Tuesday 24 April 2018

Republic of Congo to cut costs over falling oil prices

Republic of Congo to cut costs over falling oil prices
(Xinhuanet 06/03/16)

BRAZZAVILLE, June 3 (Xinhua) -- Republic of Congo government has taken measures to cut expenses following a sharp drop in oil prices, the main source of revenue for the country, Government Spokesman Thierry Moungalla said Wednesday.

The government's wage bill has remained unchanged at 410.1 billion CFA Francs (about 700 million U.S. dollars), while current expenditure has reduced from 319.5 billion CFA Francs to 301.3 billion CFA Francs, a six percent reduction.

"This is to demonstrate the government's desire to cut its expenses," Moungalla said in reference to the reduction.

According to him, the situation is justified by the prevailing economic situation that is characterized by the drop in oil prices.

Whereas the Republic of Congo expected to earn 750 billion CFA Francs from oil sector in 2016, the country is now set to earn 544 billion CFA Francs only.

The situation has forced the government to reduce its 2016 budget by 10 percent from 2,333.3 billion CFA Francs to 2,121.5 billion CFA Francs.

Despite the difficult economic conditions as well as budget cuts, the Congolese government vowed to place emphasis on what it considers as the priority for achieving development and middle-income economy status.

To achieve this, President Denis Sassou Nguesso has emphasized the need for economic diversification to reduce excessive dependence on oil.

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