Treasury bonds indexed in the Democratic Republic of Congo (DRC) continue to be a means of financing for the Congolese government. During the recent auction session which took place on October 10, 2023, the government was able to borrow 72.60 billion Congolese Francs, or more than 29 million dollars, on the local financial market. This issue attracted the interest of four bidders, which made it possible to achieve a coverage rate of 121% of the amount put up for tender.
Interestingly, the Congolese government has set an interest rate of 27%, a decision that differs from usual market practices. This issuance of indexed Treasury bills and indexed Treasury bonds allows the government to compensate for deficits in the mobilization of public revenue, despite the efforts of financial authorities in this area.
The DRC, rich in mineral resources, can also count on the rise in prices of mining products to improve the mobilization of public revenue. However, the issuance of these financial instruments remains essential to support government policy.
It is important to emphasize that this issuance of indexed Treasury Bonds is a strategy adopted by many African countries to finance their public spending, taking advantage of investor interest in these fixed-yield financial instruments.
In conclusion, indexed Treasury Bond issues continue to be a resource mobilization tool for the Congolese government. Despite efforts to mobilize public revenue, these instruments make it possible to compensate for deficits and support government policy. It will be interesting to follow the evolution of these emissions and their impact on the Congolese economy in the medium and long term.
Sources:
– “DRC: The government borrows 72.60 billion FC from local financial institutions”, https://www.agenceecofin.com/obligations/1710-109648-rdc-le-temporel-emploi-7260-milliards-fc-aupres -local-financial-institutions, accessed October 18, 2023.