IMF: DRC's 2020 budget of $10.2 billion is unrealistic

The International Monetary Fund said the $10.
2 billion budget proposed by the Democratic Republic of Congo was "unrealistic"
because of the country's declining copper and cobalt production.

The government is seeking a budget of 16.
9 trillion Congolese francs ($10.
2 billion) next year, with revenues expected to rise 63 percent
from this year.

But the IMF expects Congo's real income, including grants, to rise to about $6.
32 billion next year at only about $5.
5 billion
this year.

Philippe Egoume, the representative of the International Monetary Fund in Congo, recently told reporters in the capital Kinshasa: "It is very rare
for a country to increase the country's income by 50-60% from one year to next year.
" We think there are measures to increase revenue that could generate a net increase of 1-2% of GDP, so between $500 million and $1 billion
.
More important reforms were made, perhaps more, but an increase of $5 billion would be unrealistic
.
”

While the IMF expects Congo's economy to grow by 4.
5 percent this year, growth will slow to 3.
2 percent in 2020, largely due to the closure
of Glencore's Mutanda copper-cobalt mine last week.
According to Glencore, Mutanda will undergo a two-year period of care and maintenance, providing more than $626 million in revenue
to the government in 2018.

According to the International Monetary Fund, natural resource extraction typically accounts for about one-third of government revenue and 95 percent of Congo's export earnings, mainly from copper and cobalt
.

Egoume said the IMF's board would consider injecting about $370 million in mid-December to boost Congo's foreign exchange reserves
.
Congo's foreign exchange reserves have fallen by about half since the end of 2018 and are now only equivalent to about a week's worth of imports
.

Congo's central bank said its reserves had fallen to $873 million, equivalent to about three weeks' worth of imports, including the bank's domestic deposits
.