Congo (Democratic Republic of)

Hopes for a swift peace agreement in the East are fading

Fighting intensified in the east from October 2023 between the M23/AFC (March 23 Movement/Congo River Alliance) and the Armed Forces of the Democratic Republic of Congo (FARDC), supported by local armed militias known as “patriots”. In early 2025, the M23 advanced in the eastern provinces of North and South Kivu, capturing the strategic cities of Goma and Bukavu in January and February. The ceasefire, signed on 24 April 2025 under Qatari mediation and reaffirmed by a declaration of principles on 19 July, was broken on 10 August. Since that time, fighting has continued, with each side blaming the other, which jeopardises the prospects for peace. The M23 Movement is demanding the release of more than 700 prisoners and intends to maintain its control over the two Kivu provinces, making any lasting agreement uncertain. In addition, the lack of credible military deterrence on the part of the central government and the emergence of new militias, such as the Wazalendo, which support the FARDC, is further complicating negotiations. The M23 has the military advantage, with an estimated contingent of 3,000 to 5,000 fighters. The UN estimates the figure at double given the support of the Rwandan Defence Forces (RDF), the presence of which Kigali continues to deny. The state's administrative presence in the East has evaporated, leaving the M23 in place, while the Southern African Development Community's armed mission in the DRC (SADC's SAMIDRC) began its withdrawal at the end of April.

A peace agreement was signed on 27 July 2025 between the Democratic Republic of Congo (DRC) and Rwanda, under the joint mediation of the US and Qatar. It notably provides for the withdrawal of the RDF and includes a joint security coordination mechanism to track down armed groups and share intelligence, commitments on the return of refugees, humanitarian access and cooperation with the United Nations Organisation Stabilisation Mission in the Democratic Republic of Congo (MONUSCO). Introducing the mechanism could prove to be laborious. Pressure exerted by Washington can be explained by the latter’s desire to obtain a preferential mining agreement and secure a strategic supply chain, as eastern DRC is rich in natural resources (gold, tin, tantalum and tungsten). China also remains a major diplomatic and commercial partner of the DRC, with Chinese companies controlling nearly 80% of the country's copper and cobalt mines. The 2008 agreement between these companies and the DRC, which provides for the construction of infrastructure in exchange for access to minerals, was renegotiated in 2024 in a manner more favourable to the latter. However, civil society believes that the revised clauses are still insufficient. At the regional level, Uganda is asserting itself as a military ally: on 20 June 2025, a cooperation agreement was signed between the two countries to combat the Allied Democratic Forces (ADF), an armed group originally formed by former Ugandan rebels and affiliated with the Islamic State. Kampala is seeking to prevent the return of attacks on its soil and to contain the influence of the M23 and Rwanda by strengthening its presence in the Far North, particularly in Ituri, a strategy that has also been adopted by Burundi in South Kivu. MONUSCO has put its withdrawal plan on hold and is providing reinforcements, especially in Ituri.

The repercussions of the infighting are considerable, both economically and diplomatically, as well as from a humanitarian perspective: 7 million internally displaced people, deterioration of the health situation (a cholera epidemic), increased risk of malnutrition, in a context where nearly 72% of the population lives in extreme poverty. Furthermore, the takeover of the East of the country by armed groups is depriving the Congolese economy of additional extractive revenues, particularly from gold mining.

Copper is the economic growth driver

Growth slowed slightly in 2025 due to less sustained mining expansion, but is expected to stabilise in 2026. The extractive sector and associated infrastructure projects will nevertheless remain the driving force behind the economy. Mining production will increase, driven mainly by copper, cobalt and zinc, whose deposits are located outside the combat zones, in the far south (Tanganyika, Katanga and Lualaba). Since 2025, copper has benefited from higher prices and the expansion of several mining sites, notably Kamoa-Kakula in Lualaba province, whose annual production reached 600,000 tonnes at the end of 2025. In February this year, the government suspended cobalt exports in order to counter the fall in its price, which had fallen fourfold in three years due to oversupply. In 2024, the DRC accounted for three-quarters of global cobalt production. This suspension is expected to be lifted in 2026 as prices recover, so as not to hamper copper production, which is closely related to cobalt production. Last, zinc is expected to be an important driver of growth in the extractive sector, thanks to the full commissioning of the Kipushi mine, which has an annual capacity of 278,000 tonnes of concentrate. These resources are exported by lorry, mainly to the port of Durban, and to a lesser extent to the Angolan railway line leading to the port of Lobito, whose 1,300 km track has been renovated by China. The US, the EU and the African Development Bank have committed to financing the renovation of the Congolese section (800 km) and its connection. The development of this infrastructure, the financing of which is expected to be completed by 2026, will enhance the attractiveness of the territory by improving ocean access and regional connectivity, thereby boosting the country’s mining sector and exports. Construction is also expected to benefit from this project.

However, non-mining investment will continue to be curbed by the poor business environment, which is impacted by endemic corruption and security tensions. Public and domestic investment is hampered by low government revenues and the high cost and scarcity of credit. The Government Action Programme (2024-2028), valued at nearly USD 93 billion, aims to stimulate economic activity by supporting key sectors such as agriculture, transport and security. However, the rollout has been slow. Foreign investment is concentrated in mining and related transport infrastructure (roads, airports and ports). For example, the Banana deep-water port project, located on the narrow coastline, is co-financed by the Emirati company DP World and the British public fund British International Investment (BII), for a total amount of approximately USD 1.2 billion. The first phase, which is scheduled for completion at the end of 2026, will enable the port to accommodate large ships, with an annual handling capacity of 450,000 TEU and a storage area of 30 hectares. Private consumption, which accounts for 63% of GDP, continues to be affected by the humanitarian crisis resulting from the conflict in the East of the country. However, inflation will continue to ease thanks to the stabilisation of the exchange rate against the US dollar, the weakening of global crude oil prices and restrictive monetary policy. The Central Bank of Congo is expected to gradually lower its rate, which was kept at 25% at the last review in July 2025, in order to support economic growth.

Loss of control in the East slows down reduction of twin deficits

The budget deficit widened in 2025 due to the armed conflict. Security spending now accounts for 2% of GDP, while the government has doubled military salaries, which now represent 24.5% of the public wage bill, itself equivalent to 4.8% of GDP. Conversely, revenues have declined due to the loss of control over the territories of Ituri, North and South Kivu, leading to an estimated 4% drop in expected revenues from mining taxes. Gold, tin, tungsten and tantalum produced by artisanal mines under rebel control or influence are smuggled by land to neighbouring countries (Uganda, Rwanda) before being exported, often via Kenya, to the United Arab Emirates for processing and sale on the international market. In response to the weakened state, a revised budget was passed by the National Assembly in June 2025 which registered a 2.5 percentage-point decline in revenue compared to the initial budget. As a result, earmarked expenditure was also reduced by 1.7 points. The main austerity measures concerned the reduction of budgets allocated to ministerial and legislative institutions. In 2026, the deficit is expected to improve only very slightly provided that certain reforms planned under the IMF programme are implemented, notably the abolition of VAT and customs duty exemptions on basic necessities. In addition, revenues from the extractive sector, which account for around 30% of public revenues, should help to contain the deficit. The Sino-Congolese mining joint venture Sicomines has been paying an annual royalty of 1.2% of its revenue to the state since January 2024.

Deficit financing relies mainly on external multilateral resources, especially project loans and budgetary support (2.2% of GDP in 2025). In January 2025, the IMF approved two 38-month agreements: an Extended Credit Facility (ECF) worth USD 1.7 billion and a Resilience and Sustainability Facility worth USD 1 billion. USD 523 million has already been disbursed under the ECF. The moderate public debt ratio is expected to remain stable, with the external share (64.5% of the total) evenly distributed between multilateral (IMF, World Bank) and bilateral creditors; Chinese debt represented 4.7% of GDP in 2024. Domestic debt consists mainly of arrears (6.4% of GDP).

In 2026, the moderate current account deficit will narrow slightly on back of an improved trade surplus. Exports, almost exclusively from the extractive sector, will grow at a faster pace than imports. The DRC will be able to count on copper, both raw and refined, whose high prices and the completed expansion of the Kamoa-Kakula mine will boost revenues. In 2026, cobalt exports will have resumed, although they may be subject to quotas aimed at inflating prices. The DRC also exports gold, diamonds and crude oil. Although fighting in the East of the country is hampering trade, as minerals are mainly transported by truck, the main mining sites are located outside the conflict zones. Trade with China, which accounts for 70% of Congolese exports and 34% of imports, will continue to play a central role. Imports of capital goods (40% of the total) associated with infrastructure projects and financed by the private or public sector through the Government Action Programme, will remain high. However, the fall in global prices for refined oil, which is the second-largest import item, will help to reduce the overall bill. Infrastructure projects (mining, transport) will also fuel the structural deficit in services. The primary income deficit is also set to widen due to the expansion of the extractive sector, which is largely financed by foreign investors which repatriate profits. Conversely, the secondary income balance will remain positive, supported by diaspora remittances which account for around 5% of GDP. The level of international aid remains uncertain due to reductions in official development assistance, despite the ongoing humanitarian crisis. Last, the current account deficit will be largely financed by project grants and international project loans (0.8% of GDP in 2025), FDI (2.5% of GDP), and financial support from the IMF and the World Bank (1.6% of GDP). IMF payments will help replenish reserves, whose coverage is gradually approaching the three months of imports threshold, excluding aid.

Last updated:August 2025