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UPDATE 1-Congo revises 2017 GDP growth forecast to 3.5 pct from 4.9 pct
May 26, 2017 / 8:00 PM / 3 months ago

UPDATE 1-Congo revises 2017 GDP growth forecast to 3.5 pct from 4.9 pct

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KINSHASA, May 26 (Reuters) - Democratic Republic of Congo on Friday revised its forecast for 2017 gross domestic product growth downward to 3.5 percent from 4.9 percent previously, a government spokesman said.

Congo's oil and mining sectors account for over 95 percent of export revenues. It is Africa's top copper producer and also mines significant quantities of gold, cobalt, diamonds and tin, but its economy has been hit by a decline in commodity prices.

The government outlined a 2017 budget of $7.9 billion, up 10.6 percent on 2016 despite warnings from economists that spending cuts are one of the government's last remaining tools to control depreciation of the franc and spiralling inflation.

The government said it expects the franc to stand at 1,689 to the dollar at year end compared to 1,430 currently. The franc has lost half its value since last year, largely due to low oil and mineral prices.

In March, the International Monetary Fund said the government should prioritise reducing its budget deficit in order to stabilise the exchange rate and reduce inflation.

Former Prime Minister Augustin Matata Ponyo tabled a roughly $5 billion budget last October but he was replaced before parliament examined it. Public expenditures this year have so far been financed by stopgap funding measures.

$1 = 1,430 Congolese francs Reporting by Aaron Ross; Writing by Matthew Mpoke Bigg; Editing by Mark Heinrich

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