Inflation in the Democratic Republic of the Congo: an evolving situation
The Central Bank of Congo recently released its weekly economic outlook, highlighting the latest inflation data in the country. According to the report, the inflation rate came in at 0.17%, a slight increase from the previous week when it was 0.15%.
However, a downward trend in year-on-year inflation has been observed over the past three weeks, dropping from 23.25% to 22.95%. This decrease can be attributed to a drop in demand for certain goods and services, such as food, housing, water, electricity, gas and other fuels, as well as furniture, household items, restaurants, hotels and alcoholic and non-alcoholic beverages.
In detail, the consumption function of food and non-alcoholic beverages was identified as the most important, contributing 72.24% of total inflation. It was followed by housing, water, electricity, gas and other fuels (12.16%) and restaurants and hotels (7.28%).
It is also interesting to note that certain consumption items, such as miscellaneous goods and services, transport, health, leisure and culture, have seen a drop in inflation.
Separately, the Central Bank of Congo highlighted current estimates of the country’s real gross domestic product (GDP) growth. According to projections, growth should reach 6.8% in 2023, compared to 8.9% the previous year. This growth is considered significantly higher than that projected for sub-Saharan Africa as a whole, which is 4.0% according to the African Development Bank.
This development is mainly due to the growth of activity in the extractive industries, with an added value estimated at 11.7% in 2023, against 22.6% in 2022. On the other hand, non-mining activities should experience an increase. growth of 4.4% against 3.1% the previous year.
The Central Bank of Congo also stresses the importance of major infrastructure works, such as the local development program for 145 territories and the revival of the agricultural sector, in maintaining economic activity outside the mining sector.
In conclusion, although inflation in the Democratic Republic of Congo has increased slightly in recent weeks, a downward trend year-on-year has been observed. In addition, economic growth forecasts remain encouraging, thanks in particular to the dynamics of the extractive industries and investments in infrastructure