Aid freeze narrows Central African Republic’s budget room
By the AFREEQUE newsroom, based on Corbeau News Centrafrique
Illustrative image · Pavel Danilyuk · Pexels · Licence PexelsThe frozen programme with the International Monetary Fund and falling external funding are reducing resources available to the Central African budget. Increased borrowing comes as debt and public costs limit the state’s ability to fund essential spending, Corbeau News Centrafrique reports.
The freeze on external support, mounting debt and rising public costs are reducing the Central African state’s financial room for manoeuvre, according to Corbeau News Centrafrique. The suspension of the programme with the International Monetary Fund is depriving the Treasury of a source of funding, while the budget remains heavily dependent on external partners.
Falling external resources are forcing Bangui to borrow more to meet its commitments. Principal repayments and interest payments reduce the funds available for day-to-day spending, while the gradual withdrawal of some international missions is transferring new costs to the state, according to Corbeau News Centrafrique.
This pressure comes after financial demands attributed to the Kremlin and Wagner, the Russian paramilitary group, amid limited public revenues. The decline in revenues linked to diamond, gold and timber smuggling, denounced by Fidèle Gouandjika, an adviser to the Central African president, is adding pressure to public finances, according to information reported on 21 October.
