Bangui — The World Bank’s Central African Republic Economic Update (8th edition, June 2025) paints a picture of an economy that edged forward in 2024, even as poverty remained entrenched and fiscal buffers thinned. The report’s core message is pragmatic: CAR can turn a modest cyclical stabilisation into durable progress only if it converts its abundant natural wealth—especially forests and gold—into human and produced capital, while fixing energy bottlenecks and tightening public finance management.
Where the economy stands
Real GDP growth picked up to about 1.5% in 2024 from 0.7% in 2023, helped late in the year by improved electricity and fuel supply and a rebound in agro-processing and trade. Inflation averaged a low 1.5%—below the CEMAC 3% convergence bar—though it ticked up at year-end as consumption recovered alongside energy availability. Fiscal space, however, remained tight: domestic revenue rose to roughly 9.2% of GDP, yet social and discretionary outlays pushed the overall deficit wider, while the current account deficit hovered near 9% of GDP, buffered by aid inflows. The baseline outlook sees growth gradually rising toward 2.8% by 2027, conditional on energy reforms, logistics upgrades, and steady concessional financing.
Poverty and fragility remain binding constraints
Around two-thirds of Central Africans—about 65%—lived in extreme poverty in 2024, with a stark urban–rural divide and persistent food insecurity. A fragile security environment, recurrent fuel shortages, and climate shocks compound vulnerabilities; large numbers of displaced people and refugees underscore how quickly economic gains can be undone. The policy implication is clear: any growth strategy must be paired with targeted safety nets and service delivery that reach well beyond Bangui.
The wealth lens: abundant assets, underperforming outcomes
The report’s special theme reframes CAR’s prospects through a multidimensional wealth lens. Total national wealth rose from about US$24.4 billion in 1995 to US$28.1 billion in 2020—yet wealth per person fell, as gains could not keep pace with population growth. Natural capital dominates the balance sheet, accounting for roughly 72% of total wealth(excluding carbon retention services), with produced capital around 15% and human capital about 13%. Importantly, recognising the forests’ carbon retention services adds c. US$10.6 billion to wealth in 2020—lifting the total to ~US$38.7 billion—highlighting both the global public-good value of CAR’s forests and the challenge of monetising that value sustainably.
Turning assets into prosperity: a three-track agenda
1) Make forests pay—without cutting them down. The report calls for valuing ecosystem services (carbon, water, biodiversity) and enforcing conservation in dedicated areas, while moving decisively into domestic wood transformation ahead of CEMAC’s 2028 log-export ban. The prize is jobs and value-added from sawnwood and downstream products, with the side benefit of stabilising local micro-climates, supporting food security, and reducing health risks from traditional biomass use if clean-cooking adoption accelerates.
2) Lean into gold; be realistic on diamonds. Under the 2024 mining code, carefully regulated artisanal and small-scale gold production could deliver quicker export and revenue gains than capital-intensive projects—especially in relatively more stable western zones. Tighter price-tracking and anti-smuggling enforcement are essential to keep value onshore. Diamonds, even after the 2024 lifting of Kimberley Process restrictions, face headwinds from synthetics; policy effort should focus where fiscal yield per enforcement dollar is highest.
3) Build the bridges from natural to human/produced capital. The report’s virtuous-circle logic is explicit: reinvest natural-resource rents into power, roads, and people. Energy reliability is the immediate unlock for agro-processing—the near-term diversification path with the best employment and value-added potential—while sustained health and education investments raise human-capital wealth over time. A credible PFM agenda that prioritises transparency, arrears reduction, and tax-expenditure discipline will determine whether new resources translate into better services and trust.
Execution risks—and how to mitigate them
The update is frank about risks: fuel and electricity bottlenecks; security slippage around elections; delayed concessional finance; climate shocks; and regional conflict spillovers. At the operational level, two risks loom largest. First, implementation capacity—from forest governance and log-processing readiness to gold-sector oversight and customs controls—must be strengthened to avoid leakage and policy drift. Second, inclusivity—benefits must reach communities beyond Bangui through targeted safety nets and local service delivery; otherwise, legitimacy erodes and informality persists. The report’s blueprint points to mitigation: protect priority social spending, publish tax-expenditure and natural-resource revenue data, and scale programmes that connect households to productivity (inputs, extension, skills) as infrastructure rolls out.
Bottom line
CAR’s balance sheet is rich; its income statement is not. The Economic Update argues that the country can finance a fairer recovery by converting forest and mineral wealth into steady, rules-based revenues—and then recycling those proceedsinto electricity, logistics, education, and health. Measured against that yardstick, success over 2025–2027 will be less about headline growth and more about three tests: reliable power in growth hubs, visible service gains outside the capital, and rising domestic revenue that comes from base-broadening rather than ad-hoc exemptions. If those needles move, the country’s multidimensional wealth can finally start compounding for its people.
Source: World Bank, Central African Republic Economic Update—8th Edition: “Optimizing CAR’s Multidimensional Wealth for Sustainable Prosperity” (June 2025).
