Collapse in oil revenues for Chad: IMF report

CHAD REFINERYChad's de Djermaya refinery, located 90km north of Ndjamena. (Image Credit: David Stanley/Flickr)Low oil prices and falling oil revenues have contributed to underperformance in the economy of Chad, according to a report by the International Monetary Fund (IMF)

Oil revenues have collapsed to a fraction of their previus level and are projected to only partly and gradually recover. Foreign direct investment in the oil sector will remain an important source of external funding for the country's hydrocarbons sector.

The external current account deficit grew from 9 per cent of GDP to an estimated 12.4 per cent of GDP in 2015 on account of the falling oil prices and a corresponding fall in exports. A gradual recovery of revenues from non-oil sectors, including agriculture, commerce and transportation, is expected between 2016 and 2018, reaching 4 per cent in the medium term. An expected rebound of oil revenues in this period will also help ease fiscal constraints.

Other factors that have impacted on Chad's economic outlook, according to the IMF, include disruptions to cross-border trade flows with Cameroon and Nigeria, regional security threats, repriortisation of defence spending and the hosting of refugees and internally displaced persons.

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