2018 Index of Economic Freedom

Republic of Congo

overall score38.9
world rank177
Rule of Law

Property Rights32.4

Government Integrity24.6

Judicial Effectiveness28.2

Government Size

Government Spending33.4

Tax Burden60.8

Fiscal Health6.2

Regulatory Efficiency

Business Freedom31.3

Labor Freedom34.1

Monetary Freedom73.8

Open Markets

Trade Freedom61.9

Investment Freedom50.0

Financial Freedom30.0

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Quick Facts
  • Population:
    • 4.5 million
  • GDP (PPP):
    • $29.8 billion
    • 2.5% growth
    • 2.8% 5-year compound annual growth
    • $6,676 per capita
  • Unemployment:
    • 11.2%
  • Inflation (CPI):
    • 3.6%
  • FDI Inflow:
    • $2.0 billion
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The Republic of Congo’s economic freedom score is 38.9, making its economy the 177th freest in the 2018 Index. Its overall score has decreased by 1.1 points, with declines in scores for the tax burden, government integrity, and fiscal health indicators overwhelming a substantial improvement in trade freedom. The Republic of Congo is ranked last among 47 countries in the Sub-Saharan Africa region, and its overall score is well below the regional and world averages.

Repressive governance continues to deprive the Congolese people of economic freedom. The authoritarian socialist government could not furnish basic public goods and infrastructure during the commodity boom. Now lower oil prices have left it weakened by a severe financial crunch. The weak judiciary undermines the protection of property rights and fuels corruption. Many are trapped in subsistence-level poverty. The large informal economy provides most of Congo’s limited private-sector growth.

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Background

The Republic of Congo became independent from France in 1960. Denis Sassou-Nguesso seized power in 1979 and ruled until allowing a multiparty election, which he lost, in 1992. He seized power again following a 1997 civil war and then won flawed elections in 2002, 2009, and 2016. A referendum approved in 2015 modified the constitutional limits on a president’s age and the number of terms he could serve, allowing the 74-year-old Sassou-Nguesso to run again. One of sub-Saharan Africa’s largest oil producers, Congo lacks infrastructure to exploit its natural gas reserves and hydropower potential. China plans to build a special economic zone in the port city of Pointe-Noire, from where the government also plans to build an oil pipeline to the north.

Rule of LawView Methodology

Property Rights 32.4 Create a Graph using this measurement

Government Integrity 24.6 Create a Graph using this measurement

Judicial Effectiveness 28.2 Create a Graph using this measurement

The codified process for acquisition and retention of real property is not always followed, and there are widespread complaints against the government’s administration of real property transactions. The judiciary is underfunded and crippled by institutional weakness and a lack of technical capability. Corruption remains pervasive. The state-owned oil company is directly controlled by the president’s family.

Government SizeView Methodology

The top individual income tax rate is 45 percent. The top corporate rate is 34 percent. Other taxes include a value-added tax and a tax on rental values. The overall tax burden equals 27.2 percent of total domestic income. Over the past three years, government spending has amounted to 47.1 percent of total output (GDP), and budget deficits have averaged 14.5 percent of GDP. Public debt is equivalent to 83.0 percent of GDP.

Regulatory EfficiencyView Methodology

Significant challenges to running a business include rudimentary access to the Internet and inconsistent electric and water supplies. Education standards are low, and there is little social mobility. The majority of Congo’s workers are employed in the informal sector. The inefficient state-owned electricity utility is heavily subsidized, but rates for mining companies and consumers are still high.

Open MarketsView Methodology

Trade is extremely important to the Republic of Congo’s economy; the combined value of exports and imports equals 137 percent of GDP. The average applied tariff rate is 11.6 percent. Nontariff barriers impede trade. Government openness to foreign investment is below average. The underdeveloped financial system remains dominated by banks. Although the number of banks has grown, financial intermediation is low.

Country's Score Over Time

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Regional Ranking

rank country overall change
1Mauritius75.10.4
2Botswana69.9-0.2
3Rwanda69.11.5
4South Africa630.7
5Uganda621.1
6Côte d'Ivoire 62-1.0
7Seychelles61.6-0.2
8Burkina Faso600.4
9Cabo Verde603.1
10Tanzania59.91.3
11Namibia58.5-4.0
12Nigeria58.51.4
13Gabon58-0.6
14Mali57.6-1.0
15Guinea-Bissau56.90.8
16Madagascar56.8-0.6
17Benin56.7-2.5
18Comoros56.20.4
19Ghana56-0.2
20Swaziland55.9-5.2
21Senegal55.7-0.2
22Kenya54.71.2
23Zambia54.3-1.5
24Mauritania54-0.4
25Lesotho53.90.0
26São Tomé and Príncipe 53.6-1.8
27Ethiopia52.80.1
28The Gambia52.3-1.1
29Guinea52.24.6
30Democratic Republic of Congo52.1-4.3
31Malawi52-0.2
32Cameroon51.90.1
33Sierra Leone51.8-0.8
34Burundi50.9-2.3
35Liberia50.91.8
36Niger49.5-1.3
37Sudan49.40.6
38Chad49.30.3
39Central African Republic49.2-2.6
40Angola48.60.1
41Togo47.8-5.4
42Mozambique 46.3-3.6
43Djibouti45.1-1.6
44Zimbabwe440.0
45Equatorial Guinea42-3.0
46Eritrea41.7-0.5
47Republic of Congo 38.9-1.1
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