ed external debt, and has resulted in
the deaths from war, famine, and disease of perhaps 3.5 million
people. Foreign businesses have curtailed operations due to
uncertainty about the outcome of the conflict, lack of
infrastructure, and the difficult operating environment. The war has
intensified the impact of such basic problems as an uncertain legal
framework, corruption, inflation, and lack of openness in government
economic policy and financial operations. Conditions improved in
late 2002 with the withdrawal of a large portion of the invading
foreign troops. Several IMF and World Bank missions have met with
the government to help it develop a coherent economic plan, and
President KABILA has begun implementing reforms. Much economic
activity lies outside the GDP data. Economic stability, aided by
international donors, improved in 2003. New mining contracts have
been approved, which - combined with high mineral and metal prices -
could improve Kinshasa's fiscal position and GDP growth.

Congo, Republic of the
The economy is a mixture of village
agriculture and handicrafts, an industrial sector based largely on
oil, support services, and a government characterized by budget
problems and overstaffing. Oil has supplanted forestry as the
mainstay of the economy, providing a major share of government
revenues and exports. In the early 1980s, rapidly rising oil
revenues enabled the government to finance large-scale development
projects with GDP growth averaging 5% annually, one of the highest
rates in Africa. The government has mortgaged a substantial portion
of its oil earnings, contributing to a shortage of revenues. The 12
January 1994 devaluation of Franc Zone currencies by 50% resulted in
inflation of 61% in 1994, but inflation has subsided since. Economic
reform efforts continued with the support of international
organizations, notably the World Bank and the IMF. The reform
program came to a halt in June 1997 when civil war erupted. Denis
SASSOU-NGUESSO, who returned to power when the war ended in October
1997, publicly expressed interest in moving forward on economic
reforms and privatization and in renewing cooperation with
international financial institutions. However, economic progress was
badly hurt by slumping oil prices and the resumption of armed
conflict in December 1998, which worsened the republic's budget
deficit. The current admin