Economy of Guinea
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Guinea is richly endowed with minerals, possessing an estimated one-third of the world's proven reserves of bauxite, more than 1.8 billion metric tons of high-grade iron ore, significant diamond and gold deposits, and undetermined quantities of uranium. Guinea also has considerable potential for growth in the agricultural and fishing sectors. Land, water, and climatic conditions provide opportunities for large-scale irrigated farming and agroindustry.
Bauxite mining and alumina production provide about 80% of Guinea's foreign exchange. Several U.S. companies are active in this sector. Diamonds and gold also are mined and exported on a large scale, providing additional foreign exchange. Concession agreements have been signed for future exploitation of Guinea's extensive iron ore deposits. Remittances from Guineans living and working abroad and coffee exports account for the rest of Guinea's foreign exchange.
Since 1985, the Guinean Government has adopted policies to return commercial activity to the private sector, promote investment, reduce the role of the state in the economy, and improve the administrative and judicial framework. The government has eliminated restrictions on agricultural enterprise and foreign trade, liquidated many parastatals, increased spending on education, and vastly downsized the civil service. The government also has made major strides in restructuring the public finances. The IMF and the World Bank are heavily involved in the development of Guinea's economy, as are many bilateral donor nations, including the United States. Guinea's economic reforms have had recent notable success, improving the rate of economic to 5% and reducing the rate of inflation to about 2%, as well as increasing government revenues while restraining official expenditures. Although Guinea's external debt burden remains high, the country is now current on external debt payments.
The government revised the private investment code in 1998 to stimulate economic activity in the spirit of a free enterprise. The code does not discriminate between foreigners and nationals and provides for repatriation of profits. Foreign investments outside Conakry are entitled to especially favorable conditions. A national investment commission has been formed to review all investment proposals. The United States and Guinea have signed an investment guarantee agreement that offers political risk insurance to American investors through OPIC. Guinea plans to inaugurate an arbitration court system to allow for the quick resolution of commercial disputes.
Guinea is richly endowed with minerals, possessing an estimated one-third of the world's proven reserves of bauxite, more than 1.8 billion metric tons (MT) of high-grade iron ore, significant diamond and gold deposits, and undetermined quantities of uranium. Guinea also has considerable potential for growth in the agricultural and fishing sectors. Land, water, and climatic conditions provide opportunities for large-scale irrigated farming and agroindustry. Possibilities for investment and commercial activities exist in all these areas, but Guinea's poorly developed infrastructure continues to present obstacles to investment projects.
Lately, with the increase of alumina demand thanks to booming China, there is a renew interest in Guinea riches. The consortium Alcan and Alcoa, partener with the Guinean government in the CBG mining in north western Guinea, have announced the feasibility study for the construction of a 1 million tpa alumina smelter. This come with a similar project from canadian start-up Global Alumina trying to come with 2 billions dollars alumina plant in the same region. As of April 2005, the National Assembly of Guinea has not ratified Global's project.
GDP: purchasing power parity - $9.2 billion (1999 est.)
GDP - real growth rate: 3.7% (1999 est.)
GDP - per capita: purchasing power parity - $1,200 (1999 est.)
GDP - composition by sector:
agriculture:
24%
industry:
31%
services:
45% (1996 est.)
Population below poverty line: NA%
Household income or consumption by percentage share:
lowest 10%:
0.9%
highest 10%:
31.7% (1991)
Inflation rate (consumer prices): 4.5% (1999 est.)
Labor force: 2.4 million (1983)
Labor force - by occupation: agriculture 80%, industry and commerce 11%, services 5.4%, civil service 3.6%
Unemployment rate: NA%
Budget:
revenues:
$553 million
expenditures:
$652 million, including capital expenditures of $317 million (1995 est.)
Industries: bauxite, gold, diamonds; alumina refining; light manufacturing and agricultural processing industries
Industrial production growth rate: 3.2% (1994)
Electricity - production: 535 GWh (1998)
Electricity - production by source:
fossil fuel:
63.55%
hydro:
36.45%
nuclear:
0%
other:
0% (1998)
Electricity - consumption: 498 GWh (1998)
Electricity - exports: 0 kWh (1998)
Electricity - imports: 0 kWh (1998)
Agriculture - products: rice, coffee, pineapples, palm kernels, cassava (tapioca), bananas, sweet potatoes; cattle, sheep, goats; timber
Exports: $695 million (f.o.b., 1998 est.)
Exports - commodities: bauxite, alumina, gold, diamonds, coffee, fish, agricultural products
Exports - partners: Russia, United States, Benelux, Ukraine, Ireland, Spain (1997)
Imports: $560 million (f.o.b., 1998 est.)
Imports - commodities: petroleum products, metals, machinery, transport equipment, textiles, grain and other foodstuffs (1997)
Imports - partners: France, Côte d'Ivoire, United States, Benelux, Hong Kong (1997)
Debt - external: $3.15 billion (1998 est.)
Economic aid - recipient: $433.6 million (1995)
Currency: 1 Guinean franc (FG) = 100 centimes
Exchange rates: Guinean francs (FG) per US$1 - 1,292.5 (January 1999), 1,236.8 (1998), 1,095.3 (1997), 1,004.0 (1996), 991.4 (1995)
Fiscal year: calendar year