2017 Index of Economic Freedom

Democratic Republic of Congo

overall score56.4
world rank117
Rule of Law

Property Rights40.6

Government Integrity28.6

Judicial Effectiveness48.7

Government Size

Government Spending94.7

Tax Burden73.4

Fiscal Health99.3

Regulatory Efficiency

Business Freedom59.9

Labor Freedom38.4

Monetary Freedom78.6

Open Markets

Trade Freedom64.6

Investment Freedom30.0

Financial Freedom20.0

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Quick Facts
  • Population:
    • 81.7 million
  • GDP (PPP):
    • $62.9 billion
    • 7.7% growth
    • 7.9% 5-year compound annual growth
    • $770 per capita
  • Unemployment:
    • 3.8%
  • Inflation (CPI):
    • 1.0%
  • FDI Inflow:
    • $1.7 billion
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Economic development in the Democratic Republic of Congo (DRC) has been severely undermined by decades of instability and violence. Poor economic management worsened by repeated political crises has constrained economic freedom and driven much of the population into persistent poverty. The government’s inability to provide even basic public goods reliably further limits economic opportunity.

Entrepreneurial activity is curtailed by an uncertain regulatory environment and the absence of institutional support for or facilitation of private-sector development. Arbitrary taxation, poor infrastructure, marginal enforcement of property rights, and the weak rule of law have driven many people and enterprises into the informal sector, which accounts for more than 80 percent of economic activity.

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Background

Rebel groups remain active, primarily in the eastern part of the country where the United Nations has a peacekeeping mission. Joseph Kabila, who in 2006 won the first multi-party election in 40 years, was reelected in December 2011 in a process rife with violence. His schemes to secure a constitutionally prohibited third term have sparked major protests that state security services have suppressed, often brutally. The DRC’s immense natural resource wealth includes large deposits of rare earth minerals used in many technology products, but because of its political instability, the country remains among the least developed in the world.

Rule of LawView Methodology

Property Rights 40.6 Create a Graph using this measurement

Government Integrity 28.6 Create a Graph using this measurement

Judicial Effectiveness 48.7 Create a Graph using this measurement

Protection of property rights is weak and dependent on a dysfunctional public administration and judicial system. Human rights abuses and banditry deter economic activity. Massive government corruption and weak rule of law remain prevalent. Clandestine trade in minerals and other natural resources in eastern Congo by armed rebel militias and elements of the army helps to finance violence and depletes government revenues.

Government SizeView Methodology

The top personal income tax rate is 30 percent, and the top corporate tax rate is 40 percent. Other taxes include a rental tax and a tax on vehicles. The overall tax burden equals 12.5 percent of total domestic income. Government spending has amounted to 13.2 percent of total output (GDP) over the past three years, and budget surpluses have averaged 2.1 percent of GDP. Public debt is equivalent to 18.8 percent of GDP.

Regulatory EfficiencyView Methodology

The regulatory system remains unfavorable for private entrepreneurship. Outmoded regulations increase the cost of running businesses and hamper private-sector development. Agriculture is the largest source of employment, and formal-sector employment is negligible. Prices are controlled and regulated by the government, which also heavily subsidizes electricity.

Open MarketsView Methodology

Trade is important to the Democratic Republic of Congo’s economy; the value of exports and imports taken together equals 64 percent of GDP. The average applied tariff rate is 10.2 percent. Weak legal and regulatory systems impede foreign investment. The financial system provides a minimal range of banking services. Access to financing for entrepreneurial activity remains poor, and financial intermediation remains a luxury for most of the population.

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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