The United Nations' Human Development Index ranks Chad as the fifth poorest country in the world, with 80% of the population living below the poverty line. The GDP (PPP) per capita was estimated as US$1,500 in 2005. Chad is part of the Bank of Central African States and the Customs and Economic Union of Central Africa (UDEAC). Its currency is the CFA franc. Years of civil war have scared away foreign investors; those who left Chad between 1979 and 1982 have only recently begun to regain confidence in the country's future. In 2000 major direct foreign investment in the oil sector began, boosting the country's economic prospects.

Over 80% of Chad's population relies on subsistence farming and livestock raising for its livelihood. The crops grown and the locations of herds are determined by the local climate. In the southernmost 10 percent of the territory lies the nation's most fertile cropland, with rich yields of sorghum and millet. In the Sahel only the hardier varieties of millet grow, and these with much lower yields than in the south. On the other hand, the Sahel is ideal pastureland for large herds of commercial cattle and for goats, sheep, donkeys and horses. The Sahara's scattered oases support only some dates and legumes. Before the development of oil industry, cotton dominated industry and the labour market and accounted for approximately 80% of export earnings. Cotton remains a primary export, although exact figures are not available. Rehabilitation of Cotontchad, a major cotton company that suffered from a decline in world cotton prices, has been financed by France, the Netherlands, the European Union, and the International Bank for Reconstruction and Development (IBRD). The parastatal is now expected to be privatised.