2017 Index of Economic Freedom

Chad

overall score49.0
world rank162
Rule of Law

Property Rights30.6

Government Integrity24.6

Judicial Effectiveness24.1

Government Size

Government Spending87.2

Tax Burden46.0

Fiscal Health74.6

Regulatory Efficiency

Business Freedom27.5

Labor Freedom44.9

Monetary Freedom74.3

Open Markets

Trade Freedom54.7

Investment Freedom60.0

Financial Freedom40.0

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Quick Facts
  • Population:
    • 11.6 million
  • GDP (PPP):
    • $30.5 billion
    • 1.8% growth
    • 4.7% 5-year compound annual growth
    • $2,634 per capita
  • Unemployment:
    • 5.6%
  • Inflation (CPI):
    • 3.6%
  • FDI Inflow:
    • $600.2 million
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Chad’s economy has expanded at an average rate of almost 5 percent over the past five years, but the volatility of economic growth has undermined economic development and poverty reduction. The weakness of the overall regulatory and legal framework hinders private-sector development. The economy relies on oil and agriculture, with the former accounting for 60 percent of export revenues.

Entrepreneurs continue to be hamstrung by institutional shortcomings. The inefficient judicial system lacks independence and is vulnerable to corruption. The state’s presence in the economy is still considerable. Despite significant fiscal adjustments in recent years, the budget remains chronically in deficit.

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Background

President Idriss Déby, who seized power as the leader of a rebel movement in 1990, won a fifth term in 2016. Voters approved a referendum scrapping presidential term limits in 2005, but Déby’s 2016 reelection was preceded by large street protests against his rule. Déby has faced various armed revolts and survived Sudanese-supported rebel attacks on the capital of N’Djamena in 2006 and 2008. In 2010, Chad and Sudan normalized relations. Chad has sent security forces to assist peacekeeping missions in Sudan (Darfur), the Central African Republic, Mali, and the Democratic Republic of Congo and is the major component of the multinational force battling Boko Haram in Nigeria.

Rule of LawView Methodology

Property Rights 30.6 Create a Graph using this measurement

Government Integrity 24.6 Create a Graph using this measurement

Judicial Effectiveness 24.1 Create a Graph using this measurement

Protection of private property is inadequate, and fraud is common in property transactions. Costs for property registration range from 8 percent to 15 percent of property value. The rule of law is weak, and the judiciary lacks real independence. Corruption is endemic and prevails at all levels of government, from the siphoning off of oil wealth by the presidential cabinet to petty corruption in the police force and local bureaucracy.

Government SizeView Methodology

The top individual income tax rate is 60 percent, and the top corporate tax rate is 45 percent. Other taxes include a value-added tax and a property tax. The overall tax burden equals 6.8 percent of total domestic income. Government spending has amounted to 20.7 percent of total output (GDP) over the past three years, and budget deficits have averaged 3.7 percent of GDP. Public debt is equivalent to 39.3 percent of GDP.

Regulatory EfficiencyView Methodology

The absence of modern commercial regulations imposes considerable costs on businesses, as do such other institutional deficiencies as a lack of access to financing. The labor market is mostly informal, and the workforce remains mostly unskilled. In 2016, spurred by permanently lower oil receipts, the government cut spending on some subsidies for state-owned enterprises.

Open MarketsView Methodology

Trade is important to Chad’s economy; the value of exports and imports taken together equals 67 percent of GDP. The average applied tariff rate is 15.1 percent. State-owned enterprises in several sectors distort the economy. Average citizens have little access to banking services, and high credit costs and scarce access to financing continue to constrain the small private sector.

Country's Score Over Time

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Regional Ranking

rank country overall change
1Mauritius74.70.0
2Botswana70.1-1.0
3Rwanda67.64.5
4Côte d'Ivoire 633.0
5Namibia62.50.6
6South Africa62.30.4
7Seychelles61.8-0.4
8Swaziland61.11.4
9Uganda60.91.6
10Burkina Faso59.60.5
11Benin59.2-0.1
12Mali58.62.1
13Gabon58.6-0.4
14Tanzania58.60.1
15Madagascar57.4-3.7
16Nigeria57.1-0.4
17Cabo Verde56.9-9.6
18Democratic Republic of Congo56.410.0
19Ghana56.2-6.8
20Guinea-Bissau56.14.3
21Senegal55.9-2.2
22Comoros55.83.4
23Zambia55.8-3.0
24São Tomé and Príncipe 55.4-1.3
25Mauritania54.4-0.4
26Lesotho53.93.3
27Kenya53.5-4.0
28The Gambia53.4-3.7
29Togo53.2-0.4
30Burundi53.2-0.7
31Ethiopia52.71.2
32Sierra Leone52.60.3
33Malawi52.20.4
34Cameroon51.8-2.4
35Central African Republic51.86.6
36Niger50.8-3.5
37Mozambique 49.9-3.3
38Liberia49.1-3.1
39Chad492.7
40Sudan48.8N/A
41Angola48.5-0.4
42Guinea47.6-5.7
43Djibouti46.7-9.3
44Equatorial Guinea451.3
45Zimbabwe445.8
46Eritrea42.2-0.5
47Republic of Congo 40-2.8
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