1. the Chadian Economy Is Largely Based on Agriculture, Including Livestock Rearing, and Since 2003, on Petroleum
WT/TPR/S/174 Trade Policy Review Page 50 IV. ANALYSIS OF TRADE POLICIES AND PRACTICES BY SECTOR (1) INTRODUCTION 1. The Chadian economy is largely based on agriculture, including livestock rearing, and since 2003, on petroleum. An output of about 160,000 barrels a day made it possible to virtually double GDP in 2005-2006, given the record levels reached by world oil prices. The Government is now giving priority to production sharing contracts, under which the State holds a capital stake in oil projects in order to maximize the benefits to the country. However, since it has no refinery Chad exports the crude and import refined products, at their current exorbitant prices, further inflated by the country’s land-locked situation. 2. The aim of food security, an integral part of agricultural policy, goes hand-in-hand with the strategy to combat poverty and malnutrition. Yet much of the budget earmarked for agriculture is used to support the monopoly State enterprise in the cotton sector. In addition, agricultural exports and imports are subject to heavy official and informal taxes, which are a disincentive to private investment. This is encouraging the informal exportation of cattle, which is Chad's second source of foreign exchange earnings after petroleum. Besides, internal organization and the international environment are negatively impacting the cotton sector, which has been in crisis for some years now. 3. Manufacturing is an infant industry; it comprises mainly companies in the agri-food sector, which caters principally for the local market given the limited competitiveness (for numerous reasons) of its products, as well as the limited capacities of manufacturing companies.
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