# Synopsis

Upgrading infrastructure plays a critical role in the Republic of Congo’s quest to diversify its economy and reduce poverty. It is also an important source of growth on its own. A cross-country statistical analysis conducted for this report shows that infrastructure contributed one-half of one percentage point to the Republic of Congo’s per capita GDP growth annually from 2001 to 2006. However, if the country’s infrastructure could be improved to the level seen in Mauritius, the leading country in Sub-Saharan Africa, it could contribute more than 3 percentage points to annual per capita growth.

The Republic of Congo’s power infrastructure is inadequate and inefficiently operated. The country lags well behind peer countries in generation capacity and electrification. The parts of the population not served by the grid face exorbitant costs. The government has responded to these issues with an ambitious investment plan. However, if new assets are to operate effectively, major inefficiencies in the power utility will also need to be addressed. The utility’s transmission and distribution losses are 47 percent, more than double best-practice benchmarks, while the cost of overstaffing is 30 percent of utility revenue. Tariffs recover barely half the cost of service provision, even though full cost recovery would be affordable to the population.

In the ICT sector, the Republic of Congo has made good progress in developing its mobile telephony market in recent years, with high levels of signal coverage. The cost of international connectivity is currently high, but it should fall once the country connects to the international submarine cable and completes its domestic fiber optic network. On the other hand, the physically dilapidated and financially depleted condition of the fixed-line telephone operator is becoming a constraint to raising Internet penetration.

Restoring the national transport network will require major investment and careful policy decisions in the port, road, rail, and river transport sectors. Following the approval of the National Transport Plan, major road sector investments are underway to restore connections between Pointe-Noire, Brazzaville, and the north of the country. A road fund has also been established to provide for maintenance, although so far resources have not been adequate. Significant performance improvements are needed at the PointeNoire port and on the CFCO rail link if the competitiveness of that corridor is to be restored. Constructing a bridge linking Brazzaville to Kinshasa would help to increase traffic through Pointe-Noire and improve overall route viability. Improving navigability on the Congo-Oubangui-Sangha rivers would also help to restore a highly cost-effective transport mode of strategic significance to the north of the country.

The Republic of Congo performs relatively well on service coverage in the water and sanitation sector. The country’s access statistics are substantially ahead of those in its peer group, particularly with regard to piped water, standposts, and improved latrines. However, access to services is much greater in urban areas than in rural areas. Furthermore, underpricing of water has hurt the financial soundness of the water utility, even though analysis suggests that cost recovery tariffs would be affordable to consumers.

The Republic of Congo needs to spend $0.95 billion per year through 2015 to catch up on infrastructure quantity and quality. This is equivalent to 16 percent of GDP, comparable to the share