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Overview

With a surface area equivalent to that of Western Europe, the Democratic Republic of Congo (DRC) is the largest country in Sub-Saharan Africa (SSA). DRC is endowed with exceptional natural resources, including minerals such as cobalt and copper, hydropower potential, significant arable land, immense biodiversity, and the world’s second-largest rainforest. 

DRC has the third largest population of poor people globally, which remains widespread and pervasive, and is increasing due to impacts from COVID-19.In 2018, it was estimated that 73% of the Congolese population, equaling 60 million people, lived on less than $1.90 a day (the international poverty rate). As such, almost 14% — or one out of six people living in extreme poverty in SSA — live in DRC. 

Political Context 

Félix Antoine Tshisekedi Tshilombo, son of Etienne Tshisekedi, the country’s longstanding opposition leader, won the December 2018 presidential election. He succeeded Joseph Kabila, who had led the country for 18 years, in the first peaceful transition of power in the DRC’s history. 

Following President Félix Tshisekedi’s establishment of a new political alliance known as the "Sacred Union," the former Prime Minister and the head of the Senate stepped down in January and February 2021. On February 15, a week after he was sworn in as Head of the African Union, President Tshisekedi appointed a new Prime Minister, Jean-Michel Sama Lukonde Kyenge, who had served as CEO of Gecamines, the state-owned mining company, since 2019. A new government was put in place last April to support the program of the President of the Republic and to prepare for the next general elections scheduled for 2023. 

On October 16, the National Assembly endorsed a new central electoral president, Denis Kadima and his team — already strongly contested before being confirmed by the head of state. 

 

 

Economic Situation 

After a pandemic-induced slowdown to 1.7% in 2020, economic growth rebounded to 5.7% in 2021 on strength in the mining sector and a recovery in the non-mining sectors. The mining sector was a key driver of growth with copper and cobalt production rising by 12.0 and 7.6 percent, respectively. Non-mining sectors (particularly agriculture and services) recovered, growing by 3.9 percent in 2021 despite economic restrictions due to COVIC-19. 

The current account deficit (CAD) narrowed to about 1.0% of GDP in 2021 (from 2.2 in 2020), reflecting a higher mining exports volumes and improved terms of trade. Despite a small decline in foreign direct investment, the narrower current account and the IMF’s SDR allocation boosted international reserves, which reached 6.4 weeks of imports in 2021 (from 2.1 weeks in 2020). With a slower depreciation rate of the CDF and a deceleration in inflation to 9.1 in 2021, the Central Bank progressively cut its policy rate from 18.5 percent in January 2021 to 8.5 percent in mid-June 2021 and to 7.5 percent in early 2022.

Higher commodity prices also lifted domestic revenues, which coupled with increased grants, allowed fiscal consolidation to be achieved despite higher expenditures. Fiscal accounts were balanced in 2021 compared to a budget deficit of 1.2 percent in 2020. Driven by higher social and infrastructure spending, public expenditure increased to 13.1 percent of GDP in 2021 from 10.1 percent in 2020.  Domestic revenue collection increased from 8.7 percent in 2020 to 11.2 percent of GDP with higher income and value-added tax collections and a better performance in non-tax revenue (of which mining revenue accounts for 30 percent). 

The medium-term outlook for DRC is favorable with growth estimated to accelerate to 6.4 percent by 2023. The mining sector – a key growth driver - is expected to expand further in 2022 and pick up pace by 2024 as Kamoa-Kakula - aiming to become the second largest copper mine in the world- enters its second phase of production in late-2022. However, DRC’s economy remains vulnerable to commodity price movements and growth performance of its major trading partners which might be disturbed by geopolitical conflicts and a resurgence of the pandemic.

The economic consequences of the Russian invasion of Ukraine and associated sanctions, through rising global food costs and higher oil prices, could exert strong pressure on inflation and on households’ consumption. The fiscal deficit could widen by 2022 as the government is likely to provide some cushion to higher oil and food prices. DRC’s immediate challenge is to maintain political and macroeconomic stability while stepping up ongoing reforms to ensure sustainable growth.

 

Social Context and Development Challenges 

On February 7, 2021, a resurgence of the Ebola virus disease (EVD) was reported in Butembo, in the province of North Kivu, where a previous epidemic (EVD10) had been declared over in June 2020. As of March 30, 2021, a total of 12 cases had been confirmed in four provinces: Biena, Butembo, Katwa, and Musienene. A total of four deaths and four recoveries have been recorded. The 11th epidemic of the EVD was officially declared over on November 18, 2020, with 119 confirmed cases and 55 deaths. 

On October 8, a new case of Ebola was reported in North Kivu province. Immediately a vaccination campaign began. As of October 16, 2021, three new cases, including one death, have been confirmed in the Butsili health area in northeastern DRC, bringing the total to five confirmed cases with three deaths.

DRC ranks 175 out of 189 countries on the 2020 Human Development Index, though some HCI indicators are estimated to have slightly improved from 2018 to 2020. DRC’s Human Capital Index is 0.37%, below the SSA average of 4.0%. This means that a child born in DRC today will be 37% as productive in adulthood as she could be if she enjoyed complete education and full health in her early years.

On average, a Congolese child receives 9.1 years of schooling, though translating into 4.5 years of Learning-Adjusted Years of School (2020 estimate). 43% of children are malnourished

The DRC’s natural resources are immense and diverse, and the country has the world’s second largest primary humid tropical forest endowment and carbon sink globally. However, forest loss rates have accelerated in recent years, and in 2020, the DRC lost 1.31 million ha of natural forest, equivalent to 854 million ton of CO₂ of emissions. This has had deleterious environmental impacts (including on climate change, biodiversity, and rainfall patterns) and is threatening the livelihoods of the 35 million people who depend on forest resources. 

Last Updated: May 09, 2022

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