Chad 2021 Economic Update : Recovering from Shocks – Improving Macro-Fiscal Sustainability to Rebuild Better
The COVID-19 pandemic has significantly disrupted Chad’s economic recovery, which started in 2018. GDP contracted by 0.9 percent in 2020. Agriculture and the oil sector remained the main drivers of growth, contributing 1.1 percentage points, while...
| Main Authors: | , , |
|---|---|
| Format: | Report |
| Language: | English |
| Published: |
World Bank, Washington, DC
2021
|
| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/undefined/898361634761728026/Chad-2021-Economic-Update-Recovering-from-Shocks-Improving-Macro-Fiscal-Sustainability-to-Rebuild-Better http://hdl.handle.net/10986/36441 |
| Summary: | The COVID-19 pandemic has
significantly disrupted Chad’s economic recovery, which
started in 2018. GDP contracted by 0.9 percent in 2020.
Agriculture and the oil sector remained the main drivers of
growth, contributing 1.1 percentage points, while services
contracted (contributing -2.0 percent). The impact of
containment measures on domestic supply chains pushed up
prices, and inflation rose from -1.0 percent in 2019 to 3.5
percent in 2020. Both the fiscal and current account
balances deteriorated substantially, and difficulties in
financing fiscal deficit may have led to further domestic
arrears’ buildup. Given the lack of fiscal space and large
financing requirements, bold actions are needed. In this
regard, the government could first strengthen economic
diversification to enlarge the fiscal base, by removing
bottlenecks to livestock exports, adopting business-friendly
reform to support the private sector, and strengthening
fiscal administration and policy for better revenue
collection. Second, the government could improve its
spending efficiency to deliver quality service under
declining resources by enhancing the selection process, the
planning and designing of investment projects, and improving
public spending efficiency in health and education. Finally,
the government should improve debt sustainability by
strengthening its management and transparency. |
|---|