The economy should grow a fairly satisfactory 5.1% in 2013 and 5.3% in 2014 (up from 4.9% in 2012) but this should be seen against the worldwide economic outlook.
Apart from oil, the country has large mineral, forest and natural gas resources and good agricultural potential, yet the structure of the economy has not changed much.
More than ever, the government’s public investment programme is needed to diversify the economy and tackle a 44% poverty rate that especially affects young people and women, who both suffer from high unemployment.
Congo’s economic outlook is still quite good but external factors are a major threat. Gross domestic product (GDP) should grow 5.1% in 2013 and 5.3% in 2014. Apart from oil, the main pillars of growth are forestry, transport and telecommunications, and continued government investment in the public sector. These growth rates will depend on faster reforms and proper management of risks from a deteriorating world economic outlook, especially lower demand for oil and thus lower prices. This shows how vulnerable the economy is and the need to diversify it by developing the non-oil private sector.
The reform programme backed by the Extended Credit Facility (ECF) of the International Monetary Fund (IMF) has produced satisfactory results but it must be speeded up. The government’s public finance management programme (Programme d’action gouvernementale de gestion des finances publiques) has had good effects too. A law to make management of forestry resources more transparent was passed in 2011. The government has begun implementing an action plan to improve the business climate. Adopted in February 2011, the plan created a high council for public-private sector dialogue (Haut Conseil du dialogue public-privé) under presidential supervision and a one-stop shop for registering businesses. These measures, for the first time, enabled satisfactory reviews of all stages of the IMF-backed programme.
Despite this progress, bold reforms are still needed so the country can use its natural resources better to diversify the economy and promote broad long-term growth. Despite fairly satisfactory economic expansion, good prospects for oil, forestry, mining and agriculture and a per capita income of USD 2 300, which makes the Republic of Congo a lower middle income country, poverty is still high and achieving the Millennium Development Goals (MDGs) is a big challenge. Unemployment is also high, especially among young people aged 15-29. The structure of the economy has changed little and the country is still very dependent on oil (about 70% of nominal GDP and 90% of exports). Speeding up reform is thus vital, especially by urgently improving the business climate, upgrading infrastructure, developing human resources and boosting good management, especially of natural resources.
Figure 1: Real GDP growth 2013 (Central)
Table 1: Macroeconomic indicators
|Real GDP growth||3.4||4.9||5.1||5.3|
|Real GDP per capita growth||0.9||2.4||2.6||2.8|
|Budget balance % GDP||16.4||2.4||3.2||2.4|
|Current account % GDP||0.8||0.3||0.6||-3|
Recent Developments & Prospects
Table 2: GDP by Sector (percentage of GDP)
|Agriculture, forestry & fishing||-||-|
|Agriculture, hunting, forestry, fishing||4.9||3.7|
|Electricity, gas and water||0.7||0.5|
|Electricity, water and sanitation||-||-|
|Finance, insurance and social solidarity||-||-|
|Finance, real estate and business services||6.9||5.4|
|General government services||-||-|
|Gross domestic product at basic prices / factor cost||100||100|
|Public Administration & Personal Services||-||-|
|Public Administration, Education, Health & Social Work, Community, Social & Personal Services||5||4.4|
|Public administration, education, health & social work, community, social & personal services||-||-|
|Transport, storage and communication||5.2||5|
|Transportation, communication & information||-||-|
|Wholesale and retail trade, hotels and restaurants||6.8||7.1|
|Wholesale, retail trade and real estate ownership||-||-|
The economic recovery begun in 2008 has taken root in recent years. Buoyant forestry, construction and telecommunications sectors helped the economy grow 3.4% in 2011 and 4.9% in 2012. The economy was also boosted by ambitious public investment in energy and transport, which took public investment from 18.3% of GDP in 2008 to 26.0% in 2012 as inflation was curbed.
The cautious regional monetary policy of the Bank of Central African States (BEAC) kept inflation at 5.1%, but the overall budget surplus (excluding grants) fell from 16.4% of GDP in 2011 to 2.4% in 2012 due to the surge in government spending. The current account surplus was slightly down, from 0.8% of GDP in 2011 to 0.3% in 2012, because of a 10% drop in oil production. Debt relief under the Heavily Indebted Poor Countries (HIPC) Initiative and the Multilateral Debt Relief Initiative (MDRI), along with a prudent debt policy, significantly reduced the external debt and cut the country’s risk of excessive debt from moderate to low.
These good economic performances were underpinned by continuing structural reforms as part of the economic and financial programme backed by the IMF’s ECF, which restored macroeconomic stability and maintained the economic recovery. Governance improved in the extractive industries, with foreign audits of the national oil company (SNPC) and refinery company (CORAF), certification of oil resources, application of a new law on public contracts and implementation of the government’s PAAGIP public investment action programme.
The country’s economic prospects remain good but risks are high. GDP growth should be 5.1% in 2013 and 5.3% in 2014 and mining, forestry, construction and telecommunications are all doing well. Government investment is also upgrading economic infrastructure. But the flagging world economy, especially with lower demand and prices for oil, is a big threat. Other dangers are a slowdown in reforms at the end of the IMF programme and political developments in the sub-region.
Congo’s main challenge is to use its natural resources better to make the economy strong and diversified. Even if recent growth seems more balanced, it has not yet been accompanied by significant changes in the structure of an economy that remains dependent on oil, which still provides 70% of GDP, 90% of exports and provides 80% of government revenue. This huge dependence makes the country especially vulnerable to external shocks and is a serious obstacle to long-term growth and job creation.
Besides oil, Congo has big mining, forestry and natural gas resources that could, if properly developed, transform the economy and bring social and economic development. But this major potential is not much used, as shown by the small primary and secondary sectors. Obstacles to structural change and proper management of natural resources include poor-quality infrastructure in energy and transport, an ill-qualified labour force with skills not matched to the country’s needs, especially in key sectors, and vaguely defined property rights.
The government aims to step up efforts to build competitive infrastructure so as to boost growth and structural transformation based on natural resources. This includes setting up special economic zones (SEZ) backed by several emergent countries and creating an investment promotion agency targeting key sectors, establishing a development bank for small- and medium-sized enterprises (SMEs), opening schools and colleges to teach skills needed by sectors with strong growth potential, encouraging local processing with subsidies and tax breaks, and speeding up implementation of the global action plan to improve the business climate.
Budget policy is still based on preserving macroeconomic stability and achieving the goals of the poverty-reduction strategy (PRS) but was significantly harmed by the 2012 supplementary budget. The government continued its bold public investment programme to improve infrastructure and public services (70% of it funded by domestic sources), raising such spending by about 70% in 2012 to 26% of GDP. This sharp rise was due to extra spending related to the 4 March 2012 explosion at a military ammunition dump at Mpila, near Brazzaville, that officially killed at least 280 people, injured more than 2 500 and caused heavy material damage.
Most investment spending went to housing construction (77%), with 4% for education and healthcare. Good oil prices kept the budget position healthy but the surplus (on a commitment basis, excluding grants) shrank to 2.4% of GDP (from 16.4% in 2011). Higher government spending was also not matched by increased capacity, which limited public services and quality of spending. Boosting the capacity of key ministries to choose, draft and carry out projects will be crucial in making public investment significantly more effective.
The government continued its reform of the tax system through simplification and better collection, especially of non-oil revenue. All exemptions unsupported by law were abolished and a minimum 5% duty was imposed on oil transactions. A system of assigning taxpayers a single identification number is now being used, tax brackets have been harmonised and the system streamlined. All this increased the non-oil sector’s share of GDP from 8.0% in 2010 to 8.9% in 2012. But tax collection is still below par and major improvement in the tax administration will be needed to reduce fraud and evasion which, with exemptions, are the main cause of low non-oil revenue.
Budget policy in 2013 is focused on meeting the targets of the growth, employment and poverty-reduction strategy paper (DSCERP), rebuilding areas devastated by the March 2012 explosion and looking after those affected. The budget includes significantly higher spending on investment and to help the poor. Greater public spending will benefit basic education, skills training, healthcare, energy, transport, public works and housing. To increase the impact of public spending on growth and poverty reduction, the government will continue to implement the PAAGIP, with a focus on boosting capacity for assessing, choosing and carrying out projects.
The world economic slowdown, which may reduce forecast oil revenue, could undermine budget execution in 2013. But the country’s sizeable foreign exchange reserves and the adjustment machinery in the budget give the government plenty of room to absorb external shocks from erratic oil prices. Some of the oil revenue deposited in a BEAC stabilisation account can also be used when the oil price falls below the projected budget price.
Table 3: Public Finances (percentage of GDP)
|Total revenue and grants||32.4||38||42.5||43.1||44.6||46.2|
|Total expenditure and net lending (a)||27.2||21.7||26.1||40.7||41.4||43.8|
|Wages and salaries||4.3||3.1||3||3.1||3.4||3.4|
Monetary and exchange policy still aims to keep prices stable and demand policies in 2012 were generally in line with maintaining internal and external balances. Monetary policy, regionally controlled by the BEAC, continued to be cautious, with the CFA franc BEAC (XAF) pegged to the euro, allowing inflation to be kept to 5.1% despite the big public spending increases.
Without a major risk of renewed inflation, the BEAC kept its main intervention rate unchanged (with the refinancing rate at 4%). Overall demand policies did not seem to have “crowded out” the private sector. Loans to the rest of the economy rose 22% and private investment 6% in 2012. Government deposits with the banking system increased in a context of an expansionist budget policy with an overall surplus.
In the medium term, the BEAC’s monetary policy will continue to aim for price stability. The cautious monetary policy of the central bank, like the government’s prudent budget policy, will help keep inflation at 4.2% in 2013 and 2.9% in 2014.
Economic Cooperation, Regional Integration & Trade
Congo’s trade policy is largely determined by its membership of the Central African Economic and Monetary Community (CEMAC), whose customs laws, common external tariff and general preferential tariff regulations it applies. CEMAC’s tariff nomenclature has four brackets: 5%, 10%, 20% and 30%. The simple mean of the most-favoured-nation tariff is 18.7%, while tariff protection for agricultural products (World Trade Organization definition) is 23%. Congo accepts its obligations under the IMF’s Article VIII about current international transactions. So the tariff regime is fairly transparent and predictable, without formal non-tariff barriers, even if trading or importing some items, such as mineral water, sugar, flour and rice, is under licence.
Reforms to streamline and modernise procedures to make it easier to implement the CEMAC customs union and conduct regional trade continued in 2012. Customs formalities for most imports are now computerised through the Automated System for Customs Data (ASYCUDA), which handles declarations and calculates payments due. A one-stop shop was introduced in 2013 for all payments on imported goods. Despite this progress and significant government efforts in the past three years to upgrade the country’s infrastructure, Congo’s record in ease of trading is mediocre. The World Bank’s 2012 Logistics Performance Index ranked Congo 149th out of 155 countries overall, 155th for infrastructure and 149th for customs, reflecting the complexity, bureaucracy and cost of passing through customs, which is still about a third of the total cost of cross-border trade.
These deficiencies, along with delays in harmonising country policies, especially about transport taxes and custom procedures, explain the little progress towards trade integration. Less than 7% of Congo’s non-oil exports go to the five other CEMAC member states, who provide only about 3.5% of its total imports. The country’s main trade partners are China, France and the United States. They also supply most of Congo’s foreign direct investment (FDI), which continues to focus on the oil sector (about 90%). Congo is involved in trade talks between CEMAC and the European Union (EU) to reach economic partnership agreements (EPA).
Table 4: Current Account (percentage of GDP)
|Exports of goods (f.o.b.)||73.9||73.2||82.6||83.7||83.5||86.4||90.4|
|Imports of goods (f.o.b.)||20.8||28.1||29.7||34.8||42.4||48.6||55.1|
|Current account balance||14.5||-8.1||5.2||0.8||0.3||0.6||-3|
Debt relief under the HIPC Initiative and MDRI, along with a cautious debt policy, has enabled the government to significantly reduce the country’s external public debt to 21.9% of GDP in 2012 (from 59.3% in 2008) and preserve its long-term sustainability. The risk of excessive debt has also been reduced from moderate to low. An IMF and World Bank debt viability study in 2011 showed that the reasons for and nature of the debt were robust enough to withstand most shocks because of sizeable liquid assets that would avoid the need to seek external loans. More than 70% of public investment is funded domestically and soft loans are the rule. The internal public debt was 2.6% of GDP in 2012 (and 11.5% of total public debt), comprising commercial debt to the private sector as well as salary and pension arrears in restructured state firms being cleared by the government.
The legal framework for public debt management stipulates that the ministry of the economy, finance, planning, state firms and integration (MEFPI) is the only body authorised to contract debts for the government and issue debt guarantees. MEFPI’s sinking fund (Caisse congolaise d’amortissement) is in charge of managing the public debt. Great progress has been made expanding data on the debt and its management. The CCA collects complete statistics about the government’s foreign debt, including arrears and their composition, makes detailed projections of interest payments, and gathers data on the internal debt, with the help of a computerised debt-management system (DMFAS). The finance ministry posts a quarterly statement of the external debt and debt service projections on its website. But the CCA’s analytical capacity needs to be strengthened and its staff better trained.
Figure 2: Stock of total external debt and debt service 2013
Economic & Political Governance
Efforts have been made to improve the business climate but rules about starting a business and closing it down are still complicated and costly. Procedures for starting one were simplified as part of the 2012 budget and business people will now only pay one fee to get all the documents needed for this. The trader’s licence and authorisations to operate, transfer and expand business activity are all now free of charge.
Important steps have also been taken under the government’s global action plan to improve the business climate (adopted in February 2011), including a one-stop shop to register new firms, handbooks on commercial arbitration and strengthening the capacity of judges and legal officials to handle commercial law. Despite this progress, the country’s ranking in the World Bank report Doing Business 2013 (183rd out of 185 countries) reflects serious obstacles, especially to starting up and closing down a business. The country ranks 180th for ease of starting a business, with 161 days needed to do so (compared with an average of 34 in sub-Saharan Africa).
Progress has been made with incorporating the laws of OHADA (African Business Law Harmonisation Organisation), but judicial unreliability is a major obstacle. The Doing Business report says it takes 3.3 years to legally close down a business in Congo and enforcing contracts involves 44 procedures over 560 days and costs 53.2% of the claim. Abolishing all fees and charges not stipulated by law, such as the many dues required to get goods through customs, pushed Congo up two places (from 184th to 182nd) in the ranking for ease of paying taxes, but the low score shows how far the country still has to go.
The cost of labour is not a big problem for the private sector but hiring and firing costs, as well as non-salary charges, are quite high considering the quality of skills available.
Land ownership is quite unrestricted but formalisation and transfer of property deeds is long and costly and one of the major constraints in getting financial backing. The country is 156th in the Doing Business ranking for ease of registering property, with 55 days needed and costing the equivalent of 21.3% of the value of the property.
The financial system is fairly solid and quite resistant to external shocks in the medium term, but still undeveloped. Congolese banks largely comply with the CEMAC prudential ratios. Despite a substantial increase in credit activity, non-performing loans are only 1.1% of the total, compared with an average 9% among CEMAC member states. The minimum capital required for banks to guard against risks is less than 10% of assets. The sector’s robustness is partly due to better prudential monitoring by the Central African Banking Commission (COBAC).
Despite the increase in the number of banks from four in 2007 to nine in 2012 and the potential for large-scale funding of the economy, financial intermediation is low. The M2/GDP ratio was 37% in 2012 and total bank assets were 21% of GDP. The financial markets in Douala (Cameroon) and Libreville (Gabon) are also very small. Microfinance has not yet really taken off and is dominated by MUCODEC, which has more than 40 branches and 250 000 customers and deposits of around XAF 95 billion (about 90% of all microfinance assets).
The insurance sector, which is still quite small compared to that of most countries adhering to the Inter-African Conference on Insurance Markets (CIMA), comprises five companies, led by the state-owned ARC (Assurances et réassurances du Congo). This weak presence explains the difficult access to financial services, an especially big problem for SMEs, only 17% of which have loans or credit lines. Less than 5% of the population have a bank account. Congo fell seven places (from 97th to 104th) in the Doing Business 2013 report for access to credit. Data about loans made, costs and defaults has improved as the role of the central accounting and credit authorities has been strengthened. The legal and regulatory framework for financial services, largely set by regional financial institutions, is adequate but implementation still needs to be improved, especially by monitoring microfinance institutions better.
Public Sector Management, Institutions & Reform
Creation of the national anti-poverty committee to fight poverty (CNLP), backed by key ministries, and setting up a permanent technical secretariat for the PRS, helped with drafting and implementing policies. In the last cabinet reshuffle in September 2012, the economy, finance and planning ministries were merged into a single one (MEFPI) to boost policy co‑ordination and supervision. This should also improve drafting of policy and the budget. But overlapping responsibilities, ill-defined administrative roles, failure to respect clearly set division of authority and poor co‑ordination all seriously hampered implementation of strategies and sectoral policies and the ability of public services to react. This was exacerbated by low capacities and failure to share information. It partly explains Congo’s position in the 9th percentile for “government effectiveness” in the World Bank’s World Governance Indicators.
The authorities continue to implement key reforms in public finance management to build on progress already made. Transparency in oil resources management improved with quarterly foreign audits and posting of verification reports on the finance ministry’s website. Efforts have also been made to strengthen obligatory reporting of public finance management, but much more needs to be done here. Boosting the court of auditors and the inspectorate-general of finance enabled the clearing of the backlog in drafting and adopting payment laws. As in other countries, the 2011 payments law was sent to parliament in October 2012 at the same time as the 2013 budget. After a difficult start, a law on public procurement passed in 2009 is now fully operational and limits unauthorised actions. More than 80% of public contracts worth more than XAF 250 million are subject to bidding. The government’s reform programme now concentrates on choosing, prioritising and carrying out investment projects. The authorities have also started reforming the civil service, including introduction of a new merit-based pay scale.
Big challenges remain however. Management of the national oil company (SNPC) needs to be upgraded and its financial arrangements with producers and the national treasury clarified and made more transparent. Quality of data about extractive resources must be improved to conform with standards of the Extractive Industries Transparency Initiative (EITI). Internal and external monitoring is hampered by weak institutional and technical capacity of inspection bodies and their inadequate funding. Monitoring government action, the obligation to report on public finance management, and monitoring the use of public resources by parliament and civil society are also obstructed by poor-quality financial data. Congo ranks 144th out of 176 countries in Transparency International’s 2012 Corruption Perceptions Index, with a score of just 0.26.
Natural Resource Management & Environment
National legislation on the environment and forestry sector is fairly extensive and includes regulations about forestry, land ownership, fauna and protected areas. The environmental protection law is being revised to include guarantees for the economic, ecological and social sustainability of natural resources and take account of new environmental problems. The government has drafted new regulations to assess environmental impact and also signed with the EU a voluntary partnership agreement to implement the EU’s Forest Law Enforcement, Governance and Trade (FLEGT) action plan, which guarantees the legality of all Congo’s wood exports.
The government also launched in 2011 a national reforestation programme (PRONAR) to plant a million hectares of forest by 2020 to curb deforestation and soil degradation. Congo joined the Global Gas Flaring Reduction (GGFR) partnership in June 2012 as part of efforts to improve energy efficiency and reduce emissions related to oil production. Congo is backed by the UN Programme on Reducing Emissions from Deforestation and Forest Degradation (UN-REDD) to develop its potential and get funding for this environmental initiative. Ministries involved in managing natural areas and resources have sectoral policies to help sustainably manage forest ecosystems but implementation suffers from lack of money and staff. So efforts are still needed to apply laws and regulations.
Parliamentary elections in July and August 2012 were won by the ruling party but few people voted and no official turnout figures were released. The vote was marred by late opening of polling stations, late and inadequate supply of equipment to some of them and poorly trained vote-counting personnel. But international observers said the voting was free, transparent and credible. The ruling party retained its majority, with more than 80% of the 139 seats, but the opposition, which only won 19 seats, said the results were rigged. A coalition of 18 opposition parties appealed to the president on 29 October to convene a national conference as the only way to solve the country’s problems, but he did not officially respond.
Police used tear gas in March 2012 to disperse hundreds of victims of an ammunition dump explosion near Brazzaville who protested against slowness and corruption in the government’s payment of compensation. Lawyers went on strike a month later to protest against the arrest of two colleagues accused of undermining state security in connection with the blast. In September, the press council (Conseil supérieur de la liberté de communication, CSLC) suspended two weekly newspapers, La Voix du peuple (for nine months) and Le Glaive (six months). La Voix du peuple had defied a six-month suspension imposed by a court in May and Le Glaive was accused of printing “false news, seriously invading people’s privacy and manipulating public opinion”.
Thematic analysis: Structural transformation and natural resources
Congo’s substantial natural resources, mainly oil, are a solid base for structural reform of the economy. The importance of oil has steadily increased since deposits were discovered and production began in 1957 and world prices began to rise. Output rose to 269 300 barrels a day in 2012 (from 65 000 in 1980) through new investment and full production of initial deposits. Congo is now the fifth largest producer in sub-Saharan Africa and oil is 70% of its nominal GDP and 90% of total exports. The oil ministry predicts output will peak at 140 million barrels in 2012 before declining to 40 million by 2029 unless new deposits are found. Recent estimates say the country has reserves that would last for another 40 years at the present rate of production.
Oil revenue (about 80% of government income) funds a great deal of public investment, which was USD 1.2 million between 2009 and 2012. (More than 70% of infrastructure spending is from domestic resources.) Oil income allowed the government to launch a bold programme to upgrade energy and transport infrastructure that should help economic diversification. A special “oil reserves fund” has been opened at the BEAC to receive unbudgeted surplus revenue from higher oil prices.
The country has other substantial mineral reserves, along with forestry resources, natural gas and good agricultural potential. Gas reserves are estimated at between 1.7 trillion and 2.6 trillion cubic metres (20 years of production at the current rate). Iron reserves are put at more than 2 billion tonnes and Congo has the world’s second biggest forestry reserves after the Amazon. The forestry sector is 10% of non-oil GDP and generates XAF 100 billion in exports of wood (the country’s second biggest export) and more than XAF 20 billion annually in tax revenue. Sustainable production of wood is estimated at 5 million cubic metres (1 million in 2011). Congo also has 10 million hectares of arable land. The huge mining potential is beginning to be exploited, with four projects under way, including one expected to start production in late 2013 and another in 2016, as part of the Congo Iron and Mining Project Development. But development of all these resources is hampered by serious structural constraints.
Congo has not yet managed to take best advantage of its natural resources. Management transparency has however improved with quarterly certification of oil resources by foreign auditors and posting of verification reports on the finance ministry website, new laws to improve management transparency in forestry and in mining (especially granting concessions) and signing up to the FLEGT action plan, which guarantees the origin and sustainability of wood products.
But natural resources management needs to be greatly improved with more and better information on extractable resources to conform with EITI standards, better management of the extractive-industry value chain (including maximising oil revenue through good contracts with oil companies) and better use of government resources through improved public finance management.
Profits from natural resources development have enabled the government to speed up its national transport programme and quadruple energy supplies over the past three years. Revenue from natural resources, especially oil, has also funded anti-poverty efforts and economic growth. Oil prospection and production has generated spillover activity, especially in metal industries, maintenance, technical assistance for drilling, seismic exploration and other services for oil companies. Other sectors, however, have benefited little from natural resources, so structural change to the economy over the last two decades has been limited.
Economic growth in recent years seems to have been more balanced but has not really changed structures. Oil has been the pillar of the economy since the 1980s. It provides 70% of nominal GDP, making the economy vulnerable to external shocks. Also, because the oil industry is capital-intensive, it provides few jobs. The non-oil sector has shrunk, with the tertiary sector contributing 18% of GDP, the secondary sector only 7% and the non-oil primary sector less than 5%. The weakness of the primary and secondary sectors contrasts with the importance of the country’s natural resources, showing a potential for economic transformation undeveloped because of major structural impediments.
The main obstacles to this are poor infrastructure, a largely unskilled labour force and an unfavourable business climate. The lack of good infrastructure is marked in the energy and transport sectors, with only 10% of roads surfaced and only 38% of these in good or fair condition. Despite increased energy production capacity, inadequate electricity supply comes at the top of a list of ten complaints by businesses. Infrastructure services are still very costly, undermining competitiveness and productivity. Ill-trained labour and unsuitable skills (as shown by 17% unemployment among higher-education graduates) prevent the huge needs of the economy’s promising sectors from being met. Serious problems with the business climate, as shown by the country’s low rankings in the Doing Business 2013 report, are other big obstacles to economic diversification. Legal unreliability is a major barrier to the private investment that is so vital for transforming the economy. These weaknesses are exacerbated by poor management of natural resources.
The government knows how important the country’s natural resources can be for structurally transforming the economy and intends to step up its efforts to create the best conditions for this to happen. It plans to speed up building competitive infrastructure, especially the current upgrading of the road and rail corridor between the expanding port of Pointe-Noire and Brazzaville. It intends to create (with the help of several emerging countries) special economic zones (SEZ) and an investment promotion office to boost key economic sectors, a development bank for SMEs and vocational training colleges for skills needed in high-growth economic sectors (like two such centres in Pointe-Noire and Brazzaville specialising in construction and industrial maintenance). It will also encourage local processing of resources with subsidies and tax breaks and speed up the global action plan to improve the business climate. Finally, the government has launched a forestry and environmental programme to assess resources and improve the management of concessions.