By Franz Wild
Sept. 11 (Bloomberg) -- The Democratic Republic of Congo’s foreign currency reserves soared to their highest level in at least 18 years after the International Monetary Fund gave the country $500 million as part of a worldwide liquidity injection.
The funds, in the form of special drawing rights, lifted the central African nation’s reserves to $890 million, said Central Bank of Congo’s Foreign Markets Director Deo Mutombo.
“Since I joined the bank in 1991, we’ve never had this much in reserves,” Mutombo said today in an interview in the capital, Kinshasa. “I don’t think we’ve had this since 1980. This will mainly help us with our balance of payments.”
The IMF pumped $250 billion into foreign-exchange reserves worldwide on Aug. 28 to help boost global liquidity. Countries can convert the money, which is given in the form of SDRs, an IMF unit of account, into dollars and other hard currencies. Another allocation of about $33 billion was made on Sept. 9, the IMF said.
Congo has been struggling to stick to its budget as the global economic slump erodes its export earnings, which consist mainly of metals such as copper and cobalt. President Joseph Kabila hopes to rebuild a country the size of Western Europe, which has been left without road connections between major cities after two civil wars and decades of misrule.
The government last month implemented a treasury plan, to stop overspending, Mutombo said.
“From May there was too much spending, given the revenue we were getting,” Mutombo said. “We are now following a treasury plan, which is in line with our income.”
To contact the reporter on this story: Franz Wild in Kinshasa via Johannesburg at pmrichardson@bloomberg.net.
Last Updated: September 11, 2009 06:18 EDT
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