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How to Reform the Democratic Republic of Congo

7 minute read
Noel K. Tshiani M. is an economist at the World Bank.

Every return visit to my native country, the Democratic Republic of Congo, brings fresh surprises—almost never the good kind. This is especially true outside the relative comfort of upper-class Gombe district in Kinshasa, the capital, and above all in rural areas, where most of the country’s almost 80 million people live.

While vacationing in Mbuji Mayi in the Eastern Kasai province in 2012, I spent three days in a guest house owned by the Miba government-run diamond company. Built in the 1930s, it lacked running water for bathing, cooking or sanitation. Instead, small children delivered buckets of water for 50 francs each—missing school so they could bring home the equivalent of about 40 cents at the end of the day.

I urged both the provincial governor and the country’s president to urgently rehabilitate nearby Tshala Dam, also built in the 1930s, to provide water and electricity for the province’s 7 million people. This would have cost about $53 million. Returning three years later, however, I found the situation unchanged: Money that could have done the job had been channeled instead into building a new soccer stadium for the local team.

Decades after independence from Belgium, this vast, diverse and young country—blessed with abundant natural resources that have drawn migrants, and a few investors, from around the world—remains mired in violence, poverty, plunder and despair. Civil wars since 1996 have resulted in some six million deaths and destroyed the country’s decades-old economic infrastructure and industrial base. In the eyes of its own people and those of the world, DRC represents a tragic failure of governance. Despite possessing one of the planet’s richest troves of natural resources, government cannot meet the basic needs of the governed.

Unemployment stands at a staggering 80%. Conflict, insecurity, sexual and gender-based violence, and graft are epidemic. The State Department’s most recent annual report on human rights around the world described corruption in the DRC as “endemic,” noting that officials often act with impunity and rights abuses remain widespread—particularly among women, children and other vulnerable groups. The DRC consistently ranks among last in the U.N. Development Program’s Human Development Index. And with a per capita GDP of $394 in 2015 and average life expectancy of about 50, it is also arguably the poorest country in the world, with 88% of its people living below the $1.25-per-day international poverty line.

In June 1998, the newly introduced Congolese franc traded at 72 cents on the U.S. dollar. Today, it is essentially worthless. As the result, 95% of the economy is conducted in U.S. dollars, leaving the central bank unable to collect seigniorage revenues or conceive and implement independent, credible monetary policy.

Health and education indices rank among the world’s lowest, while only about 10% of the population, mainly city-dwellers, enjoy reasonable access to either electricity or potable water. Within families, children are often forced to take turns eating. Basic infrastructure such as roads, ports, airports, rail and air transport, and sanitation, along with essential services such as education, are woefully inadequate.

Reserves of minerals and precious metals are worth some $24 trillion, according to World Bank Group estimates, but remain untapped—while untold thousands of Congolese desperate for a better life try their luck applying for visas to Europe and North America and more still forego such formalities and flee illicitly.

Transparency International classifies the DRC as one of the world’s most corrupt kleptocracies. In 2015, a U.N. panel reported more than 140 instances of violence and nearly 650 detentions related to the political process amid widespread speculation that President Joseph Kabila is scheming to remain in office beyond the legal end of his current term in December 2016.

The IMF has called for greater transparency and broad improvements in the mining sector to boost government revenue for poverty reduction. A panel of African experts led by former South African President Thabo Mbeki has meanwhile estimated that some 85% of revenue generated from DRC’s natural resources are pocketed off the books, unreported and untaxed, and diverted into private accounts—leaving the country with a paltry $9 billion annual budget.

As a DRC native who has worked for 25 years in some 85 countries as an international development economist, mainly in country management and private sector and financial sector development, I believe turning the country around demands no less than an updated version of the Marshall Plan that rebuilt post-war Europe.

The 15-year plan I propose for DRC comprises seven pillars of development, with the private sector driving growth and international and diaspora expertise tapped as needed. In its first phase, the program shall aim at advancing human capital, through education, health, and nutrition; creating opportunity and a level playing field for all, including Congolese women, who suffer not only legal discrimination, but one of the world’s highest rates of sexual and gender-based violence; promoting peace, security, rule of law, and democracy by restructuring the army and police and building strong democratic institutions and transparent practices; mobilizing domestic resources through transparent, effective tax collection and anticorruption measures; and supporting a responsible domestic private sector backed by functioning public administration and the rule of law. These initial pillars would lay the foundation for establishing strong institutions that President Barack Obama has often emphasized in his African policy as opposed to dictatorial strongmen who are to blame for the current state of affairs.

The second phase of the plan would endeavor to create opportunities for the people by taking on large-scale, labor-intensive infrastructure projects to create jobs as well as desperately needed enablers of trade and growth; boosting and accelerating local industrialization to refine and process minerals and mechanize farming, livestock and fisheries; promoting sustainable forest management; and supporting service sectors including tourism; and finally identifying and tapping domestic and regional market synergies.

What will this plan cost? I estimate about $800 billion over 15 years, in domestic resources, bilateral and multilateral aid, and foreign direct investment. It will also require a wholesale rethinking of development strategy and governance, with transparency a top priority. Executed wisely, it could turn one of the world’s poorest economies into a driver of African growth.

Economies most often succeed or fail based on the caliber and integrity of political leaders and governance structures. Good governance, rule of law, transparent management of natural resources, and honest, efficient tax collection should allow the state to develop an annual budget of at least $72 billion, lifting GDP per capita to $15,000 in a decade and a half.

Proverbial wisdom, repeated recently only in irony, says that “what’s impossible isn’t Congolese.” Bitter experience has taught too many of my compatriots quite the opposite. But we know from recent experience that great progress is possible, even in the poorest, most fragile corners of the world—progress that conveys prosperity and security not only for individual economies but, in this era of fast-moving global threats, for us all.

Refining and implementing this new Marshall Plan is where the country’s transformational work should begin to create conditions for a sustainable development beyond the usual cosmetic reforms. This plan will be a big step toward stabilizing and promoting development of one of the most important countries in Africa.

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