Congo’s Oil Windfall Opens a Window to Reduce Arrears and Build Lasting Fiscal Strength

Cheick F. Kanté, World Bank Division Director for the Republic of Congo, said the current oil windfall creates a critical period for tackling arrears and strengthening debt management.

The Republic of Congo has an opportunity to use higher oil revenues to address unpaid government obligations and build a stronger foundation for growth that reduces poverty. The World Bank Group's newly launched 13th Republic of Congo Economic Update examines how the country can turn a temporary revenue boost into lasting improvements in public finances. Titled Breaking the Debt Cycle: From Arrears to Fiscal Resilience, the report connects better debt management with greater economic stability and opportunities for Congolese citizens.

Economic growth is projected to reach 4.4% in 2026, supported by higher oil prices that are expected to improve the government's financial position. The fiscal balance is forecast to increase from 0.6% of gross domestic product in 2025 to 3.7% in 2026, giving the country more room to address financial pressures. Inflation is projected to rise to 3.8%, adding another consideration for policymakers managing the benefits of increased oil income.

The outlook becomes less favorable as oil prices gradually normalize during 2027–2028, with economic growth projected to slow to an average of 3.7%. The fiscal balance is expected to decline to 2.3% of GDP, accompanied by an easing of inflation. These projections underline the importance of using the current revenue boost to address weaknesses that could leave the country exposed when oil earnings fall.

Using oil revenues to break the arrears cycle

The report examines recent economic developments and the medium-term outlook, giving particular attention to the country's changing debt position and accumulation of arrears. Clearing overdue government payments and preventing new ones would help Congo move away from recurring financial pressures that weaken economic stability. Stronger public financial management would give the country a better foundation for managing revenue changes and supporting growth beyond the oil sector.

Rick Tsouck Ibounde, World Bank Lead Economist and co-author of the report, described the current oil revenues as an opportunity to build lasting fiscal resilience. He identified stronger management of public finances and economic diversification as priorities for breaking the cycle of arrears and financial vulnerability. His assessment places the emphasis on decisions that turn temporary income into improvements capable of supporting the economy after oil prices decline.

Paying overdue obligations can support businesses and jobs

Reducing outstanding arrears would help restore private sector confidence and ease the cash shortages businesses face when government payments remain overdue. More reliable payments could encourage investment and job creation, strengthening the foundations of a more resilient and diversified economy. These benefits would help connect improvements in government finances with broader opportunities for businesses and workers.

The report calls for stronger debt and cash-flow management, tighter fiscal discipline and reforms that prevent overdue obligations from building up again. Addressing existing unpaid bills needs to be accompanied by changes that keep future spending and payment commitments manageable. Failure to make meaningful progress could allow lower oil prices to expose underlying economic weaknesses and damage prospects for stronger growth that reaches more people.

Building public finances that can withstand future shocks

Cheick F. Kanté, World Bank Division Director for the Republic of Congo, said the current oil windfall creates a critical period for tackling arrears and strengthening debt management. He stressed that better fiscal discipline could help the country move from recurring vulnerability toward greater resilience. The reforms undertaken during this period, he explained, will shape Congo's ability to withstand future shocks and deliver sustainable growth for its citizens.

The report's roadmap centers on using today's favorable oil revenues to strengthen the country's finances and support a more diversified economy. Progress would reduce vulnerability to changing oil prices and create a stronger basis for inclusive, poverty-reducing growth. The opportunity rests on translating temporary financial gains into lasting improvements in how Congo manages debt, meets payment obligations and supports economic activity.