The Central African Republic (CAR) is a landlocked country in central Africa, with a population of 4.5 million. The country’s history has been marked by political instability. In 2013, a major security and humanitarian crisis ravaged the country.
In December 2012, a coalition known as Séléka (“alliance” in the Sango language), composed of five different armed movements, launched an insurrection against the Government of President François Bozizé, which culminated in a coup d’état in March 2013 (despite the signature of a peace agreement in January 2013 in Libreville, Gabon).
The ousted Bozizé was exiled, and Michel Djotodia, the leader of the rebel forces, assumed power, becoming the first Muslim Head of State of a majority Christian country. Clashes, stemming from sectarian violence between supporters of the defeated president and the forces of the new regime, plunged the country into chaos.
The toll taken by the crisis, which rocked the country in 2013, was heavy: over 1,000 people were killed, and close to one million people fled their homes, with refugees currently representing nearly one quarter of the population. According to the United Nations, 2.2 million people are currently in desperate need of humanitarian aid.
On January 9, 2014, a special summit of the Economic Community of Central African States (ECCAS), convened by Idriss Déby, the president of Chad, aimed to find solutions to the crisis. Accused of passivity in the face of the crisis, Michel Djotodia stepped down. On January 20, Catherine Samba-Panza, the mayor of Bangui, capital of the Central African Republic, was elected interim president by the National Transitional Council (NTC). Her mission is to bring peace to the country, revive a completely paralyzed administration, and facilitate the return of hundreds of thousands of displaced people to their homes. Based on the transition timetable, general elections (legislative and presidential) should be held by the first half of 2015 at the latest.
Economic and Social Context
Even before the onset of the political and security crisis that devastated the country’s economy, the poverty rate in the Central African Republic (62 percent) was one of the highest in the world. Social indicators place CAR among the least developed countries in the world. Thus, the “2013 Human Development Report” of the United Nations Development Program (UNDP)—which classifies countries based on their human development index (HDI)—ranks CAR 180th out of 187 countries. In 2007, the country prepared a Poverty Reduction Strategy Paper (PRSP-1). Yet, life expectancy (48 years) remains among the lowest in the world, and infant and maternal mortality rates have deteriorated over time.
Although the country possesses abundant natural resources, they are under-exploited. Its main exports are wood and diamonds, and subsistence agriculture accounts for almost one third of GDP.
In 2014, the country’s economic outlook is uncertain given the profound impact of the 2013 crisis on the Central African economy: -19.8 percent GDP growth based on October 2013 projections. In 2012, growth (4.1 percent) showed an increase over 2011 (3.3 percent), based on World Bank and IMF estimates (in their November 2013 mission reports). The economy remains fragile owing to successive crises, and the resources generated by CAR are inadequate for its development. State tax revenue represents less than 10 percent of GDP and is unable to finance basic public services. As a result, over 80 percent of public investment is externally financed.
In June 2012, the Central African Republic signed an Extended Credit Facility (ECF) with the IMF. In June 2009, the Central African Republic had reached the completion point under the Heavily Indebted Poor Countries (HIPC) initiative, and total debt stood at less than 30 percent of GDP in 2012.
Last Updated: Jan 23, 2014