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Congo: Sets a 5 years record by repaying over 2 000 billion FCFA in debt in 2024

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For the first time since 2020, Congo's debt service surpassed 2,000 billion FCFA at the end of the 2024 budget year. According to the Congolese Amortization Fund's annual report, debt repayment reached 2,128.96 billion FCFA in 2024, compared to 665.78 billion FCFA in 2020, 1,052.65 billion FCFA in 2021, 1,762.91 billion FCFA in 2022, and 1,704.61 billion FCFA in 2023, representing a 224.6% increase over the period

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As per the report, Congo's debt service breakdown is 1,805.97 billion FCFA for principal  : 84.83% and 322.99 billion FCFA for interest (15.17%). The significant increase is due to the country's priority on domestic debt repayment, which reached 1,413.43 billion FCFA : 66.4%, up 45.28% from 2023. According to the Congolese Amortization Fund .Market debt accounts for 88.33% of repayments, followed by bank debt at 5.86%, and non-conventional debt or budget arrears at 5.81%.  External debt service, however, decreased by 2.18% to 715.53 billion FCFA, due to a reduction in principal repayment, which declined from 606.73 billion FCFA in 2023 to 584.48 billion FCFA in 2024. This debt repayment trend could bring multiple benefits to Congo, such as reducing the strain on public finances and allowing for greater investment in vital sectors like health, education, and infrastructure. In the long run, this approach may also lead to an improved financial rating and better access to financing on more favorable terms. Expected outcomes include enhanced investor confidence, lower default risk, and greater macroeconomic stability. In 2024, Congo's public debt reached 8,535.77 billion FCFA (+0.22%). This outstanding debt is composed of 39.32% external debt and 60.68% domestic debt. The evolution of the public debt ratio over the 2020-2024 period reveals a downward trend, although it remains above the community norm of 70%. After exceeding 100% of GDP in 2020 and 2021, the ratio returned to 97.37% in 2023, then to 92.31% in 2024, representing a 5.06 percentage point decrease in one year and a 16.92 percentage point decrease over four years. 'This decline is due to the erratic evolution of GDP, combined with the progressive clearance of payment arrears and the settlement of maturing debt obligations over the period under review. Congo's public debt stood at 8,535.77 billion FCFA in 2024, up 0.22%. The debt stock is comprised of 39.32% external debt and 60.68% domestic debt. Despite remaining above the 70% community threshold, the public debt ratio has shown a declining trend over the 2020-2024 period. After surpassing 100% of GDP in 2020 and 2021, the ratio fell to 97.37% in 2023 and 92.31% in 2024, marking a 5.06 percentage point decrease in one year and a 16.92 percentage point decrease over four years. According to the report, this decline is attributed to the erratic GDP growth, coupled with the gradual clearance of payment arrears and settlement of debt maturities during the review period

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christelle
JESSICA CHRISTELLE KOAMBI
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