Congo’s Record Copper Production to Spur 2014 Growth, IMF SaysMichael J. Kavanagh
Economic growth in the Democratic Republic of Congo may accelerate to 8.7 percent, spurred by record copper production, the International Monetary Fund said.
Congo produced more than 900,000 metric tons of the metal in 2013 after exporting 620,000 tons in 2012, the Washington-based lender said today in an e-mailed statement. The economy grew 8.5 percent last year, with inflation slowing to 1.1 percent, a record low for the country, it said.
“The short-term economic outlook continues to be promising with low inflation and GDP growth projected at 8.7 percent for 2014 driven by continued buoyant mining sector activity,” IMF officials said after a 15-day visit to the central African country.
Companies including Freeport-McMoRan Copper & Gold Inc. and Glencore Xstrata Plc lead a mining industry that contributed more than 15 percent of Congo’s gross domestic product in 2012, according to the IMF.
The country’s reliance on mining indicates the government should maintain a flexible exchange rate and increase its cash reserves to protect the country from a drop in commodity prices, the IMF said. Congo’s current reserves are sufficient to cover nine weeks of non-aid related imports, it said.
The IMF also urged the government to recapitalize the central bank and ensure its independence, while asking for more information about the implementation of a $6.2 billion minerals-for-infrastructure deal between Congo and China. The lack of data prevented IMF officials from performing “a comprehensive debt sustainability analysis,” it said.