Zaire

INDUSTRY

Room where copper is electrolyzed at the Gécamines Luilu refinery near Kolwezi

Flow racks for the electrolyzed copper, Gécamines Shituru refinery near Likasi
Courtesy Gécamines

The manufacturing sector accounted for an estimated 1 percent of GDP in 1987, and 1.7 percent in 1988, down from 9 percent in 1981. The sector is concentrated in Kinshasa and the mining area of Shaba Region and consists largely of consumer goods, such as food processing, textile manufacturing, beer, cigarettes, metalworking and woodworking, and vehicle assembly. Manufacturing as a whole is hindered by many problems, including chronic mismanagement, lack of foreign exchange as well as long-term investment capital (especially the reluctance of foreigners to invest because of past nationalization schemes), a lack of spare parts, an inadequate transportation system, limited access to international markets, and a small domestic market that largely consists of consumers with little expendable income. Liberalization of economic policies in the late 1980s, however, resulted in an increase in production in some fields, most notably textiles, plastics, tobacco, and breweries.

The policy of import substitution begun between 1969 and 1972 was largely abandoned during the 1980s. The two most important enterprises established under the import-substitution policy were a General Motors vehicle assembly plant and a Continental Grains wheat mill, which was dependent on imported wheat. Goodyear also built a US$16 million tire plant in 1972. Promised rubber plantation investments never materialized.

By 1987 both General Motors and Goodyear had sold their enterprises to local businessmen, who were rumored to be backed by high government officials. General Motors and Goodyear had had chronic difficulties competing with cheap imports, which were frequently smuggled into the country or brought in exempt from import duties. Additionally, the proportion of raw materials imported for manufacturing was high. Moreover, companies suffered tremendous production difficulties when the foreign-exchange crisis of the mid-1970s hit.

Throughout the 1980s, most Zairian factories operated at just 30 percent of installed capacity. By most accounts, manufacturing in the formal economy had virtually ceased by 1992 in the wake of general economic chaos and several waves of military-led looting and rioting in Kinshasa. Factories, stripped bare, were forced to close, leaving thousands in the capital out of work. Shops and restaurants also closed.

Traditionally, numerous Zairian entrepreneurs have operated small- (three to four employees) and medium-sized businesses in the informal sector in Kinshasa. Such activities have continued, producing a wide range of products--e.g., furniture, clothes, crafts, food, and even vehicles chassis. Most such enterprises are unlicensed, but they fill a critical need in supplying the populace with otherwise unavailable or unaffordable goods.

Data as of December 1993