AfDB approves US $22.5-million to improve investment climate and forest governance in Congo

Abidjan, Cote d’Ivoire (Capital Markets in Africa) — The Board of Directors of the African Development Bank Group (AfDB) on Wednesday, July 1, 2015 approved a US $22.5-million loan to the Republic of Congo to help finance the country’s Investment Climate and Forest Governance Support Project (PACIGOF).

The project aims to promote robust and inclusive growth by improving the business climate and diversifying the Congolese economy. It will strengthen the capacity of private sector support institutions and promote private initiative; as well as improve forest/timber sector governance.

PACIGOF activities will involve government departments in Brazzaville, but also offices of the economic ministry in Pointe-Noire as well as Ministry of Forest Economy and Sustainable Development’s devolved structures in the hinterland. The project’s main beneficiaries are: (i) the Congolese State, in terms of institutional capacity building for structures tasked with promoting SMEs, improving the investment climate and managing the forest/timber sector; and (ii) businesses, particularly women’s SMEs and micro-enterprises that will operate in a more favourable institutional environment. Generally, the better service quality induced by the project will benefit all Congolese – the prime beneficiaries of jobs created, especially through more effective forest/timber sector governance and higher private investment.

On completion, this project is expected to deliver: (i) a renovated national strategic SME framework; (ii) significant improvement in the legal and regulatory framework applicable to SMEs; (iii) the strengthening of private sector support structures, particularly the one-stop shop and an operational Trades Chamber; (iv) an increasingly diversified production base thanks to the establishment of incubators and nurseries, and the development of women entrepreneurship; (v) the reorganization of the “forestry/timber” sub-sector, effective rehabilitation of Ministry of Forest Economy and Sustainable Development; (vi) the revitalization of the sector’s production base thanks to higher investments and a greater contribution of the sector to the national budget

The entire country will benefit from this project, especially private sector support institutions, sector ministries and the private sector whose capacity will be built and resources increased. Civil society organizations will benefit from capacity-building in sustainable forest management, and women’s associations involved in economic activities will benefit from the establishment of the women entrepreneurship centre.

Estimated at US $45 million (about CFAF 24.64 billion at the March 2015 exchange rate), the AfDB loan represents half of the total cost while the government will provide the remaining half in counterpart funding.