Guinea - economic analysis. The most important information for investor.

Economic risks: 3.75
Guinea is among the poorest countries in the world. Nevertheless, it has great untapped economic potential, notably in the development of agriculture and mining (especially bauxite, gold and diamonds). The government has made far-reaching free market reforms since abandoning Marxism during the mid-1980s. Although it has strengthened commercial ties with France, Guinea remains outside the regional bloc of other former French colonies (UEMOA).

diamonds in Guinea

Guinea - Economic Data

1999
2000
2001
2002e
2003f
2004f
2005f
2006f
2007f

Domestic Data

A - GDP Growth %
4.6
2.1
3.6
4.2
4.9
5.3
5.4
5.95
6.2

F - Agriculture % GDP
24.29
24.01
24.82
24.56
24.75
..
..
..
..

G - Industry % GDP
4.23
4.17
4.48
4.6
4.7
..
..
..
..

H - Services % GDP
37.76
38.86
36.8
37.2
37.3
..
..
..
..

J - Inflation %
4.6
6.8
5.4
4.2
3
2.8
2.7
2
1.85

K - Budget Balance % GDP
-5.4
-5.6
-8.6
-6.8
-6.3
-6.4
-6.2
-6
-5.95

N - GDP $bn
3.46
3.06
2.99
2.96
2.93
2.91
2.9
2.88
2.86

O - GDP % of UK
0.24
0.21
0.21
0.19
0.18
0.17
0.16
0.15
0.15

P - GDP % of US
0.04
0.03
0.03
0.03
0.03
0.03
0.02
0.02
0.02

Q - GDP Per Capita $
431
371
351
343
340
336
333
330
326

R - GDP Per Capita % of UK
1.75
1.54
1.48
1.34
1.25
1.2
1.12
1.06
1.01

S - GDP Per Capita % of US
1.27
1.06
0.99
0.95
0.91
0.88
0.85
0.82
0.8

T - Population m
7.25
7.42
7.58
7.74
7.91
8.07
8.24
8.4
8.57

External Data

X - $ to Currency
1380
1880
1960
2047
2100
2200
2300
2376.5
2476.5

AA - Exports $m
636
666
731
808
873
954
1010
1083
1151

AB - Export Growth %, y-on-y
-8.27
4.83
9.69
10.53
8.04
9.28
5.87
7.23
6.33

AC - Imports $m
-582
-587
-562
-599
-639
-691
-745
-791
-844

AD - Import Growth %, y-on-y
1.72
0.91
-4.31
6.62
6.68
8.14
7.81
6.17
6.7

AE - Trade Balance $m
53.9
79.3
169.2
209
234
263
265
292
307.5

AF - Total Export Earnings $m
774
758
825
899
962
1022
1111
1172
1247

AG - Current Account Balance $m
-215
-155
-101
-77
-55
-38
-50
-31
-28

AH - Current Account % GDP
-6.21
-5.06
-3.38
-2.6
-1.88
-1.31
-1.72
-1.06
-0.98

AJ - Capital Account Balance $m
117
8
11
15
17
23
25
29
33

AK - Reserves (minus gold) $m
199.68
147.91
200.23
156
124
110
103
80
69.5

AL - Reserve Import Cover - Months
4.12
3.02
4.28
3.13
2.33
1.91
1.66
1.21
0.99

AM - Foreign Direct Investment $m
63
10
12
23
31
22
19
19
13

AN - Foreign Direct Investment % GDP
1.83
0.32
0.4
0.78
1.06
0.76
0.66
0.64
0.44

AO - Total External Debt $m
3522
3388
3276
3214
3146
3112
3064
3013
2972

AP - Short Term Debt $m
334
335
339
346
351
356
363
368
374

AQ - Total Debt Service $m
128
133
156
179
157
134
138
116
106

AR - Total Debt % GDP
101.76
110.61
109.6
108.58
107.37
106.94
105.66
104.8
103.92

AS - Debt Service Ratio % Total Exports
16.55
17.55
18.91
19.91
16.32
13.11
12.42
9.85
8.5

AT - Total Debt % Total Exports
455.33
447.02
397.09
357.51
327.03
304.5
275.79
256.97
238.33

AU - Short Term Debt % Total Debt
9.48
9.89
10.35
10.77
11.16
11.44
11.85
12.21
12.58

AV - Short Term Debt % Reserves
167.27
226.49
169.3
221.79
283.06
323.64
352.43
460
538.13

AW - Interest Payment Arrears $m
106
118
..
..
..
..
..
..
..

AX - Grants $m
158
112
..
..
..
..
..
..
..

AY - Debt Forgiveness + Rescheduling $m
4
0
..
..
..
..
..
..
..

AZ - External Assets $m
255
273
286
296
305
410
417
474
530

BA - External Liquidity Gap % Total Exports
64.58
58.36
48.31
42.82
38.54
34.41
33.41
30.31
28.59

Notes: J - (aop) average over period K - Including official transfers N - US$ to Guinea Franc, end of period AG - Including official transfers
Sources : IMF, World Bank Forecasts : World Markets Online

Current Highlights Diagrams

Statistics Poorly Collated and Unreliable: The IMF is currently offering the government of Guinea guidance on improving its data collection and analysis systems.
Foundations Laid For Sustained Growth and Development: The very early foundations necessary for attaining macro-economic stability have been laid. Deep imbalances in the economy remain - in particular, the tax and revenue collection systems are in need of a major overhaul. Nevertheless, the IMF is displaying a new confidence in the Guinean government that promises better things to come.
70% Discount on Debt to Russia Agreed: Russia has agreed to a 70% discount on all monies outstanding that were secured in the pre-1992 period. As a former Marxist state, Guinea holds a considerable amount of debt with Russia, which took on the debts of the former USSR. One third of Guinea's debts are held by Russia.
Current Account Brought Into Negative By Debt Burden: Despite a favourable trade balance, where exports outstrip imports by 38% (in 2000), Guinea's high debt burden brings the current account into deficit.
Debt Has Not Been Consolidated, Though Disbursements Have Been Made: It is unusual for the IMF to disburse monies to countries before debts and arrears have been consolidated. Guinea has not consolidated its debt, but the IMF is dispersing funds. HIPC debt relief began in January 2001. In May 2001, an US$82m Poverty Reduction and Growth Facility (PRGF) was approved to foster Guinea's efforts towards attaining macro-economic stability.

Economic Performance and Prospects

GDP Growth. Guinea has maintained surprisingly impressive GDP growth figures, which can be partly attributed to increased gold production since 1995 and improved relations with the donor community. However, after an IMF visit in 2001, growth in 2000 was thought to have fallen far short of original projections, down from 4.5% to 1.8% growth. This weakened position was attributed to higher than anticipated oil prices and the continued depreciation of the Guinean franc.
Inflation. Inflation has been contained by the government, remaining in single digits since 1996. Shocks aside, inflation can be expected to remain low throughout the forecast period.
Current Account. he current account has been persistently running at a deficit as a result of Guinea's high debt burden. The benefits of a favourable trade balance, where exports outstrip imports by 38% (in 2000), have been lost through high debt servicing.

Macro-Economic Policies etc...

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Guinea. Economic analysis

Guinea analysis. Economic environment