Congo's government-run companies are bleeding money: the World Bank says sell them off

The solution to a state that can't run critical infrastructure competently is to hand that infrastructure to foreign companies or local oligarchs, who may run it better but will almost certainly run it for themselves. The citizens who suffered the bad service now get to watch someone else profit from the good service.

What happened

The Democratic Republic of Congo is trying to sell its state-owned companies. This report lays out how they might do it. It means these companies could become private businesses, but only if they can figure out how to put a price tag on them.

Why it matters

For decades, state-owned companies in many developing nations have been inefficient. They often serve political goals rather than economic ones. This report suggests a path to privatize them. It means these companies might become more efficient, but only if the government can overcome the challenge of valuing them accurately. This could unlock private investment, but only if the valuation problem is solved.

The signal

Congo has a long history of sitting on World Bank recommendations. SOE reform is politically explosive. These companies employ tens of thousands and are patronage vehicles for political elites. Watch whether the IMF's concurrent program attaches conditionality to SOE reform. If it does, Congo has less room to delay.