Economy - overview:
Exploitation of oil and gas deposits, beginning in the 1990s, has driven economic growth in Equatorial Guinea; a recent rebasing of GDP resulted in an upward revision of the size of the economy by approximately 30%. Forestry and farming are minor components of GDP. Although preindependence Equatorial Guinea counted on cocoa production for hard currency earnings, the neglect of the rural economy since independence has diminished the potential for agriculture-led growth. Subsistence farming is the dominant form of livelihood. Declining revenue from hydrocarbon production, high levels of infrastructure expenditures, lack of economic diversification, and corruption have pushed the economy into decline in recent years and limited improvements in the general population’s living conditions. Equatorial Guinea’s real GDP growth has been weak in recent years, averaging -0.5% per year from 2010 to 2014, because of a declining hydrocarbon sector. Inflation remained very low in 2016, down from an average of 4% in 2014.
As a middle income country, Equatorial Guinea is now ineligible for most low-income World Bank and the IMF funding. The government has been widely criticized for its lack of transparency and misuse of oil revenues and has attempted to address this issue by working toward compliance with the Extractive Industries Transparency Initiative. US foreign assistance to Equatorial Guinea is limited in part because of US restrictions pursuant to the Trafficking Victims Protection Act.
Equatorial Guinea hosted two economic diversification symposia in 2014 that focused on attracting investment in five sectors: agriculture and animal ranching, fishing, mining and petrochemicals, tourism, and financial services. Undeveloped mineral resources include gold, zinc, diamonds, columbite-tantalite, and other base metals. In 2017 Equatorial Guinea signed a preliminary agreement with Ghana to sell liquefied natural gas (LNG); as oil production wanes, the government believes LNG could provide a boost to revenues, but it will require large investments and long lead times to develop.
Definition: This entry briefly describes five economic components for a given country:
* National Economy, including a brief economic history;
* Domestic Markets, including labor and wage markets as well as brief commentary on economic sector portfolios;
* Financial Power and Public Finance, including brief discussions of financial market strengths and security, lending/exchange rates (especially if abnormalities exist), and foreign direct investments;
* Trade Power and Influence, including brief commentary on chief imports and exports; and
* Regional Strategy and Efforts, including key partners, regional economic development efforts, and any underlying economic data integrity concerns.
Source: CIA World Factbook - This page was last updated on Saturday, September 18, 2021
