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DRC: Public finances, José Sele to consolidate achievements and initiate reforms

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DRC: Public finances, José Sele to consolidate achievements and initiate reforms

The new national treasurer, José Sele Yalaghuli is determined to consolidate the achievements of the action led by his predecessor, Henri Yav Mulang, and to initiate further reforms. Objective: to make public finance a real instrument for the development of the DR Congo. The handover of the torch took place this Saturday, September 7, 2019 during an official ceremony. All stakeholders in this sector took part.

« I hope to take this Ministry of Finance with great humility, determination and patriotism to put myself at the service of the Congolese population under the leadership of the President of the Republic. And to do this, I ask God to help me and bless the Congo, « said José Sele.

Acquis to consolidate

The new finance minister and his deputy find the state’s treasury globally under control. The transitional deficit, on the other hand, is relatively limited and covered by receipts collected during the months with tax deadlines.

« The rate of the Congolese franc against the US dollar at the end of August 2019 remained relatively stable compared to the end of December 2018. This is reflected in a cumulative annual depreciation rate of 1.1% and 0.2% respectively for interbank and parallel markets, « said the outgoing minister, Henri Yav.

DRC: Public finances, José Sele to consolidate achievements and initiate reforms

Moreover, the inflation rate has been steadily declining since the peak of 54.7% as of December 31, 2017 and stood at 7.2% at the end of December 2018, whereas this year’s projections place the annual rate at less than 5%, far from the goal of the beginning of this exercise. In parallel with this evolution, Henri Yav evoked the level of international reserves which continued to be close to one billion US dollars.

For his part, José Sele praised these achievements, recognizing the work done by his predecessor in an extremely difficult context characterized by essentially political (elections) and security-related domestic constraints, but also the exogenous constraints linked to the price shocks of the country’s export products. Congo Rd.

« Despite these difficulties, you have been able to maintain the fundamental balances of the macroeconomic framework that could help us to contribute a base line on which we must embark. You have kept the essentials under the constitutional prerogatives, which are vested in the Ministry of Finance, particularly a low level of indebtedness. You will be grateful for the story, « said the new Minister of Finance.

Four challenges to overcome

The outgoing Minister acknowledges that these results, positive as they may be, require consolidation by his predecessor. And this consolidation requires, first of all, the pursuit of efforts to increase domestic revenue mobilization with a view to generating the necessary resources for the financing of basic investments.

DRC: Public finances, José Sele to consolidate achievements and initiate reforms

Secondly, the maintenance of budgetary discipline at the level of public expenditure whose improvement of quality should be preserved.

There is also the need to take better advantage of the opportunities offered by bi-lateral and multi-lateral partners of the DR Congo in order to compensate for the insufficiency of domestic revenues collected to finance the needs of the State for sustained and inclusive growth.

And finally, the pursuit and completion of some reforms currently underway, including improvement of the yield of VAT, the computerized revenue chain, increased transparency and fiscal accountability.

Ilunkamba: « our goal, bringing economic growth to 10% on average »
If Henri Yav does not doubt for a moment that many other reforms will be undertaken by the Minister José Sele to increase the state’s fiscal margin, the new national treasurer already targets the legislative, structural and operational.

As a house son who has climbed the ladder for 17 years, José Sele Yalaghuli has mastered the realities of public finance in the Congo. His professional and political experience, his rigor, his loyalty and his patriotism attest to his ability to meet the challenges that lie ahead.

Eric TSHIKUMA

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DRC: the « education » project will be submitted to the WB Board of Directors in February 2020

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DRC: Education project to be submitted to World Bank Board in February 2020

The Government’s emergency project on free « Basic Education » will be submitted to the World Bank’s Executive Board in February 2020. According to the Vice President for Africa, Hafez Ghanem, preparations are being intensified to ensure that this deadline is met.

« We are working very quickly on this education project. And we plan to bring this project to our Council as early as February. Regarding the height of the amount, we are in the process of making evaluations. It’s going to be a big amount, around a billion US dollars, » he told reporters at the end of his meeting with the Congolese delegation led by Finance Minister José Sele Yalaghuli.

Indeed, this emergency project is part of World Bank support for the Government’s efforts to provide free basic education, the implementation of which began last September.

To relieve the pressure on public finances to allocate at least US$25-37 million each month, the World Bank has pledged to support the Congolese Government in this regard.

https://twitter.com/Zoom_eco/status/1184909044315758593?s=20In line with the commitment of the Head of State, Felix Antoine Tshisekedi, and the President of the World Bank, David Malpass, the Minister of Finance, José Sele Yalaghuli, has clearly indicated the Congolese Government’s firm desire to see the process speed up so that funds are released within an acceptable time frame.

« This is the right time for the partners of DR Congo to match the real political will of the Congolese national executive to meet one of the aspects of the World Bank’s mandate, namely: the fight against poverty, » he said at a previous meeting with the World Bank delegation led by Jean-Christophe Carret.

With regard to the health coverage programme, Hafez Ghanem reiterated his institution’s commitment to continue working alongside the Democratic Republic of Congo, particularly in the fight against Ebola.

 

He added: « We will also work with the Government on a new health programme to strengthen basic health centres and improve access to health across the country. »

However, he gave no indication of the amount of funding for this health programme, especially since it is currently under study.

As a reminder, the delegations of DR Congo and the World Bank held a working meeting on Thursday 17 October 2019 in Washington DC. Experts from both sides, led by José Sele Yalaghuli and Hafez Ghanem respectively, reviewed ongoing projects within the World Bank portfolio and those under preparation.

In addition to education and health, projects related to infrastructure, connectivity (roads) and the digital economy were also discussed.

Eric TSHIKUMA, from Washington

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DRC: the three axes of the Accelerated Programme to Combat Poverty and Inequality

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DRC: the three axes of the Accelerated Programme to Combat Poverty and Inequality

The President of the Republic launched his Accelerated Programme to Combat Poverty and Inequality in Kinshasa on Wednesday 16 October at the site of my valley in the commune of Mongafula.

This Programme aims to ensure that twenty million Congolese living in rural and peri-urban areas in the 145 territories of our country leave poverty or extreme poverty within the next 5 years.

It has three components: improving rural and peri-urban populations’ access to basic socio-economic infrastructure and services; promoting rural and peri-urban economies; and building capacity in managing for development results at the national, provincial and local levels.

The first component aims to increase the population’s access to basic services such as housing, electricity through the promotion of micro hydroelectric power plants, drinking water, health and agricultural access roads. This list is not exhaustive.

The second component aims to ensure that people in villages and peri-urban neighbourhoods have improved and stable sources of income and that they consume at least one balanced meal per day. This component will place particular emphasis on promoting inclusive agricultural sectors.

The third component aims to develop a culture of autonomy, which will result in the appropriation of development by the beneficiary populations, the strengthening of self-esteem, meritocracy and a motivated attachment to their living environment.

Substantial resources for this ambitious program!

« The Programme, the main components of which I have just unveiled, requires ambitious funding over several years, » said Félix Tshisekedi, aware of these challenges. In the face of such an ambition, the Head of State asks the Government to spare no effort to explore all possible avenues likely to provide the means for this saving action for the people.

It is with this in mind that the last Council of Ministers adopted the hypothesis of a budget reaching the 10 billion mark.

In addition, Félix Tshisekedi intends to engage the country in far-reaching reforms ranging from the rebuilding of the state with justice as the epicentre to the sectors of national life.

This is how he makes his main focus the fight against anti-values, particularly corruption, embezzlement of public funds, tax fraud, smuggling and tribalism. And all means will be used to ensure that all State revenues are channelled into the Public Treasury.

Finally, to make this programme a success, the President of the Republic is counting on the involvement of all his compatriots, beyond the divisions.
political.

Harris Kasongo

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DRC: Economic and financial situation at the heart of a meeting at the World Bank

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DRC: Economic and financial situation at the heart of a meeting at the World Bank

The economic situation in DR Congo is the focus of a meeting on Thursday 17 October 2019 at the World Bank’s headquarters in Washington DC. The Minister of Finance, José Sele Yalaghuli, leads the delegation of Congolese experts.

In his presentation, the national silversmith described a macroeconomic framework for DR Congo that has remained stable.

Despite accumulated deficits of 420 billion Congolese francs at the end of September 2019, domestic prices and the exchange rate fluctuated slightly. And at this rate, the Government reports inflation of 4.2% at the end of December 2019, which is below the 7% end of period forecast level.

Referring to the strategic and political orientations of the Government of the Democratic Republic of Congo, Minister Sele Yalaghuli cited in particular the tightening of public spending in order to limit deficits and the subscription of treasury bonds with the ambition of mobilizing 150 billion CDF by the end of 2019 to fill the gaps.

The first results are promising, especially since a small monthly budget surplus was recorded at the end of September 2019.

Moreover, added Sele Yalaghuli, the third orientation concerns the Government’s firm commitment to pursue the implementation of reforms with the support of partners to remove obstacles sector by sector and to be able to remedy them.

With regard to cooperation between the Congo DR and the Bretton Woods institutions. After the break-up of the formal programme with the IMF in 2012, the ongoing recovery strategy of the current discussions is based on two options.

First, the interim program. Then, the formal program. If the first one will cover the preparation period of the second one, the conclusion of the formal programme could take place after the third quarter of 2020.

« This is the right time for the partners of DR Congo to match the real political will of the Congolese national executive to meet one of the aspects of the World Bank’s mandate, namely: the fight against poverty, » José Sele Yalaghuli said, addressing the World Bank delegation led by Jean-Christophe Carret.

With the World Bank, experts from DR Congo are working on preparations and options to initiate disbursement of funds for the Government’s priority sectors on are: basic education and universal health coverage.

This interaction with World Bank teams continued, with Hafez Ghanem, Vice President in charge of the Africa region, as the focus.

Eric TSHIKUMA, from Washington DC

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