From Africa Recovery, Vol.11#3 (February 1998), page 4

Donors begin to aid the new Congo

Democratic Republic presents an emergency recovery plan for 1998

By Carole J.L. Collins

A World Bank-convened "Friends of Congo" meeting in Brussels on 4 December discussed the most pressing reconstruction and development needs of the Democratic Republic of Congo (DRC, ex-Zaire). Most of the representatives from

17 donor governments and nine bilateral and multilateral agencies responded with cautious optimism to then Congolese Finance Minister (now Agriculture Minister) Mawampanga Mwana Nanga's presentation on a proposed $1.68 bn emergency "Economic Stabilization and Recovery Programme" for 1998 for the resource-rich yet financially destitute Central African nation. But many remain concerned (see box below) over perceived efforts to obstruct a UN team investigating allegations that Rwandese refugees were massacred last year by advancing troops of DRC President Laurent Désiré Kabila's Alliance of Democratic Forces for the Liberation of Congo (ADFL).

The Brussels gathering followed a meeting on 5 September in Paris at which the World Bank first offered its technical assistance to the DRC to help develop a long-term reconstruction plan, an offer it renewed on 4 December. While not organized as a pledging conference, several key initiatives were launched at the meeting:

-- Several donors agreed to help establish a "Friends of Congo" Trust Fund, modelled on those organized for the Gaza Strip and Bosnia-Herzegovina. A steering committee chaired by Sweden and assisted by a World Bank-provided technical secretariat met in mid-January to design the Fund.

-- Participants agreed to explore "imaginative" ways to ease the DRC's $14.6 bn foreign debt, though no immediate write-off was agreed. DRC officials conceded Congo's legal responsibility to repay old loans but asked that donors consider writing off loans shown to have been stolen or squandered -- and thus never utilized for their stated development purposes -- by the regime of the late dictator Mobutu Sese Seko.

-- A working group on capacity-building chaired by the UN Development Programme is to be established to help joint donor-DRC efforts to strengthen economic management institutions.

A few donors moved immediately to begin unblocking bilateral aid, which had been largely frozen after 1991 as Mr. Mobutu continued

to undermine democratization efforts. The European Union (EU) announced it would disburse some $87 mn (of an estimated $265 mn blocked since 1992) to help meet health needs and rebuild two roads connecting Congo's capital, Kinshasa, to Kikwit and Matadi port. Both roads are vital for ensuring sufficient food for Kinshasa's almost 4 million people. The EU also indicated it would commit $33 mn towards a voters' census for national elections expected to be held in 1999.

Belgium followed the EU lead, promising $20 mn for health, education and food security. However, it condemned alleged government obstruction of the UN human rights investigation and detention of a Belgian national heading the Belgian-South African Sizarail company nationalized by the ADFL during its military advance.

On 9 December, US Secretary of State Madeleine Albright, in a speech in Addis Ababa to the Organization of African Unity, pledged $10 mn to the future Trust Fund. During her

12 December visit to Kinshasa she also promised to ask the US Congress for $35-40 mn in additional aid for fiscal year 1998. The US already released about $8 mn between June and end-1997 to help fund a UNICEF-organized vaccination drive and several small projects run by non-governmental organizations (NGO), as USAID set up outpost offices in Kananga, Lubumbashi and Bukavu.

The meeting's convenor, World Bank Vice-President for Eastern and Southern Africa Callisto Madavo, praised the DRC presentation for providing "a rough road map" of the country's most urgent needs. But the DRC received few answers to how it will bridge the emergency plan's almost $1.12 bn financing gap, and many question if it will be able to raise the $564.5 mn it expects to garner internally to fund the plan.

The plan seeks $440.5 mn for "political and macroeconomic stabilization" (including paying salaries, computerization, and demobilizing or retraining military and state officials); $945.5 mn for economic recovery (including $494 mn for upgrading transport and roads, $101.5 mn for agriculture, and $350 mn for energy); and $296.3 mn towards "reversing the deterioration of human capital," including in health, education and capacity-building.

While DRC policy on privatization is still evolving, the plan strongly endorsed "liberalization of the [mining] sector and promotion of private investment," as well as removal of regulations limiting investment, encouragement of greater competition, actions to reduce smuggling, and moves to turn its major mining parastatals into state holding companies.

But donors will assess "progress in the areas of governance [and] democratization," as well as "implementation of reconstruction and recovery measures, and the preparation and execution of a broader economic programme" at a planned follow-up meeting in mid-1998, noted a World Bank press release.

The new Congo government faces a daunting economic legacy from Mr. Mobutu's three decades of misrule. When the ADFL seized power in May 1997, it found government coffers and bank accounts stripped of money and precious gems, stolen in the weeks preceding the fall of Kinshasa. Many of the DRC's new cabinet ministers responsible for economic matters also lack experience, and inter-ministry coordination on economic policies has proved difficult.

Progress and setbacks

The new government has largely succeeded in reining in inflation, cutting some corruption, and attracting interest in the mining sector (though many potential investors have since become concerned at government moves in January to renegotiate signed contracts). While economic output may grow by almost 1 per cent in 1997, people's dire poverty has severely limited the use of taxes to pay government salaries, fueling a recurrence of the bribe-soliciting and other forms of corruption Mr. Kabila has actively sought to end.

Many of Congo's dynamic civil society groups are frustrated by their exclusion from the government's initial work on its reconstruction plans. Many participated enthusiastically in province-level reconstruction conferences the government held during December-January, but a concluding national conference originally scheduled for late January was postponed without explanation.

Congo also has progressed on drafting a new constitution, drawing from both the 1964 constitution and that proposed by the Sovereign National Conference, a broad-based 2,000-member body which led efforts to democratize the country in the early 1990s. The draft, expected to be ready by early 1998, would then be taken to regions for some form of public discussion before being voted on.

The Brussels meeting took place amid renewed efforts to track down Mr. Mobutu's stolen wealth. On 8 December, a five-member Belgian legal and police team arrived in Kinshasa to investigate allegations of past Mobutist money-laundering in Belgium and assess evidence to justify a continued freeze of Mobutu-linked assets. In late 1997, the Swiss government also ordered banks there to broaden and deepen their efforts to identify bank accounts belonging to Mr. Mobutu, his family and close associates.

The DRC is actively reaching out to its neighbours seeking regional solutions to their economic problems. In July, Foreign Minister Bizima Karaha told audiences in Washington of plans to build a transport grid that would directly link East and West Africa for the first time. In September, President Kabila signed an agreement with Rwanda to build a Gisenyi-Kisangani railway, part of a broader effort by the DRC, Uganda and Rwanda to upgrade transport links between the three countries. In October the DRC became the newest member of the Southern African Development Community (SADC), many of whose members look with interest toward the DRC's immense water supply and hydro-electric potential, as well as its vast mineral and agricultural resources. The new Congo also plans to join the Common Market for Eastern and Southern Africa (COMESA).

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BOX 1:

Aid conditioned on human rights inquiry

An acrimonious human rights dispute with the UN and questions about the DRC government's commitment to democracy have caused many donors to adopt a "wait and see" approach to restarting development aid.

From mid-August until late November a UN team of forensic experts -- appointed by UN Secretary-General Kofi Annan to replace an earlier UN Commission on Human Rights inquiry opposed by President Laurent Kabila -- tried without success to arrange to travel outside Kinshasa to sites of alleged massacres and other abuses of Rwandan refugees and Congolese civilians during the ADFL advance. (Such abuses had been reported by international human rights organizations, including Human Rights Watch, Amnesty International and Médécins sans frontières, as well as by Congolese human rights groups.) The 4 December donors' meeting itself remained in doubt until after US Ambassador to the UN Bill Richardson reached a late October agreement with President Kabila allowing the UN inquiry access to all regions of Congo. By early February, UN investigators, delayed by continuing differences with the government over security issues (and by floods), had yet to start their inquires at Mbandaka.

While most donors are willing to back Congolese NGO projects, many believe aid commitments to the government should depend on the progress or outcome of the UN inquiry, which the Secretary-General has scheduled for completion by end-May. But many African leaders -- including Ugandan President Yoweri Museveni and South African President Nelson Mandela -- view this stance as unfair, since Western countries had rarely tried to curb Mr. Mobutu's earlier human rights abuses. They also argue that withholding aid damages President Kabila's efforts to rebuild government capacity and holds the Congolese people's development needs hostage to Western human rights concerns. In October, Oxfam International urged donors to grant substantial levels of new aid and debt relief to the DRC while working to foster greater respect for human rights by all governments in the Central African region.

-- Carole J.L. Collins

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