Overview

  • The Central African Republic (CAR) is a landlocked country embarking on a long path to recovery. In 2013, a security crisis unraveled its social fabric. Elections in 2016 brought hope for a gradual end to transition and turmoil. The CAR has a population of about 4.6 million (2016).

    Political Context

    For the first time in its history, CAR has a democratically-elected president and parliament. In March 2016, Faustin Touadera was declared president after a run-off with his main rival, Anicet Dologuele. Legislative elections placed Abdoul Meckassoua, from the Muslim minority, at the head of the National Assembly. The elections concluded the two-year mandate of Catherine Samba-Panza’s transitional government.

    CAR’s crisis began when President François Bozizé was overthrown in March 2013 by the Séléka rebel movement. Less than a year later, Séléka leader Michel Djotodia was forced to step aside after conflict between the mainly Muslim Séléka and Christian Anti-Balaka. A ceasefire in July 2014, and the Bangui Forum in May 2015, marked an end to all-out conflict, although sectarian tensions have continued to erupt since. 

    The French Sangaris force and the United Nations played major roles in restoring peace. France’s military mission ended in October 2016 but the UN Security Council extended the mandate of its MINUSCA force until November 2018, authorizing a force of 11,650 personnel, including military observers and staff officers, police and corrections officers. Its aim is more capacity to protect civilians.

    Social Context

    Internal displacement in the CAR rose in 2017, the UN reports: by early 2018, about 688,000 Central Africans were internally displaced and 546,000 were refugees in neighboring countries. Clashes in December 2017 displaced about 78,000 people from Ouham-Pendé Prefecture’s Paoua town. At least 2.5 million people will need assistance in 2018, more than half the country’s population. The government and Country Team launched a $515.6 million (CFAF 275.7 billion) Humanitarian Response Plan in 2018.

    Economic Overview

    Economic recovery in CAR continued in 2017 with 4.3% real GDP growth rate, slightly slower than 2016 (4.5%), but better than the forecast made at the beginning of the second half of 2017 (3.8%). Private consumption contributed the most, along with a slight contribution from government. Export growth decelerated to 5.2% in 2017, after picking up at 8.2% of GDP in 2016 on the back of key exports, such as timber, gold, coffee, and cotton. Imports, including food, increased as security along the Bangui–Garoua Boulai corridor improved.

    On the supply side, industrial sector growth rose from 2% in 2016 to 7.2% in 2017 (led by construction, agri-industry, and green diamonds), while the service sector struggled amid volatile security. The primary sector dropped from almost 6% in 2016 to about 3% in 2017.

    Inflation fell from 4.6% in 2016 to 4.1% in 2017. The current account deficit reached 8.5% in 2017, down from 9.0% in 2016, reflecting a deceleration in food aid and slightly stronger forestry, diamonds, and gold exports. Public debt, 56.2% of GDP in 2016, is projected to fall to 51.8% of GDP in 2017, driven by the clearance of domestic arrears. However, the CAR remains at high risk of debt distress.

    The government continued its fiscal consolidation and took action to meet its revenue target for the end of 2017. The domestic primary fiscal balance improved—from a deficit of 3.0% of GDP in 2015 to 1.1% in 2016—which led to an overall fiscal surplus (including grants) of 1.6% of GDP. The balance is estimated to be 1.9% of GDP in 2017, translating to a budget surplus of 0.5% of GDP.

    Poverty remains pervasive and elevated: the last household survey was in 2008, making it difficult to monitor recent trends. But projections based on GDP per capita indicate that in 2017 about 75% of the population lived below the international poverty line (US$1.90 per day, 2011 PPP)—up from 66% in 2008. And, as per the 2016 Human Development Index, CAR had the world’s lowest level of human development, ranking 188th out of 188 countries.

    Protracted insecurity has left its mark. An escalation of conflict in 2017 triggered new waves of forced displacement not seen since 2014. Livelihoods of the poor are mostly in agriculture, and instability prevents farmers from tending their fields, undermines food security, and hinders the recovery of the agricultural sector.

    Medium Term Outlook

    The CAR’s positive macroeconomic and poverty outlook strongly hinges on stability, as well as on investment and export growth. A worsening security situation will impact growth, due to stabilize at about 4.0% over the medium-term—contingent on the implementation of the government’s investment plan. Poverty is expected to drop to 73% by 2019. Exports of diamond and wood could pick up, while cotton production and cotton exports may increase because the sector cleared its arrears in 2017. Imports of equipment are due to stay high as public and private investment resumes.

    Fiscal consolidation will continue over the medium-term, with an average fiscal surplus of 0.7% for 2018–2020. While total expenditure will quicken as the CAR administration deploys beyond Bangui, total revenue is expected to return to its pre-crisis level of 9% of GDP.

    Inflation is expected to fall to 3.6% in 2018, reaching the Central African Economic and Monetary Community convergence level of 3% by 2020. Strengthening debt management will reduce the debt burden, with total government debt declining to 39.6% of GDP in 2020. The current account balance is forecast to improve from a 8.4% deficit in 2018 to 6.7% in 2020.

     

    Last Updated: May 16, 2018

  • World Bank Group Engagement in the Central African Republic

    In 2015, the World Bank provided $10 million for FY16–17additional financing to the Emergency Public Services Response project, $12 million to the Health Sector Support project, and $20 million to the countrywide, labor-intensive public works “Londo” project. A series of policy notes have since informed a $250 million Turn-Around program of short-term stabilization efforts and long-term development activities. These include:

    1. a financial reform project; development objectives and associated Technical Assistance; and a project to consolidate state capacity and improve resource allocation;
    2. support for the reintegration of former combatants and for displaced populations; and
    3. financing to improve service delivery in the water, energy, and social sectors, and in ICT. Support to the agricultural, mining, and forestry sectors, and for access to major basins of production, will create much-needed jobs.

    The World Bank co-led a Recovery and Peacebuilding Assessment and played a key role in an international donor conference for CAR in November 2016 that resulted in a $2.2 billion pledge, including $2 billion for reconstruction and $0.2 billion for humanitarian assistance. This exceeded the $1.6 billion expected for the next 3 years, with the bulk of financing coming from IFIs such as the WB, AfDB, Arab funds, IMF, and the European Union (EU)—both EDF and European countries, among which France stood out. 

    Last Updated: May 16, 2018

  • The LONDO project (or ‘Stand-Up’ in Sango, the official language in CAR)

    LONDO is a peacebuilding project that uses labor-intensive public works to promote social cohesion, economic recovery, and local governance. The first four phases of it have been completed; it is 75% executed and 70% disbursed. The government has asked for $25 million in additional financing (for delivery in early 2019) to support the return of state and public services in the provinces. As the largest cash-for-work program in CAR, it has almost a million man-days in 54 out of 71 districts. Through it, some 26,000 beneficiaries (35% of them women) have maintained 1,500 km of rural road to help their communities. The project benefits from collaboration with international and national partners working in the humanitarian-development-peace nexus.

    Emergency Public Services Response project

    The Emergency Public Services Response Project is to re-establish a government payroll and operational financial management systems. It supports the government to pay civil service salaries in civilian sectors (excluding the security forces and police). The project has helped over 17,000 civil servants, reducing the time between planned and actual pay days from 30 hours to 13 (the target is 10.) The percentage of customs staff who resumed work increased from 10% to 86% in 2015 alone. The percentage of teachers and health workers resuming work in districts where security has improved has increased from 0% to 89%.

    Emergency Power Response Project

    The Emergency Power Response Project is working to partially restore a reliable electricity supply to customers in Bangui, including the national water company and hospitals. The project is rehabilitating the Boali 1 and 2 hydropower facilities. Load shedding has stopped for essential services; 150 km of distribution lines have been constructed or rehabilitated; and annual electricity losses have been reduced by 9%.

    Health System Support Project

    The Health System Support Project aims to increase the use and improve the quality of maternal and child health services in targeted rural areas. It has supported over 3.2 million people, half of them women, and treated 3,391 female victims of violence. More than one million women have been given access to a basic health, nutrition, or reproductive health package.

    The Emergency Urban Infrastructure Rehabilitation and Maintenance Project

    The Emergency Urban Infrastructure Rehabilitation and Maintenance Project (closed in September 2016) increased access to infrastructure and urban services for the most deprived districts of Bangui. Close to 85,000 people benefited from improved drainage, and over 37,000 from access to improved water sources.

    Last Updated: May 16, 2018

  • In a climate of instability, one where significant security risks remain, the World Bank Group is working closely with the United Nations peacekeeping mission MINUSCA (the UN’s Multidimensional Integrated Stabilization Mission), African Union, EU, France, and the United States. Collaboration has entailed assessments with the UN, United Kingdom’s DFID, and France’s Agence française de développement, in consultation with the CAR. The preparation of projects is coordinated with development partners.

    Last Updated: May 16, 2018

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LENDING

Central African Republic: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments


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Additional Resources

Country Office Contacts

Main Office Contact
Banque Mondiale
Rue des Missions
Bangui, Central African Republic
+236 21 61 61 68
For general information and inquiries
Edmond Badge Dingamhoudou
Communications Officer
N'Djamena, Chad
+235 6612 7334
edingamhoudou@worldbank.org
For project-related issues and complaints
caralert@worldbank.org