In attempt to increase foreign currency reserves, Democratic Republic of Congo ordered mining and oil firms to pay taxes and import duties in US dollars rather than in the national currency, the Central Bank of Congo said, Reuters reported. It reverses a policy established in 2014 to require companies to pay taxes in francs as part of a drive to wean the central African country off dollars. The policy shift comes amid slump in global mining and oil prices that have weakened government revenues.
The measure would enable the Bank to “get a grip on some of the currency supply” and allocate it rationally to the public and private sector, said Governor Deogratias Mutombo, CitizenTV reported.
Congo is Africa’s top producer of copper, and mining is a key to an economic boom that has seen growth rates of 8% for the past five years, which has been among the highest in the world, according to International Monetary Fund (IMF) figures.
Mining and oil companies contribute more than $2b per year to government revenue, according to the Extractive Industries Transparency Initiative, which sets a global standard for accountable management of natural resources.