IMF cuts Congo's 2009 growth forecast to 2.7 pct

By Joe Bavier

KINSHASA (Reuters) - The International Monetary Fund on Tuesday slashed its 2009 growth forecast for the Democratic Republic of Congo to 2.7 percent, down from a previous estimate of 4.4 percent and well below the 8 percent growth estimate for 2008.

The revisions are largely due to the fall in mining revenues and highlight the weakness of the economy in the Central African country that had looked to booming commodity prices to help it recover from years of war and chaos, officials said.

"For 2009, we've revised the projection concerning growth to a figure of 2.7 percent," Brian Ames, division chief in the IMF's Africa Department, told reporters on Tuesday during a visit to the country. The drop was largely due a major dip in revenues from mineral exports, he said.

Inflation, which was pegged at around 28 percent last year, is likely to average near 25 percent in 2009, Ames said.

The global economic slowdown and financial crisis have crippled Congo's mining-based economy as tumbling commodities prices have forced companies to scale down or suspend operations, strangling government revenues.

Late last year, the IMF cut its projection for 2009 direct foreign investment in Africa's third largest country to $800 million from a previous forecast of $2.5 billion.

Import-dependent Congo's foreign currency reserves had all but evaporated by early February, plunging from a 2008 high of around $270 million to just $30 million -- the equivalent of less than a week of imports.

Last week, the IMF disbursed nearly $200 million in assistance from its Exogenous Shocks Facility, which is designed to speed financing to countries hurt by the worldwide slump.