[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"doc-detail-111167-en":3,"doc-seo-111167-105":29,"detail-sidebar-cat-0-en-105":91},{"code":4,"msg":5,"data":6},0,"success",{"doc_id":7,"user_id":8,"nickname":9,"user_avatar":10,"doc_module":4,"category_id":11,"category_name":12,"doc_title":13,"doc_description":14,"doc_content":15,"file_id":16,"file_url":17,"file_type":18,"file_size":19,"view_count":20,"is_deleted":4,"is_public":20,"is_downloadable":20,"audit_status":20,"page_count":21,"language":22,"language_code":23,"site_id":24,"html_lang":23,"table_of_contents":25,"faqs":26,"seo_title":13,"seo_description":14,"update_tm":27,"read_time":28},111167,962075006959,"Anda","https://ap-avatar.wpscdn.com/avatar/e0002397efbe92a78e?_k=1776741047341049297",8,"Research & Report","Republic of Congo - Joint Bank-Fund Debt Sustainability Analysis - Debt Distress Risk Assessment","The joint IMF-World Bank debt sustainability analysis for the Republic of Congo classifies the country as “in distress” on both overall and external debt, while concluding that debt remains “sustainable.” The assessment reflects ongoing restructuring and audit of domestic arrears, recurring temporary external arrears, and missed external debt service payments under the ECF in mid-2023. Under the baseline, improved debt management, fiscal discipline, higher oil prices, and completed restructuring are projected to keep liquidity and solvency indicators below thresholds by 2026, despite persistent risks from oil price shocks and potential regional financing tightening.","Public Disclosure  \nPub lic Disc losure Authorized  \nApproved by:  \nAbebe Adugna and Manuela Francisco (IDA) and Vitaly Kramarenko and Fabian Valencia (IMF) .  \nPrepared by the staff of the International Development Association (IDA) and the International Monetary Fund (IMF) .  \n\n| REPUBLIC OF CONGO: JOINT BANK-FUND DEBT SUSTAINABILITY ANALYSIS |  |\n| --- | --- |\n| Risk of external debt distress | In Debt Distress |\n| Overall risk of debt distress | In Debt Distress |\n| Granularity in the risk rating | Sustainable |\n| Application of judgment | Yes. While external arrears are currently below 1 percent of GDP, there is a high likelihood of further recurrence. |\n\nThe overall and external debt1 of the Republic of Congo are classified as “in distress”, reflecting the ongoing restructuring and audit of domestic arrears, as well as the recurrent accumulation of temporary external arrears but debt is assessed as “sustainable”. All legacy external arrears (those already existing by the inception of the ECF) have been resolved by the time of the third review of the ECF, with exception of disputed debt and pre-HIPC claims. However, some missed payments on debt service were overdue by more than one month, giving rise to program external arrears under the ECF by end-July 2023. Although the program external arrears are currently below the 1 percent of GDP applicable threshold, judgement was applied reflecting the high likelihood of additional accumulation due to shortcomings in debt management processes, as evidenced by repeated debt service payment slippages.  \nImproved debt management (including restricting new external financing to concessional terms), fiscal discipline, higher oil prices, and recently completed debt restructuring (including resolution of arrears, nominal haircuts on their outstanding stock, maturity extensions, and interest rate reductions) are projected to help all external liquidity and solvency indicators fall below their thresholds by 2026 under the baseline scenario.2 Still high oil prices in the near and medium terms (based on the October 2023 WEO assumptions) and higher non-oil growth supported by the authorities’  \n1 Most of the external debt is defined on a currency basis, except for the creditors whose residency can be tracked, which are defined on a residency basis. An example is the Regional Development Bank, BDEAC.  \n2The composite index (CI), estimated at 2.31 and based on the October 2023 World Economic Outlook (WEO) and 2022 World Bank Country Policy and Institutional Assessment (CPIA) data, indicates a weak debt carrying capacity for Congo.  \nreform agenda, coupled with increased debt amortization (because debt service is tied to high oil prices), are expected to reduce the public debt-to-GDP ratio and help avoid accumulation of new domestic arrears.  \nNevertheless, there are major external and overall debt-related risks, as signaled by the PV of the public debt-to-GDP indicator exceeding its benchmark through 2035 and one external debt indicator breaching is respective threshold that is, however, contained within 3 years.3 Even though the PV of overall public debt-to-GDP ratio breaches its benchmark extensively, it is assessed as sustainable given that the risks are mitigated by (i) steady and significant declines in the relevant ratios going forward; and (ii) expected accumulation of government deposits at the Central Bank.  \nThere are several risks to debt sustainability. The debt sustainability assessment is highly vulnerable to negative oil price shocks. Tighter conditions in regional markets (CEMAC banking systems) could be another downside risk if the government’s financing needs exceeded the current baseline projections.  \nGoing forward, the authorities should continue pursuing fiscal consolidation, enact policies for diversification to reduce risks and prepare for reduced long-term oil production and demand, clear domestic arrears, and continue enhancing debt management.  \n1. The coverage of pu","cbCaicIIQxiqBrc5","https://ap.wps.com/l/cbCaicIIQxiqBrc5","pdf",930357,1,30,"English","en",105,"# Key Risk Ratings\n## External and Overall Debt Distress\n# Judgment and Arrears Dynamics\n## External Arrears Under the ECF\n# Baseline Outlook and Drivers\n## Debt Management, Fiscal Discipline, Oil Prices\n# Principal Risks and Mitigating Actions\n## Oil Price Shocks and Market Tightness\n# Scope and Institutional Coverage\n## Central Government, SNPC, Contingent Liabilities\n## Social Security Related Domestic Arrears","[{\"question\":\"How does the analysis classify Congo’s overall and external debt risk?\",\"answer\":\"Both overall and external debt are classified as “in distress,” even though the assessment judges debt as “sustainable.”\"},{\"question\":\"Why was judgment applied regarding external arrears?\",\"answer\":\"Although external arrears were below 1% of GDP, the assessment applies judgment due to a high likelihood of recurrence, evidenced by repeated external debt service payment slippages.\"},{\"question\":\"What factors are expected to improve external liquidity and solvency indicators by 2026?\",\"answer\":\"Improved debt management (including restricting new external financing to concessional terms), stronger fiscal discipline, higher oil prices, and recently completed debt restructuring are projected to move indicators below thresholds by 2026.\"}]",1784488919,76,{"code":4,"msg":30,"data":31},"ok",{"site_id":24,"language":23,"slug":32,"title":13,"keywords":33,"description":14,"schema_data":34,"social_meta":86,"head_meta":88,"extra_data":90,"updated_unix":27},"republic-of-congo-joint-bank-fund-debt-sustainability-analysis-debt-distress-risk-assessment","",{"@graph":35,"@context":85},[36,53,68],{"@type":37,"itemListElement":38},"BreadcrumbList",[39,43,47,50],{"item":40,"name":41,"@type":42,"position":20},"https://docshare.wps.com","Home","ListItem",{"item":44,"name":45,"@type":42,"position":46},"https://docshare.wps.com/document/","Document",2,{"item":48,"name":12,"@type":42,"position":49},"https://docshare.wps.com/document/research-report/",3,{"item":51,"name":13,"@type":42,"position":52},"https://docshare.wps.com/document/republic-of-congo-joint-bank-fund-debt-sustainability-analysis-debt-distress-risk-assessment/111167/",4,{"url":51,"name":13,"@type":54,"author":55,"headline":13,"publisher":57,"fileFormat":60,"inLanguage":23,"description":14,"dateModified":61,"datePublished":62,"encodingFormat":60,"isAccessibleForFree":63,"interactionStatistic":64},"DigitalDocument",{"name":9,"@type":56},"Person",{"url":40,"name":58,"@type":59},"DocShare","Organization","application/pdf","2026-07-20","2026-07-19",true,{"@type":65,"interactionType":66,"userInteractionCount":20},"InteractionCounter",{"@type":67},"ViewAction",{"@type":69,"mainEntity":70},"FAQPage",[71,77,81],{"name":72,"@type":73,"acceptedAnswer":74},"How does the analysis classify Congo’s overall and external debt risk?","Question",{"text":75,"@type":76},"Both overall and external debt are classified as “in distress,” even though the assessment judges debt as “sustainable.”","Answer",{"name":78,"@type":73,"acceptedAnswer":79},"Why was judgment applied regarding external arrears?",{"text":80,"@type":76},"Although external arrears were below 1% of GDP, the assessment applies judgment due to a high likelihood of recurrence, evidenced by repeated external debt service payment slippages.",{"name":82,"@type":73,"acceptedAnswer":83},"What factors are expected to improve external liquidity and solvency indicators by 2026?",{"text":84,"@type":76},"Improved debt management (including restricting new external financing to concessional terms), stronger fiscal discipline, higher oil prices, and recently completed debt restructuring are projected to move indicators below thresholds by 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