Title: The Democratic Republic of Congo fights against fraud in the subcontracting sector to stimulate economic diversification
Introduction :
The Democratic Republic of Congo (DRC) has announced a new measure to combat fraud in the subcontracting sector. With more than 1,200 companies deregistered, Congolese authorities hope to create a strong middle class and diversify their economy. In this article, we will explore the measures taken by the State to remedy this situation and the prospects available to the DRC for developing its economy.
The problem of fraud in the outsourcing sector:
After an in-depth check by the Regulatory Authority for Subcontracting in the Private Sector (ARSP), the authorities identified more than 1,200 companies which did not comply with the regulations in force and which were thus evading tax. Indeed, these companies operated illegally and the majority of them received payments abroad, thus depriving the Congolese tax administration of essential resources. Additionally, some of these companies did not meet the requirement that at least 51% of shares must be owned by Congolese.
Measures taken by the State:
The Congolese authorities have decided to deregister these companies that do not comply with the subcontracting law. This decision aims to strengthen regulation in the sector and deter fraudulent practices. In addition, the partner companies of these deregistered companies will also be sanctioned, which reinforces the effectiveness of this measure.
The development of subcontracting as a lever for economic diversification:
The DRC is counting on the development of the subcontracting sector to stimulate its economic diversification. Around 400 new companies were admitted, bringing the total number to more than 15,000. The authorities’ objective is to reach 50 to 60,000 companies with majority Congolese capital by the end of the year. This expansion of subcontracting will create jobs and stimulate the country’s economic growth, notably by creating a strong middle class.
Prospects for economic diversification in the DRC:
By promoting the development of subcontracting, the DRC hopes to diversify its economy and not depend solely on the mining sector. By encouraging local entrepreneurship and strengthening the capacities of Congolese businesses, the country will be able to develop new sectors of activity and attract foreign investment. Creating a strong middle class will help reduce social inequality, thereby promoting more balanced economic development.
Conclusion :
Combating fraud in the DRC subcontracting sector is an essential step to boost economic diversification and create a strong middle class. The measures taken by the Congolese authorities, such as the delisting of non-compliant companies, show the country’s commitment to improving regulation in this key sector. By developing subcontracting, the DRC can hope to diversify its economy, attract foreign investment and create lasting jobs.