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Country Report Equatorial Guinea January 2012

  • Publication Date:January 2012
  • Publisher:EIU
  • Product Type: Report
  • Pages:24

Country Report Equatorial Guinea January 2012

Outlook for 2012-16

  • The major threat to political stability in 2012-16 would be if the elderly president, Teodoro Obiang Nguema Mbasogo, left office suddenly, owing either to ill health or a coup, which could create a destabilising power contest.
  • Policy in 2012-16 will be guided in principle by the government's medium-term strategy paper, the National Economic Development Plan: Horizon 2020, which targets economic diversification and poverty reduction.
  • The difficult business environment, which constrains private-sector investment, is expected to persist; in particular, corruption among officials will remain rampant.
  • Underpinned by rising hydrocarbons output for most of the forecast period, the Economist Intelligence Unit expects the fiscal account to remain in surplus, as oil and gas receipts form the bulk of government revenue.
  • The earlier than expected commencement of output from the Aseng oilfield will boost 2012 GDP growth to 6.8%. Growth will remain robust in 2013-14, before slowing in 2015-16 on the back of a lull in new oilfield start-ups.
  • Despite the weaker outlook for the CFA franc in the first part of the forecast period, subdued global commodity prices will help to reduce average annual inflation to 5.6% in 2012-16.
  • Given our forecasts for GDP growth and the oil sector, we expect the current-account deficit to average 5.1% of GDP in 2012-14, rising to 7.9% of GDP in 2015-16.

Monthly review

  • Mr Obiang Nguema paid a surprise visit to Zimbabwe on January 9th. The purpose of his stopover in Harare was not entirely clear, although the president claimed that it was simply to strengthen bilateral co-operation.
  • Ahead of the Africa Cup of Nations soccer tournament-which is due to start on January 21st-the authorities are urging banks to increase the number of cash-dispensing machines and foreign-exchange offices.
  • As part of the government's efforts to promote Equatorial Guinea as a tourist destination, Mr Obiang Nguema inaugurated a new resort in the coastal city of Bata in late December.
  • A Spanish oil company, Repsol YPF, has announced that it is discontinuing its exploration of Block C-1, after concluding that the project is not economically viable.
  • A Norwegian-based company, Seadrill, has been enlisted by Hess Corporation of the US for an eight-well drilling contract, starting in 2013.

This report covers the following industry codes:
SIC Code: 49
NAICS Code: 22

Please Note: Due to the Nature of This Report The Toc is Not Available

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