Fcfa 595.6 Billion Required to Kick-Start Chad's Industrial Masterplan

10 March 2020

Experts describe the new Industrialization and Economic Diversification Masterplan (PDIDE) as the necessary trigger for an economic miracle in this Sahelian country

Yaounde/N'Djamena, 9 March, 2020 (ECA) - The Republic of Chad now has its very first Industrialization and Economic Diversification Masterplan (PDIDE, in French) which aims to jack-up the country's economic growth rate from around -2% (in 2017) to more than 8% per year by 2030. This is the result of considerable effort, coordinated by the Sub-Regional Office for Central Africa of the UN Economic Commission for Africa (ECA) and the Chadian Government, through a participatory and inclusive process which started in October 2018.

Described as "the benchmark for an economic miracle in Chad with a very promising potential" by Mr. Adama Coulibaly, Head of the Sub-Regional Initiatives Section of ECA's Sub-Regional Office for Central Africa, the Masterplan was validated on March 6, 2020 in N'Djamena, the Chadian capital, after a meticulous review by various stakeholders, including: senior officials and national and international experts, leaders of the private sector, representatives of the civil society, academics, as well as young entrepreneurs from the country.

According to Mr. Coulibaly, "This Masterplan serves to broaden and transform the base of industrial production and provide economic defenses for sustainable and inclusive growth in Chad by 2030."

A laser-focused Presidential initiative

Spread over ten (10) years, the Plan, which was elaborated following the directives of the President of the Chadian Republic - HE Mr. Idriss Déby, relayed by his Minister of Economy and Development Planning - Mr. Issa Doubragne, requires an initial investment of around FCFA 595.6 billion (or US $ 985.2 million) for the related projects between 2020 and 2022.

The adoption of the PDIDE comes just a few days after the inauguration, last February 29, by President Idriss Déby of a meat processing center known as Complexe Industriel des Abattoirs du Logone (CIAL), located in Ngara village, which is 7km from the city of Moundou (South of Chad). This investment, in line with the strategic directions of the PDIDE, will boost the processing, storage, packaging and marketing of more than 20,000 tons of meat per day.

The slaughterhouse, which will generate nearly 700 direct jobs and 1,500 indirect ones, is listed among the PDIDE projects meant to enhance the agricultural, livestock and fisheries sectors by the PDIDE, hence confirming the relevance of the diagnosis and recommendations of the Masterplan.

Speaking of the PDIDE, the Director General of the Economy of Chad - Mr. Aboubakar Adam Ibrahim - stressed that it aims to "promote economic diversification through natural resource-based and external trade-induced industrialization, in line with the country's own comparative advantages".

"The PDIDE is therefore designed to succeed with the process of a profound and coherent industrial drive, pretty much in line with the fundamental characteristics of the domestic economy," he added.

But it is also a question of equipping Chad with the "aptitude" to face the competition around the corner with the advent of the African Continental Free Trade Area (AfCFTA) and to take advantage of the opportunities offered by a wider and better integrated regional market, as pointed out by the Minister of Mines, Industrial and Commercial Development and the Promotion of the Private Sector - Ms. Achta Djibrine Sy, during a meeting with members of the ECA mission to N'Djamena on 6 March.

Synergies for sectors with great potential

To do this, all stakeholders, under the coordination of the Government, must first focus on the production and distribution of renewable energy (with 33 projects identified in this sector) and on investments in transport infrastructure including roads , railways, river and lake transport, dry ports, warehouses; development of urban infrastructure and housing (23 projects / programs identified). The country must also strengthen its ecosystem in order to facilitate the establishment of industrial companies and financial and non-financial services, in particular the construction of industrial hubs / special economic zones, starting with the most promising areas of the country's main cities (N'Djamena, Moundou, Sarh and Abéché).

The key sector-based routes for the industrialization and diversification of Chad, called twelve (12) pillars of the PDIDE, are as follows: i) meat, leather, milk, ii) spirulina, sesame and shea, iii) cotton, Arabic gum iv) refining and petrochemicals, v) gold mining, vi) quarrying, vii) metallurgical industry, viii) fiber optic network, ix) data center, intelligence x) cement production, xi) marble processing; and xii) brick production.

Required funding within full reach of the country

The "green" nature of the PDIDE and its concern to preserve environmental balance through a low greenhouse gas emission industrialization trajectory has been identified as an anchor for the mobilization of global resources related to the adaptation and reduction of the effects of climate change.

Mr. Jean Luc Mastaki, Economic Affairs Officer at ECA's Sub-Regional Office for Central Africa argues that "the PDIDE should be supported by innovative financing, including, access to green funds, such as carbon funds and to mobilize the opportunities offered by Islamic Finance and the local and sub-regional financial markets, among others."

"But it is absolutely necessary to place the private sector at the heart of the PDIDE, and improve the business climate to promote investments by nationals while attracting foreign direct investments. It remains imperative to strengthen local capacities in terms of maturing bankable projects in order to attract the required funding," he noted.

All participants involved in the internal and external validation process of the PDIDE, have stated their conviction that the Masterplan is both spot-on and achievable. This initiative, which falls within the "Presidential Perimeter", will immediately be placed on the table of the Chadian Government for rapid implementation, with an Action Plan already drawn up.

Key recommendations for the rapid implementation of the PDIDE

Reinforce the coherence and synergy between the PDIDE and other strategic development documents of Chad, including the National Development Plan, the Private Sector Development Strategy, the National Spatial Planning Scheme; and Chad's Investment Charter;

Build a strong synergy and a permanent dialogue between the public and private sectors;

Immediately strengthen the capacities of the private sector and promote reforms aimed at improving the business climate for an optimal participation of private investors in the implementation of the PDIDE;

Mobilize the Chadian economic diplomacy arsenal to attract funding, identify export niches and encourage the public sector to support the private sector in its efforts to produce and make inroads into markets;

Establish a High-level PDIDE Steering Committee, which should be functional, and institutionally anchored at the Presidency of the Republic, federating the efforts all the stakeholders involved in the implementation of the Masterplan;

Highlight the indispensable role to be played by the political will and visionary posture of the State;

Insist on the green nature of the PDIDE as an anchor point for the mobilization of innovative financing linked to the Sustainable Development Goals (SDGs);

Promote better use of ICTs for financial inclusion and the mobilization of savings to finance the PDIDE;

Deepen understanding of the successful experiences of African and non-African countries which are already involved in the industrialization process such as Rwanda, Ethiopia, Singapore, South Korea etc. to render the Chadian experience inclusive and efficient;

Create a multisector technical unit for orienting and maturing industrial projects, attached to the Ministry of Economy and Development Planning;

Quickly develop a Communication and outreach Strategy for the Masterplan in order to bolster popular "buy-in" and revive the political will around the initiative; and

Finalize the Action Plan for the realization of PDIDE projects.

Media Contact

Abel Akara Ticha - Communication Officer

UN Economic Commission for Africa

637, rue 3.069, Quartier du Lac, Yaounde, Cameroon

Tel: +237 222504348

E-mail: akara@un.org

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