Central African Republic faces financing test after fragile economic recovery

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Growth accelerated to 3.3% in 2025, but rising debt, external imbalances and persistent energy and security constraints threaten a $12.8 billion development plan.

BANGUI — The Central African Republic recorded a moderate economic recovery in 2025, supported by primary-sector activity and a rebound in investment. But transforming one of Africa’s most fragile economies will require considerably more than a return to positive growth.

Gross domestic product expanded by 3.3% in 2025, following growth of 1.8% in 2024 and just 0.7% in 2023, according to an African Development Bank country report released in Bangui on August 19. The lender expects growth to slow to 2.9% in 2026 before accelerating to 3.9% in 2027.

The outlook remains vulnerable to security conditions, unreliable energy supplies and delays in infrastructure projects spanning transport, power and agro-industry. Inflation is expected to remain above the regional target of 3%, limiting improvements in household purchasing power.

“The economic recovery observed in 2025, with real GDP growth of 3.3%, is encouraging,” said Marc Mandaba, minister for the economy, planning and international cooperation. “However, this recovery remains insufficient to meet the scale of our social needs, create enough jobs and sustainably improve the living conditions of our people.”

Public finances present a mixed picture. The overall budget deficit narrowed to 3.5% of GDP in 2025 from 5.1% in 2024. It is expected to remain at 3.5% in 2026 before declining to 3% in 2027.

Despite the fiscal consolidation, public debt increased to 59% of GDP from 58%, highlighting the government’s limited capacity to finance large-scale investment through additional borrowing.

The external position also remains fragile. The current-account deficit narrowed to 7.4% of GDP in 2025 from 9% a year earlier, but still leaves the economy exposed to fluctuations in export revenues, import costs and the availability of foreign financing.

The central challenge is funding the country’s 2024-2028 National Development Plan, whose financing requirements are estimated at $12.8 billion. The programme’s scale contrasts sharply with the state’s narrow fiscal base, making it unlikely that public resources and traditional development assistance alone will be sufficient.

Bangui is therefore seeking to mobilise domestic savings, diaspora funds, institutional investors, regional financing and private capital. Guarantees, blended-finance structures, local-currency instruments and risk-sharing mechanisms could reduce financing costs and make infrastructure projects more bankable.

The strategy forms part of the African Development Bank’s push for a new financial architecture capable of mobilising more of Africa’s institutional capital for development.

Yet private investors will demand predictability. Turning the Central African Republic’s agricultural, mineral and energy potential into productive investment will require stronger governance, more efficient public spending and lower operational risks linked to insecurity and chronic electricity shortages.

The 2025 recovery is therefore a starting point rather than a decisive turnaround. The real test is whether Bangui can convert three years of gradually strengthening growth into an economy capable of attracting capital, creating jobs and financing essential public services without pushing debt to unsustainable levels.