Economic Analysis


Population 11.5 million
GDP per capita 942 US$
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major macro economic indicators

  2014 2015  2016 (f) 2017 (f)
GDP growth (%) 6.9 1.8 -6.4 0.3
Inflation (yearly average) (%) 1,7 3,7 -3,0 2,0
Budget balance (% GDP) -4,2 -5,2 -4,2 -2,2
Current account balance (% GDP) -9,0 -12,4 -7,5 -7,0
Public debt (% GDP) 39,2 42,6 47,0 43,0


(e) Estimate (f) Forecast


  • Exploitation of new oilfields  
  • Development potential of agricultural sector
  • Return of internal political climate more conducive to reforms


  • Excessive reliance on oil
  • Business climate not conducive to thriving private sector and high level of corruption
  • Geographic isolation
  • Worsening security conditions at both national and regional level (role of Boko Haram)


Weak oil prices and insecurity will hamper activity

After a sharp recession in 2016, activity is expected to stabilize progressively in 2017. Admittedly, oil exploitation will remain dominant (one fifth of GDP) and face persistent difficulties associated with oil price weakness. Nonetheless, even a moderate price increase and the exploitation of new oilfields in the south of the country, especially the one in Bongor, would help give activity a leg up. Meanwhile, growth is likely to be driven by the non-oil sector. Trade and transport (22% of GDP), still hampered by the worsening security conditions in the country’s and on its borders, will pick up. The agricultural sector (12% of GDP) is expected to drive growth, given the government's desire to support cotton production as a way of diversifying the economy, despite low world prices. With its five-year development plan (2016-2020), the government is demonstrating its resolve to rebalance the economy by taking full account of the country's agricultural potential. This plan also includes components designed to improve human capital, governance and social protection. However, public investment projects will continue to be constrained by weak government resources.

Finally the rising commodity prices and the disruption of trade with neighbouring countries (Cameroon and Nigeria) in connection with the difficult security context could bring inflation back.


Twin deficits will improve in 2017

The public deficit is expected to decrease in 2017. The end to 2016 election spending will relieve the burden on the public accounts. Oil tax revenues will increase thanks to revenues from the exploitation of the new oilfields, but will still not be enough to finance the economy. Fiscal assistance from the various financial donors will, moreover, continue to be a significant income item. Specifically, in November 2016, the IMF scheduled the transfer of USD 61 million under its Extended Credit Facility due to expire in November 2017. The budget restructuring will thus also be carried by spending cuts.

The increase in the issuance of securities on the regional market and payment arrears due to the contraction in oil revenues explain the rise in the debt in the past few years. On the other hand, Chad reached completion point under the HIPC initiative in April 2015. However, given the depreciation of the CFA franc in 2015, the debt cancellation related to this initiative had only a limited impact on the debt ratios.

The current account deficit is expected to decline in 2017, but will remain high. The trade surplus will increase on account of the increase in exports, primarily of oil, and the relative stability in the past of the currency against the US dollar (key trading partner).

The central bank's foreign exchange reserves will remain stable, at a worrying level of less than one month of imports.


High degree of insecurity persists amidst famine in the Lake Chad region

The parliamentary elections, initially planned for June 2015, were postponed indefinitely. The presidential elections were held in April 2016 in a tense atmosphere. Idriss Déby, president since 1991, was re-elected with almost 60% of the votes cast for a fifth five-year term. The results of this poll, together with the unstable economic, social and security climate of recent years, are starting to trigger tensions between the opposition and the government.

The main risks come from the armed conflict with the terrorist Boko Haram sect. Established mainly in northern Nigeria and the Lake Chad area, Boko Haram has conducted a growing number of suicide attacks in this region since 2015. In order to eradicate its influence in the region, the military cooperation between the four countries bordering the Lake Chad region (Cameroon, Niger, Nigeria, and Chad) and France remains strong. Chad is very active in fighting this terrorist group.

In addition, the security problems derive also from the increase in poverty and the emergence of famine associated with the loss of 90% of Lake Chad's water area in a few decades, pushing some young people to join Boko Haram. The lake around which live over 50 million people is key for the agriculture and fishing. To prevent the lake from drying out completely, an infrastructure plan is being discussed and some countries have increased their bilateral commitments, in particular France, which has committed to tripling its financial aid by 2020.

Governance remains worrying to the extent that Chad is among the countries with the most difficult business climate (183rd out of 189 countries in the World Bank's latest Doing Business Index). Corruption in Chad is also endemic.


Last update : March 2017

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