The finance Act bill submitted by honourable Calixte Nganongo, Minister of Finance and Budget, had been unanimously adopted with amendments on Wednesday January 17, following its first reading by the national assembly , and its second reading by the senate on Thursday, January 18, 2018 at Palais des Congres in Brazzaville

The State budget draft for 2018 has been set at the amount of  1.602 billion 619 million 295.029 CFA francs in terms of revenues and at 1.383 billion 619 million 295.029 F CFA in terms of expenditure. This results in a budget surplus of 219 billion CFA francs.   

As regard cash, the 2018 finance act forecasts a deficit of 778 billion 900 million CFA francs, a gap which needs to be filled ( 219 billion with internal funds or a budget surplus and 559 billion from external or international donors).

The finance act has been drafted on the basis of a macroeconomic framework concluded jointly with the IMF for the conclusion a three-year  economic and financial programme (2018-2020).

According to the Minister of Finance, "in 2018 the economic activity of the country will get away from recession (-2,8% in 2016 and -4,6% in 2017), by reaching 0,7%. This would result from the powerful upswing  of Moho North oil field, with an expected production of 100 barrels a day, while the growth of the non oil sector would remain negative during the year considered, with a rate estimated at -6,3% against     -9,2% in 2017 and -3,2% in 2016 ».

The member of government further said that in the field of  public finance, a cautious management of public expenditure and the economic growth spurt would have reflect on the budget, with an improvement of the primary balance of the non oil sector , which would be -6.4% of the GGP against -23.4 in 2017 and -24% a year before.       " The primary balance  would be positive after more than four years of deficit and be 7.1% of the overall GDP", he said.

Main aims of the finance act bill

The finance act bill for 2018  aims at : reducing the primary deficit of the non oil sector; achieving fiscal discipline and rationalization of expenditure; improving excise departments performance ; mastering of indebtedness and firm management  of the debt policy; finally, strengthening of the financial system.

Budget resources estimates

Budget estimates amount to 1, 522 billion 629 million CFA francs against 1, 243  billion 300 million in 2017, an increase of 279 billion 329 million, i.e. a percentage of 22.47%. With a decrease of 31 billion 66 million CFA francs, tax revenues estimates amount to 737 billion 934 million CFA francs against 769 billion in 2017. They are as follows:

- internal taxes : 621 billion 434 million CFA francs against 653 billion  CFA francs, a drop of 31 billion 566 million CFA francs;

- customs duties and taxes : 116 billion 500 million CFA francs, almost at the same level as in 2017 (116 billion CFA francs).

Gifts, bequests and support funds are estimated at 29 billion 200 million CFA francs, a drop of 15 billion 800 million (-35.11%) in comparison with 2017 estimates which amounted to 45 billion CFA francs.

Oil revenues amount to 749 billion 200 million CFA francs ( 741 billion 200 million for the sale of cargoes and a bonus of 8 billion), against 391 billion 300 million CFA francs in 2017, which represents an increase of 357 billion 900 million, based on the following hypothesis :

Production set at 117 million barrels;

price of the Congolese crude oil set at 60 dollars with a haircut of 2.5 dollars;

exchange rate set at 566.7 CFA francs for one US dollar.

Administrative fees now fall at 2.995 billion CFA francs, against 12 billion in 2017, which represents a drop of 9 billion 5 million CFA francs. The new finance act contain measures to improve the collection of administrative fees.

Loan interests are estimated at 3 billion 300 million CFA francs  against 11 billion in 2017, which is a drop of 7 billion 700 million CFA francs.

Budget expenditure estimates   

Operating expenditure amount to 1.303 billion 629 million CFA francs for 2018 against 1498 billion 537 million CFA francs in 2017, which is a drop of 194 billion 908 million CFA francs (-13.01%), as a consequence of the reduction of the style of living of the State which started since the beginning of the crisis in 2014.

The financial cost of the debt amount to 146 billion CFA francs against 89 billion in 2017, which is an increase of 57 billion CFA francs (+64.04%) resulting from the increase of the debt stock.

Expenditure relating to staff is expected to drop at 45 billion 500 million CFA francs. They rise from 364 billion 500 million CFA francs to 410 billion in 2017, due to a better mastering of the number of civil servants and of some aspects relating to salaries.

Goods and services expenditure rises from 172  billion 300 million CFA francs, against 205 billion for the previous year, which is a drop of 32 billion 700 million CFA francs (-15.95%).

Transfer expenditure have increased slightly from 322 billion CFA francs in 2017 to 322 billion 829 million CFA francs in 2018.

The other spending (old common costs) amounts to 34 billion CFA francs in 2018, almost at the same level as the previous year (35 billion).

Supplementary budgets amount to 11 billion 761 million CFA francs in terms of revenues and expenditure, against 3 billion 811 million CFA francs in 2017, which is an increase of 7 billion 950 million CFA francs resulting from the taking into account of some public administrations which are not corporate bodies and  get paid for services delivered.

Treasury special accounts amount to 68 billion 229 million CFA francs in terms of revenues and expenditure, against 10 billion 937 million CFA francs in 2017, which is a  very big increase of 57 billion 292 million CFA francs. They take into account social security taxes under article 13 of the organic law relating to the finance acts.

Investment expenditure

They drop at 264 billion CFA francs (131 billion 600 million CFA francs of which represent freely attributable funds and 134 billion 400 million are  external resources), against 437 billion 537 million CFA francs in 2017. The reduction aims at alleviating the impact of investment expenditure on the level of indebtedness and that of currency reserve expressed as import months. A particular stress will be laid on the development of food-producing sectors (cassava and banana) and commercial one (cocoa), which represents 5 billion CFA francs.

It has to be noted that members of parliament suggested that, as regard new expenditure, the 2018 budget take into account the cost relating to the status of leader of the opposition (up to the amount of 1 billion  CFA francs) and the assistance of the displaced people of Pool for the same amount.

 Press department of the du Ministry of  Finance