The Past and the Future Effects of Russian-Ukrainian Conflict on the Democratic Republic of Congo Economic Policy
DOI:
https://doi.org/10.57125/FEL.2023.09.25.12Keywords:
Russo-Ukrainian conflict, inflation, transmission channel, prices, DRCAbstract
The aim of this research was to investigate the past and the future effects of the Russo-Ukrainian war on the DRC (Democratic Republic of Congo) economy policy. The forecast method based on the UCL: Upper control limit, LCL: Lower Control Limit was used. The data have been collected from various reports of the central bank and Economics Ministry and it concerned the series times collected from 2018-2022. The forecast made in this study concerned the 5-year period from 2023-2027. The results showed that the impact of this war on the various sectors of the Congolese economy was especially positive and negative to macroeconomics various indicators in DRC. After using the SPSS forecasting on 9 variables, 4 variables increased due to the war. Positive effects on the credit economic, will rise from 4.53 initially to 9.42 in 2027, the Bank deposit will also rise from 8.13% in 2022 to 9.97%. Exports from the DRC will increase by 38.06% versus 31.36% initially. On the other hand, 5 variables showed negative effects induced by the Russo-Ukrainian war in DRC. The inflation rate will rise to 80.8% in 2027 from 12.62% initially. Also, the exchange rate, a headache for the current Sama Lukonde government, will reach the overheated level of 3472CDF to the US dollar, compared with the original rate of 2000. The DRC's imports will grow by 44.05% in 2027, reinforcing its dependence on specific foreign products, including machinery and other equipment, and foreign currency oil product prices, which will rise by an average of 12.12% across the country. The innovative aspect of this research was the integration of the behaviors or predilections made on the various macroeconomic variables of the DRC in a 5-year time frame due to the conflict between Russia and Ukraine. Changes in eating habits by adopting consumers' tastes or households to local products that are perfect substitutes for Russian or Ukrainian imports, and monetary policy were envisaged in the paper. In the longer term, the energy transition is no longer an option but a necessity, as the country has the necessary potential in this field. Nevertheless, it remains a perilous path in the sense that it requires fairly substantial capital.
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