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- GDP (PPP):
- $30.5 billion
- 1.8% growth
- 4.7% 5-year compound annual growth
- $2,634 per capita
- Inflation (CPI):
- FDI Inflow:
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.
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.
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.
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.
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.
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.