Congo-Brazzaville - Corruption
The economy is characterized by extensive corruption with all major business in the hands of the president and his family, the gap between rich and poor is growing, and all Congolese are penalized by an "inflation tax"-nine percent inflation has been eating away at their purchasing power. On the plus side, the government makes sure that civil servants and, especially, the security forces are well paid and paid on time.
The RoC has signed and ratified the UN anticorruption convention and participates in regional anti-money laundering agreements. While tender offers are regularly publicized, nonetheless, corruption is almost invariably linked to doing business in the country. In his April 16, 2016 inauguration speech, Sassou declared a new era had begun in which there would be no more corruption. Howver, there is an absence of substantiated figures on government spending, contract terms are not transparent, and bribes are regularly solicited, though Congolese law prohibits bribery. Recourse in the judicial system is limited as court cases are themselves subject to corruption and political influence. Despite the pervasiveness of corruption in the Congolese investment climate, the country is making progress putting mechanisms in place to address the challenges. Such efforts have included improved participation by diplomatic missions, international organizations, and international financial institutions in review of government programs.
In mid-2013, in a move towards increased transparency and greater integration with the wider international financial community, the GRoC engaged the three major financial rating agencies – Moody’s, Standard and Poor’s, and Fitch Ratings - to review the financial status of the RoC government and provide a sovereign credit rating. In November 2015, Moody's Investors Service changed the Ba3 rating outlook to negative from stable. Standard and Poor affirmed RoC’s B/B rating as Stable in September 2015, while Fitch in the same month revised its B+ outlook to Negative.
RoC also committed itself through the Highly Indebted Poor Countries (HIPC) debt relief initiative completed in 2010 to raising the internal controls and accounting system of the state-owned oil company SNPC to internationally recognized standards. This included taking steps to prevent conflicts of interest in the marketing of oil, requiring officials of SNPC to publicly declare and divest any interest in companies having a business relationship with SNPC, and implementing an anti-corruption action plan, with international support and monitoring by the International Monetary Fund (IMF). While recent Extractive Industries Transparency Initiative (EITI) reports covering oil receipts show matching private company remissions and government revenues, it appears that the SNPC continues to substantially underreport revenues. Nevertheless, in February 2013, EITI declared the RoC compliant.
As its oil revenues have decreased, the RoC has sought to diversify its economy through a number of other sectors, including the mining sector. In the past, the mining sector has been rife with corruption, which led to a suspension in 2004 of the RoC from the Kimberly Process. The RoC was reinstated to the Kimberly Process in 2007 following improvements in monitoring. However, like oil, the mining sector has been affected by the sharp drop in commodity prices and demand.
The timber sector is experiencing many of the same challenges as the mining sector. Very few timber concessions have been FSC-certified, and supply chain corruption concerns remain, even as timber exports are expected to increase.
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