Page "Economy of the Central African Republic" Paragraph 16

A bricklayer in Paoua, Central African Republic. In the 40 years since independence, the CAR has made slow progress toward economic development.

Economic mismanagement, poor infrastructure, a limited tax base, scarce private investment, and adverse external conditions have led to deficits in both its budget and external trade.

Its debt burden is considerable, and the country has seen a decline in per capita gross national product over the last 40 years.

Important constraints to economic development include the CAR's landlocked position, a poor transportation system, a largely unskilled work force, and a legacy of misdirected macroeconomic policies.

The 50 % devaluation of the currencies of 14 Francophone African nations on 12 January 1994 had mixed effects on the CAR's economy.

Diamond, timber, coffee, and cotton exports increased, leading an estimated rise of GDP of 70 % in 1994 and nearly 50 % in 1995.

Military rebellions and social unrest in 1996 were accompanied by widespread destruction of property and a drop in GDP of 2 %.

Ongoing violence between the government and rebel military groups over pay issues, living conditions, and political representation has destroyed many businesses in the capital and reduced tax revenues for the government.