BANGUI, BRAZAVILLE, LIBREVILLE, MALABO, N’DJAMENA, YAOUNDÉ, June 17, 2024 – The World Bank issued today its Spring edition of the semi-annual CEMAC Economic Barometer, a report that discusses the recent economic situation in CEMAC, followed by brief country analyses.
Here are some key highlights from the report:
1. Growth in CEMAC countries declined between 2022 and 2023 and remains insufficient to drive substantial poverty reduction.
Growth in the CEMAC region decelerated to 1.7% in 2023, down from 3.1% in 2022, due to a significant decline in oil activity in Equatorial Guinea and lower growth in Gabon, as transport disruptions affected mining and wood production in the country. Conversely, economic activities in the other CEMAC countries expanded, driven by higher oil production and investment in Chad, the non-hydrocarbon sector in Congo, services, manufacturing and agriculture sectors in Cameroon, and higher production of gold and timber and sawn wood production in the Central African Republic.
Over the years, average growth in CEMAC has been lower compared to countries from the West African Economic Monetary union (WAEMU). Going forward, moderate growth is expected in the region. The outlook is subject to risks including commodity price shocks, higher borrowing costs, stronger global trade disruptions, climate disasters, and insecurity and conflict in regions of Cameroon, Central African Republic, and Chad.
Real GDP growth in CEMAC, 2019-2026
2. Inflation in Central African countries was on the rise since late 2021 and began to decline in the second half of 2023.
On average, consumer prices decreased from 6.3% in December 2022 to 4.8% in September 2023, amid a continuously tightening monetary policy adopted by the regional central bank (BEAC) and lower prices of most commodities.
Average inflation in CEMAC, 2020-2023 (in percent)
3. Lower global oil prices had negative impacts for CEMAC’s trade, fiscal position, and regional reserves, which all deteriorated in 2023.
At the same time, public spending increased in most CEMAC countries, reducing the fiscal space and imposing challenges to contain the public debt. Total debt-to-GDP ratio stands above the CEMAC target debt ceiling of 70.0% of GDP in the Republic of Congo and Gabon.
Fiscal position (% of regional GDP)
4. High unemployment, informality, obstacles to business activities, and lack of opportunities are a challenge to reduce poverty.
In CEMAC, 1 in 4 youth is not working nor in school or training, a factor that can be a source of instability and social tension. To reverse the trends of lackluster growth and job creation, it is essential to adopt policies to promote inclusion and economic participation, especially by investing in people, to achieve better education and skills.
Raising living standards also requires creating a vibrant private sector, but firms and people are hampered by important infrastructure gaps. By 2021-2022, half of people in the Republic of Congo, and nearly 9 in 10 people in Chad and Central African Republic did not have access to electricity. Inadequate roads and ports, extensive trade controls, lack of labor skills and high costs of loans also hinder business activities.
Employment indicators
5. Higher and better spending on education, health, and social protection, along with improved governance, are needed to protect the most vulnerable and strengthen social inclusion in CEMAC.
The second phase (2021-2025) of the CEMAC Economic and Financial Reform Program (PREF-CEMAC II) considers human capital as a priority area. In line with this strategy, to secure funds for social areas and to support livelihoods it is key for CEMAC to improve governance. Countries need stronger institutions and improved capacity and efficiency to deliver public services and design and implement reforms. Institutional reforms and controls could lead to better management of resources, especially revenues from oil, mining, and wood activities.
