The Democratic Republic of the Congo has signaled a significant commitment to economic transformation by dedicating $500,000 to a comprehensive partnership with the United Nations Conference on Trade and Development, marking a strategic shift toward evidence-based development planning in one of Africa’s most resource-rich yet economically challenged nations.
The investment, announced by UNCTAD on November 26, 2024, will support analytical research, technical cooperation, and the development of a holistic program designed to strengthen the country’s productive capacities—the core resources, skills, infrastructure, and institutions that enable nations to produce goods and services competitively and sustainably. This initiative represents the Congolese government’s renewed push for stronger productive capacity to drive economic transformation, inclusive growth, and sustainable development in a nation that has long struggled to translate its vast natural wealth into widespread prosperity.
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Understanding Productive Capacities in Development Context
Productive capacities, as defined by UNCTAD, refer to “the productive resources, entrepreneurial capabilities and production linkages that together determine the capacity of a country to produce goods and services and enable it to grow and develop.” These capacities are often key to economic diversification and resilience-building, particularly for least developed countries facing the challenge of breaking dependence on primary commodity exports.
In a world of rising uncertainty and frequent economic shocks, it has become increasingly crucial for countries to build, maintain, and enhance these capacities to create jobs, add value to domestic industries, and strategically position themselves in global supply chains. For nations like the Democratic Republic of the Congo, developing productive capacities represents a pathway toward reducing vulnerability to commodity price fluctuations and external economic pressures that have historically destabilized national development plans.
The significance of productive capacity development was underscored in UNCTAD’s Least Developed Countries Report 2021, which emphasized that boosting these capacities is essential for the world’s poorest countries to respond to and recover from crises while advancing toward sustainable development. The report noted that developing productive capacities allows countries to foster structural economic transformation, which in turn helps reduce poverty and accelerate progress toward the UN Sustainable Development Goals.
The Groundbreaking Productive Capacities Index Framework
Central to UNCTAD’s approach is its multidimensional Productive Capacities Index, launched in 2021 to identify gaps and provide policy recommendations for 195 economies worldwide. The index represents a groundbreaking tool that enables countries to look beyond traditional metrics like gross domestic product to assess their actual productive potential across eight critical categories: human capital, natural capital, energy, information and communication technologies, transport, institutions, the private sector, and structural change.
The methodology covers 43 indicators across these categories, making it multidimensional in its analytical abilities and capable of diagnosing specific areas where countries may be leading or falling behind. This granular approach allows policymakers to identify precisely where interventions are needed and where corrective efforts should be concentrated to maximize developmental impact.
The index has been particularly valuable for least developed countries, providing them with evidence-based tools to formulate development strategies tailored to their specific constraints and opportunities. UNCTAD updated the index in 2023, incorporating enhanced statistical methods and expanded data coverage to provide more accurate assessments of countries’ productive capacities and their evolution over time.
DR Congo’s Current Economic Landscape and Challenges
The Democratic Republic of the Congo presents a paradoxical economic picture—a nation endowed with extraordinary natural wealth yet struggling with persistent poverty and underdevelopment. The country is home to an estimated $24 trillion in mineral resources, including vast reserves of copper, cobalt, gold, diamonds, and lithium, placing it among the world’s most resource-rich countries. The DR Congo holds approximately 50% of the world’s known cobalt reserves and supplies around 70% of global cobalt demand, cementing its central role in the global supply chain for electric vehicle batteries and clean energy technologies.
Despite these immense natural endowments, an estimated 73.5% of Congolese people lived on less than $2.15 a day in 2024, making the DR Congo one of the poorest nations globally. About one in six people living in extreme poverty in Sub-Saharan Africa reside in the Democratic Republic of the Congo, highlighting the stark disconnect between the nation’s resource wealth and the lived reality of its citizens.
The country’s economy has experienced significant growth in recent years, expanding by 6.5% in 2024, driven primarily by a 12.8% expansion in the extractive sector, particularly copper and cobalt production. However, this growth has been heavily concentrated in capital-intensive mining operations that generate limited employment opportunities. Non-mining sectors grew by just 3.2% in 2024, reflecting the ongoing challenges of economic diversification and the dominance of extractive industries in the country’s economic structure.
The extractive sector continues to account for 99% of total exports, according to International Monetary Fund assessments, underscoring the economy’s dangerous dependence on a narrow range of commodities whose prices are subject to volatile global market forces. This concentration creates significant vulnerability to external shocks and limits the country’s ability to generate broad-based economic opportunities for its rapidly growing population.
Structural Impediments to Transformation
The DR Congo faces formidable structural challenges that have hindered its economic transformation despite decades of development efforts. Infrastructure deficits represent one of the most critical constraints, with poor road networks, unreliable electricity supply, and limited telecommunications coverage impeding private sector development and constraining the emergence of non-mining production sectors.
The country’s limited digital infrastructure holds back its performance in energy and information and communication technology—both core components measured by the Productive Capacities Index. This digital divide not only affects business productivity but also limits access to education, health services, and government programs in remote areas, perpetuating cycles of underdevelopment.
Structural transformation has been slow, with employment gradually shifting from agriculture to services but with limited progress in developing a robust manufacturing sector. Between 2005 and 2020, agriculture’s share of employment fell from 71.1% to 60%, while industry’s share rose modestly from 7% to 10.7%, and services climbed from 22% to 29.3%. However, much of this shift represents movement into low-productivity informal sector activities rather than sustainable, well-paying jobs in modern industries.
The dominance of capital-intensive mining means that capital accounts for 82% of production inputs while labor represents only 18%, creating a development model that generates wealth for a small elite and foreign investors while providing limited opportunities for the broader population. This imbalance contributes to high unemployment, particularly among youth, and fuels social tensions that compound the country’s governance challenges.
Additional constraints to structural transformation include border insecurity—particularly in the eastern regions where armed conflict has displaced millions—an unattractive business environment characterized by bureaucratic obstacles and corruption, and fundamental weaknesses in human capital, institutions, governance, and access to financing. These interconnected challenges create a vicious cycle where poor governance undermines economic development, which in turn limits the resources available for improving governance and public services.
How DR Congo Performs on Productive Capacity Metrics
UNCTAD data reveal that the Democratic Republic of the Congo has made progress, albeit modest and inconsistent, toward productive capacity development. As the second largest country in Africa by area, with a population of approximately 111 million inhabitants, the DR Congo’s economic indicators reflect both its potential and the constraints holding back its development.
The nation performs relatively better on its natural capital score, reflecting its vast mineral and land resources that provide a foundation for future economic development. However, this natural wealth alone has proven insufficient to drive broad-based prosperity without complementary investments in human capital, infrastructure, and institutional capacity.
In terms of human capital, the DR Congo faces significant challenges. The rapid expansion of the education sector has occurred in an environment characterized by internal inefficiencies and low learning outcomes, according to World Bank assessments. A learning crisis at foundational levels extends into secondary education, creating a situation where the country has a young but under-skilled workforce. This mismatch between educational outcomes and labor market needs poses serious risks to future productivity and economic competitiveness.
The country’s infrastructure weaknesses are particularly pronounced in energy and transportation, two critical enablers of economic activity. Limited electricity access constrains industrial development and forces businesses to rely on expensive and polluting diesel generators. Poor road and rail networks increase transportation costs and limit market access for agricultural producers, reducing their competitiveness and reinforcing rural poverty.
The UNCTAD Support Program Structure
The $500,000 commitment from the DR Congo will fund a comprehensive package of support activities designed to strengthen the country’s analytical capabilities and policy formulation processes. The program includes several interconnected components that build upon each other to create sustainable capacity for evidence-based development planning.
First, UNCTAD will apply the Productive Capacities Index to analyze gaps and potential across the eight components of productive capacities specific to the DR Congo’s context. This diagnostic work will provide a detailed baseline assessment identifying the country’s comparative advantages, binding constraints, and priority areas for intervention.
Second, the program includes technical cooperation and training on the PCI methodology to improve statistical and institutional capacities within government agencies. This capacity building component aims to ensure that Congolese officials can independently utilize the index framework for ongoing monitoring and policy adjustment, creating lasting institutional knowledge rather than dependence on external expertise.
Third, UNCTAD will undertake a comprehensive National Productive Capacities Gap Assessment that maps domestic policies, institutions, and comparative advantages while identifying key constraints through broad-based consultations with government, private sector, civil society, and development partners. This participatory approach ensures that the assessment reflects diverse perspectives and builds buy-in for the resulting recommendations.
Finally, the partnership will culminate in the formulation of a Holistic Productive Capacities Development Programme—an integrated, multi-sectoral, multi-year plan to guide structural transformation. This program will be supported by ongoing UNCTAD technical guidance for implementation, helping to bridge the gap between planning and execution that has undermined many previous development initiatives.
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Strategic Context of President Tshisekedi’s Second Term
The productive capacity initiative aligns with priorities outlined by President Felix Tshisekedi at his second inauguration in January 2024, where he emphasized fighting corruption, advancing economic and infrastructure development, bolstering security and stability, and improving governance. His address signaled a potentially improved business environment for investors eyeing the DR Congo’s future development, though translating these commitments into tangible progress remains a significant challenge.
The government has introduced several policy measures aimed at creating a more attractive investment climate, including the Decree on Strategic Partnership in Value Chains, the Industrial Property Act, the Public-Private Partnership Act, the Competition Act, and the Special Economic Zones Act. This comprehensive legislative framework aims to address longstanding obstacles to private sector development and foreign direct investment.
The country has also seen improvements in its international credit ratings, with Standard & Poor’s raising it from ‘CCC+’ to ‘B-‘ in January 2022, and Moody’s upgrading it from ‘B3, Stable Outlook’ to ‘B3, Positive Outlook’ in November 2022. These upgrades reflect positive developments in the Congolese economy and institutional improvements supported by the International Monetary Fund program initiated in July 2021.
However, significant governance challenges persist. The DR Congo continues to face issues with corruption, weak rule of law, and limited state capacity, which undermine investor confidence and impede economic development. The judicial system faces challenges in swiftly safeguarding investors’ rights and remains susceptible to political influence. These institutional weaknesses mean that policy reforms on paper often fail to translate into changed behavior and improved outcomes on the ground.
China’s Dominant Position in Congolese Mining
Any discussion of the DR Congo’s economic future must account for China’s dominant position in the country’s mining sector, where Chinese companies control nearly 80% of copper and cobalt production. This dominance stems from the 2008 Sicomines agreement—a minerals-for-infrastructure deal that has fundamentally reshaped the country’s economic landscape.
Under this arrangement, Chinese firms committed billions of dollars to infrastructure projects in exchange for mining rights to deposits valued at approximately $93 billion. The agreement was renegotiated in 2024 in a manner more favorable to the DR Congo, with the Sino-Congolese mining joint venture Sicomines now paying an annual royalty of 1.2% of its revenue to the state since January 2024.
While Chinese investment has financed important infrastructure development, including roads and hospitals, it has also created dependencies and raised concerns about the terms of resource extraction and revenue sharing. The concentration of mining assets in Chinese hands limits the DR Congo’s policy flexibility and bargaining power, though recent renegotiations suggest growing confidence in asserting national interests.
The United States has historically underinvested in commercial engagement with the DR Congo, allowing China to establish a commanding position. However, recent American interest in securing critical mineral supply chains has prompted new attention to the country, including a 2022 memorandum of understanding with the DR Congo and Zambia to support development of an electric vehicle value chain. This emerging competition between major powers could potentially benefit the DR Congo if managed strategically, though it also risks exacerbating geopolitical tensions.
Regional Security Challenges and Economic Impact
The DR Congo’s development efforts occur against a backdrop of persistent insecurity, particularly in the eastern provinces where armed conflict has created a humanitarian catastrophe. The Rwanda-backed M23 rebel group has seized control of significant territories, including major cities, displacing millions of people and creating one of the world’s largest humanitarian crises.
The conflict has direct economic consequences beyond the immediate human toll. Armed groups control access to mineral resources in eastern provinces, with gold and other minerals being smuggled across borders to Rwanda and Uganda, depriving the Congolese government of tax revenues and funding continued violence. The U.S. Treasury Department estimated in 2022 that over 90% of the DR Congo’s gold was being smuggled to regional states, representing billions of dollars in lost revenues.
The instability in the east creates significant obstacles to any comprehensive development strategy. It displaces populations who might otherwise engage in productive economic activities, disrupts transportation routes, diverts government resources toward military expenditures rather than development investments, and deters both domestic and foreign investment in affected regions. Until security improves, even well-designed capacity building programs will struggle to achieve their full potential in conflict-affected areas.
Pathways Toward Economic Diversification
The DR Congo’s 2024-2028 Government Action Programme, valued at nearly $93 billion, aims to stimulate economic activity by supporting key sectors including agriculture, transport, and security. Agriculture represents one of the most promising areas for diversification, given the country’s vast arable land and favorable growing conditions, yet the sector remains dominated by subsistence farming with limited commercial development.
Manufacturing offers another potential pathway for structural transformation, but development of this sector requires reliable electricity, skilled labor, access to financing, and supportive infrastructure—precisely the areas where the DR Congo currently struggles. Some analysts project that a focused manufacturing scenario could have the most significantly positive impact on GDP per capita among various development interventions, followed by governance improvements and participation in the African Continental Free Trade Area.
Regional integration through the East African Community, which the DR Congo joined, could provide market access opportunities and facilitate technology transfer, though tangible macroeconomic benefits have not yet materialized. Success in leveraging regional integration will depend on addressing infrastructure gaps and reducing trade barriers that currently limit cross-border commerce.
The development of value-added processing of mineral resources represents another diversification opportunity. Rather than exporting raw materials for processing elsewhere, the DR Congo could capture more value by developing domestic refining and manufacturing capabilities for battery components and other mineral-based products. However, this requires substantial investments in industrial capacity, technical skills, and reliable energy supply.
Climate and Energy Considerations
The DR Congo’s development strategy must navigate the global transition toward clean energy and electric vehicles, which presents both opportunities and risks. Growing demand for cobalt, copper, and lithium positions the country strategically in the clean energy supply chain, but also raises concerns about environmental degradation and social costs of intensified mining.
The country possesses enormous renewable energy potential, particularly hydroelectric power from the Congo River system. The long-delayed Inga III hydroelectric project, estimated to cost $14 billion and designed to generate 4,800 megawatts, could transform the country’s energy landscape if completed. However, the project has faced repeated delays due to governance concerns and financing challenges, with the World Bank suspending funding in 2016 over transparency issues.
Developing clean energy infrastructure could provide a competitive advantage for energy-intensive industries while positioning the DR Congo as a responsible supplier of critical minerals for the global clean energy transition. However, realizing this potential requires overcoming the political economy challenges that have plagued large infrastructure projects in the past.
The Broader Context of International Support Measures
The DR Congo’s domestic capacity building efforts must be complemented by reformed international support measures better aligned with 21st century development challenges. UNCTAD has emphasized that least developed countries need a new generation of international support, particularly regarding technology transfer, climate finance, and debt relief.
The country benefits from World Bank support totaling $7.6 billion across 22 national projects as of September 2025, with engagements spanning economic management, governance, human capital development, sustainable infrastructure, and digital transformation. These investments have yielded tangible results, including 4.4 million additional students enrolled in primary schools and improved health services reaching 27% of the population.
However, aid effectiveness depends on the absorptive capacity of government institutions and the alignment of donor priorities with national development strategies. Fragmented donor interventions, lack of coordination, and parallel project implementation units can undermine rather than strengthen national capacity. The UNCTAD partnership’s emphasis on building domestic analytical capabilities and institutions aims to address these challenges by strengthening the government’s ability to coordinate and lead its own development process.
Looking Forward: Challenges and Opportunities
The $500,000 commitment to UNCTAD represents a modest but symbolically important investment in evidence-based development planning. By dedicating domestic financial resources rather than relying entirely on donor funding, the DR Congo signals ownership of the process and commitment to implementing resulting recommendations.
Success will require sustained political will beyond the planning phase to implement what are likely to be difficult structural reforms. Vested interests that benefit from the current extractive-industry-dominated model may resist changes that threaten their position. Bureaucratic inertia and capacity constraints within government institutions will pose implementation challenges. And the volatile security situation in eastern provinces could disrupt even well-designed programs.
Yet the alternative to pursuing structural transformation is continued vulnerability to commodity price shocks, persistent poverty despite vast natural wealth, and growing frustration among a young population that sees limited economic opportunities. With a population projected to reach 164 million by 2043, with 57% of working age, the DR Congo faces both a demographic opportunity and a looming crisis if job creation does not keep pace with labor force growth.
The productive capacity framework offers a systematic approach to identifying and addressing the binding constraints on broad-based economic development. By focusing on the foundational elements—human capital, infrastructure, institutions, and productive linkages—rather than seeking quick fixes, the DR Congo can lay groundwork for sustained transformation. Whether this latest initiative succeeds where previous efforts have fallen short will depend on maintaining focus and momentum through the difficult implementation phase that lies ahead.
Conclusion
The Democratic Republic of the Congo’s partnership with UNCTAD on productive capacity development comes at a critical juncture for a nation blessed with extraordinary resources yet burdened by persistent underdevelopment. The commitment of $500,000 for comprehensive gap assessment, capacity building, and program formulation represents recognition that translating natural wealth into shared prosperity requires systematic strengthening of the economic foundations that enable countries to produce, compete, and grow.
The Productive Capacities Index provides a powerful diagnostic tool for identifying specific gaps and opportunities across human capital, infrastructure, institutions, and other critical dimensions. The holistic program that will emerge from this assessment offers a framework for coordinated interventions addressing interconnected challenges that have resisted piecemeal solutions.
Yet diagnostic tools and planning frameworks alone cannot overcome the political economy obstacles, governance challenges, and security threats that have constrained the DR Congo’s development for decades. Success will require sustained leadership commitment, strengthened institutional capacity, improved governance and transparency, strategic investments in infrastructure and human capital, and supportive international partnerships that complement rather than substitute for domestic efforts.
For a country where tens of millions struggle in poverty despite living atop trillions of dollars in mineral wealth, the stakes could not be higher. The productive capacity initiative offers a pathway toward breaking this paradox, but only if translated into concrete action that builds the foundations for diversified, inclusive, and sustainable economic growth. The coming years will reveal whether this latest commitment to evidence-based development planning marks a genuine turning point or becomes another unrealized aspiration in the long history of unfulfilled development promises in one of Africa’s most challenging yet potentially transformative nations.
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By: Montel Kamau
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27th November, 2025
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