many of the people who manage projects also left,” Mbremaidou said. “These activities are important for the development of the country.”

The nation’s entire population of 4.6 million people has been affected by the political crisis, with 1.6 million people in need of humanitarian aid, United Nations humanitarian chief Valerie Amos said on July 12.

“Security is a major concern and the UN is working hard to reestablish its presence and programs in different parts of the country,” she said. The UN children’s agency, UNICEF, flew a plane carrying 52 metric tons of emergency supplies to Bangui today, its third shipment since March, the agency said in an e-mailed statement.

Central African Republic’s emergency program will be presented to “external partners” at a round-table to be held at an unspecified date in the future, Mbremaidou said.

Aid Freeze

President Michel Djotodia this month appealed to the African Union to lift its suspension of his country from the continental body to enable aid flows to return. The nation needs foreign aid to prevent the threat of famine, he said. In June, the European Union doubled its humanitarian aid to 37 million euros ($49 million).

Last week, the African Union approved a 3,600-strong peacekeeping force to help stabilize the country. An additional 1,600 soldiers are needed to bring the force to full strength, Peace and Security Commissioner Ramtane Lamamra said.

Central African Republic has been plagued by violence since independence from France in 1960, with at least five battles for the capital, Bangui, taking place from 1996 to 2003.

Seleka Rebellion

Seleka began its rebellion after accusing Bozize of failing to honor a 2008 peace accord. An agreement signed in Libreville in January ended the fighting and created a unity government. The insurgents resumed combat in March, saying Bozize had failed to meet a new set of demands.

Central African Republic has a gross domestic product of about $3.6 billion and earns most of its foreign currency from timber and diamond exports, according to the CIA World Factbook.

Pangea Diamondfields Inc., an Isle of Man-based exploration company, owns a concession that is currently on care and maintenance, according to its website. Standard Bank Group Ltd., Africa’s biggest lender, earlier this year ended talks with Axmin Inc., a Canadian gold explorer, over a $100 million loan to help finance a gold mine there.

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