2022 Index of Economic Freedom

Democratic Republic of Congo

OVERALL SCORE47.6
WORLD RANK160
Rule of Law

Property Rights14.8

Judicial Effectiveness13.2

Government Integrity11.8

Government Size

Tax Burden74.4

Government Spending95.7

Fiscal Health97.4

Regulatory Efficiency

Business Freedom28.3

Labor Freedom54.0

Monetary Freedom63.7

Open Markets

Trade Freedom68.0

Investment Freedom30.0

Financial Freedom20.0

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Quick Facts
  • Population:
    • 89.6 million
  • GDP (PPP):
    • $100.5 billion
    • -0.1% growth
    • 3.3% 5-year compound annual growth
    • $1,106 per capita
  • Unemployment:
    • 4.6%
  • Inflation (CPI):
    • 11.3%
  • FDI Inflow:
    • $1.6 billion

The Democratic Republic of the Congo’s economic freedom score is 47.6, making its economy the 160th freest in the 2022 Index. The Democratic Republic of the Congo is ranked 40th among 47 countries in the Sub-Saharan Africa region, and its overall score is below the regional and world averages.

Despite a slight downturn in 2020, the Democratic Republic of the Congo (DRC) has enjoyed average annual economic growth of more than 3 percent over the past five years, based primarily on exploitation of the DRC’s natural resources. Since 2017, however, the DRC has recorded an 8.8-point overall loss of economic freedom and has fallen from the “Mostly Unfree” category to the “Repressed” category. Fiscal health is strong, but economic freedom is severely lacking in most other areas.

IMPACT OF COVID-19: As of December 1, 2021, 1,107 deaths had been attributed to the pandemic in the Democratic Republic of the Congo, and the government’s response to the crisis ranked 106th among the countries included in this Index in terms of its stringency. The economy contracted by 0.1 percent in 2020.

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Background

In 2006, Joseph Kabila won the Democratic Republic of the Congo’s first multiparty election in 40 years. He finally left the presidency under international pressure in 2019. Félix Tshisekedi was declared the winner of the 2019 presidential election, most likely as a result of a corrupt bargain with Kabila. Tshisekedi’s creation of a new parliamentary coalition in 2021 undermined Kabila’s influence. The DRC’s immense natural resource wealth, estimated at $24 trillion, includes large deposits of rare earth minerals used in many high-technology products. The DRC is Africa’s largest producer of copper and the world’s largest producer of cobalt, but its political instability and high inflation discourage international investors. The DRC is also one of the world’s least developed countries.

Rule of Law

Property Rights 14.8 Create a Graph using this measurement

Judicial Effectiveness 13.2 Create a Graph using this measurement

Government Integrity 11.8 Create a Graph using this measurement

Although the constitution protects ownership of private property, enforcement is lacking, and armed groups and government soldiers have seized private property and destroyed homes in conflict zones. Apart from a few reasonably well-functioning commercial courts, the judicial system is weak, unreliable, and corrupt. Corruption permeates all levels of government and all sectors of the economy. Clientelism, rent-seeking, and patronage have decimated fair competition.

Government Size

The top individual income tax rate is 40 percent, and the top corporate tax rate has been cut to 30 percent. The overall tax burden equals 7.5 percent of total domestic income. Government spending has amounted to 11.9 percent of total output (GDP) over the past three years, and budget deficits have averaged 1.2 percent of GDP. Public debt is equivalent to 15.2 percent of GDP.

Regulatory Efficiency

A fragile security situation, poor infrastructure, an arbitrary taxation system, and unevenly enforced and poorly planned regulations negatively affect the business environment. Enforcement of the labor code is rare. The economic downturn in 2020 further limited any effort by the government to reform its heavily subsidized, inefficient, and loss-making state-owned SNEL (Société Nationale d’Électricité) power utility.

Open Markets

The Democratic Republic of the Congo has one preferential trade agreement in force, and its simple average tariff rate is 8.5 percent. One formal nontariff measure is in effect, but other barriers to dynamic trade flows persist. Poor economic management aggravated by repeated political crises has severely constrained domestic and foreign investment. Companies have very limited access to financial services.

Country's Score Over Time

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Regional Ranking

RANK COUNTRY OVERALL CHANGE
1Mauritius70.9-6.1
2Cabo Verde66.72.9
3Botswana64.8-2.8
4Côte d'Ivoire61.6-0.1
5Seychelles61.1-5.2
6Benin611.4
7São Tomé and Príncipe60.34.4
8Senegal602.0
9Ghana59.80.6
10Tanzania59.5-1.8
11Namibia59.2-3.4
12Madagascar58.91.2
13Burkina Faso58.31.8
14The Gambia58-0.8
15Togo57.2-0.3
16Rwanda57.1-11.2
17South Africa56.2-3.5
18Mali55.90.3
19Gabon55.8-2.3
20Mauritania55.3-0.8
21Djibouti55.3-0.9
22Niger54.9-2.4
23Nigeria54.4-4.3
24Uganda54.2-4.4
25Guinea54.2-2.3
26Malawi530.0
27Cameroon52.9-0.5
28Kenya52.6-2.3
29Angola52.6-1.6
30Sierra Leone520.3
31Eswatini51.4-3.7
32Mozambique51.3-0.3
33Comoros50.4-5.3
34Chad49.8-0.6
35Ethiopia49.6-2.1
36Zambia48.7-1.7
37Republic of Congo48.5-2.2
38Lesotho48.1-5.4
39Liberia47.9-1.3
40Democratic Republic of Congo47.6-1.4
41Equatorial Guinea47.2-2.0
42Guinea-Bissau46-8.9
43Central African Republic45.7-3.1
44Eritrea39.7-2.6
45Burundi39.4-10.5
46Zimbabwe33.1-6.4
47Sudan32-7.1
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