Previous Quarterly Editions
Expropriation Risk: 66 66 66 69 Political Violence Risk: 66 66 68 68 Terrorism Risk: 35 35 35 35 Exchange Transfer and Trade Sanction Risk: 64 64 64 64 Sovereign Default Risk: 75 75 75 75
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For the Central African Republic (CAR), the early months of 2021 have been a period of widespread conflict and humanitarian dislocation. In the run-up to the first round of Presidential elections, scheduled for December 27, 2020, several rebel groups, grouped in the newly formed Coalition of Patriots for Change (CPC), have launched a fresh revolt, rapidly advancing from north-western and central regions towards the capital, Bangui.
Rebel fighters directly avoided any confrontation with the 11,000-strong United Nations peacekeeping force MINUSCA (United Nations Multidimensional Integrated Stabilization Mission in the Central African Republic). Since January 2021, government forces supported by men from the Russian security company Wagner and troops from Rwanda (with which the CAR is allied) have successfully defended Bangui and regained much of the territory that rebels had occupied. The key supply road from the Cameroon border to Bangui has been reopened. However, a major humanitarian crisis persists. The United Nations says that 2.8 million of the CAR’s 4.9 million people need humanitarian assistance. Some 650,000 have fled to neighbouring countries and 738,000 are internally displaced.
The election had been viewed as a key next step in the gradual effort to restore peaceful normality to a country that has suffered chronic insecurity since the mainly Muslim Seleka rebel alliance (which has since fragmented) overthrew President François Bozizé in 2013. Mainly it was Christian community militias, the Anti-Balaka, who fought back.A slide into generalised sectarian conflict and potential genocide was only prevented by the deployment of French and African peacekeeping forces who protected MINUSCA as they performed their duties to painstakingly restore the civil state. .
Peaceful elections in December 2015-February 2016 saw Faustin-Archange Touadéra, a former university rector and Bozizé’s prime minister, elected President, and in February 2019 the government and leaders of 14 armed groups, meeting in Khartoum, Sudan, reached a peace deal. MINUSCA gradually extended the authority of the central government, although significant areas of the country remained under the control of various rebel factions.
To bind them into the peace process, Touadéra appointed some rebels to government posts. Meanwhile, the CAR Special Court was established and staffed by both national and international judges, to prosecute and judge the authors of major human rights crimes and act as a deterrent to any return to arms. Touadéra also agreed a security partnership with Russia, while a European Union military mission retrained the national army.
Preparations for the December 2020 presidential vote went relatively well. Bozizé returned from exile to contest the election but was disqualified because he is the subject of an international arrest warrant and UN sanctions. But just weeks beforehand, several rebel groups that had lost faith in the peace accord launched the new CPC rebellion. The government and the CAR’s international partners believed that Bozizé was playing a key role in the revolt, and he did later formally assume the role of rebel coordinator.
The CAR authorities and MINUSCA were determined that the electoral timetable should not be thrown off course. In areas that are home to about half the population, no voting was possible on December 27 2020, but presidential and parliamentary elections did take place in good conditions and amid voter enthusiasm in Bangui and many other areas. Touadéra secured 53.16% of the total vote, ahead of runner up Anicet-Georges Doleguélé (21.69%).
The elections authority and the constitutional court declared Touadéra the winner on the grounds that his lead was too great to have been overtaken even if voting had been possible nationwide. Nonetheless, delayed parliamentary elections were later organised in areas that had been disrupted by insecurity on December 27, 2020. In April 2021, Touadéra launched talks to prepare a political dialogue.
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In current conditions, the CAR would struggle to attract more than minimal investment and the government would be strongly motivated to treat favourably any international partners prepared to invest in activities such as local power generation or key supply concessions.
Reserves of diamonds and other minerals are mostly extracted on an artisanal or small industrial basis. The authorities might remove mining permits from entrepreneurs who collaborated with rebel warlords but serious investors who operated under the proper authority of state regulation are likely to be treated favourably.
Despite the continuing success of the fightback by the government and its allies (who in mid-April 2021 retook the strategic town of Kaga Bandoro), the rebel groups remain a serious threat. Ali Darassa, leader of the Union for Peace in the Central African Republic (UPC) faction, has announced his withdrawal from the CPC and return to the peace process. However, his statement has been regarded with scepticism.
While the threat of prosecution for human rights crimes might deter some rebel leaders from renewed violent activity and nudge them back into the peace process, it is difficult for the government to provide them with a powerful incentive to enter normal peaceful political life and abandon their profitable local fiefdoms and protection rackets.
Somehow, the government and wider peaceful political class, MINUSCA and other international partners, need to convey the sense that order, stability and routine institutional life are being established and that ultimately it makes sense for rebels to join this process. The government also has to offer ordinary rebel fighters a functioning path to demobilisation and return to viable civilian livelihoods. That is a huge challenge.
Despite suffering chronic instability and violence, the CAR has so far not seen significant activity by jihadist or other radical groups. Meanwhile, the localised sectarian tensions evident several years ago have eased. However, the risk of terrorism should not be totally excluded, given the country’s fragility and militant activity in the Lake Chad region of neighbouring Chad and Cameroon.
The sudden death in April 2021 of President Idriss Déby of Chad has cast uncertainty over the stability of this northern neighbour of the CAR, which has hitherto been the major regional security actor.
The CAR is a member of the Central African Economic and Monetary Community (CEMAC), one of two blocs using the CFA franc common currency, that is pegged to the euro under a French state guarantee. Reform plans, modelled on those already developed in the West African Monetary and Economic Union (with the French acronym UEMOA), but less ambitious, aim to modernise the system, but the fixed peg will probably continue to be underpinned by member countries depositing a share of their foreign exchange in Paris and retaining a French representation in the CEMAC financial governance structure.
It is highly likely that some prominent rebel figures could become the subject of international personal financial sanctions because of their suspected role in war and human rights abuse. But the CAR state - a genuine democracy, despite its massive security challenges - is not a potential sanctions target; it is strongly supported by the United Nations and by European governments.
The CAR is massively dependent on international assistance, which is certain to continue. At this stage in the country’s slow recovery from deep crisis, the overall economic performance factors and the impact of the COVID-19 pandemic on economic activity are of secondary significance. But if the process of stabilisation continues, and the government can begin to focus on more routine development and public administration activities, then issues of fiscal management and economic strength will become more significant.
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