Republic of Congo: Sixth Review Under the Three-Year Arrangement Under the Extended Credit Facility, Request for Waivers of Nonobservance of Performance Criteria, and Financing Assurances Review

This paper presents Republic of Congo’s Sixth Review under the Three-Year Arrangement under the Extended Credit Facility (ECF), Request for Waivers of Nonobservance of Performance Criteria, and Financing Assurances Review. The authorities addressed the breach of performance criteria related to external debt service, new external non-concessional debt, and newly contracted debt guaranteed by natural resources. Waivers for nonobservance were granted, given the corrective actions taken. Economic recovery continued at a moderate pace amid challenging domestic and external conditions, while inflationary pressures have eased. Program performance was mixed in the sixth review, with structural reform implementation experiencing persistent delays. Reinvigorated reform implementation to enhance public financial and debt management, governance, and transparency will be critical to creating the fiscal space for development spending and attaining higher, more resilient, and inclusive growth. Accelerating the implementation of policies and reforms beyond the conclusion of this ECF Arrangement will further help reduce fragilities and place the Republic of Congo on a path of higher, more resilient, and inclusive growth. It will also contribute to regional efforts to preserve external stability for the Central African Economic and Monetary Union.