Country Report Guinea December 2008

Outlook for 2009-10

The president, Lansana Conte, is expected to reassert his control over the government by introducing more conservative and loyal cabinet members, led by the prime minister, Ahmed Tidiane Souare. There is a strong possibility that protests could lead to some form of political upheaval, even a military coup, as frustration with the government, which is blamed for falling living standards, is high. Wide-ranging fiscal, monetary, economic and political reforms have now in effect come to an end, and the poverty reduction and growth facility (PRGF, July 2007-June 2010) is expected to go off track. Falling international oil and food prices will help average inflation to moderate from 30% in 2008 to 25% in 2009 and 22% in 2010. The current-account deficit will narrow from 10.9% of GDP in 2008 to 7.8% in 2009 in line with lower imports, before expanding to 8% of GDP as imports recover slightly and exports decline.

The political scene

The minister of economy and finance, Ousmane Dore, and the minister of security and civil protection, Mohamed Damba, have been sacked, continuing the ousting of the remaining ministers from the previous cabinet of the former prime minister, Lansana Kouyate. Legislative elections have once again been postponed, until at least March 2009, owing to difficulties in completing the voter registration exercise on time and insufficient financial and other resources. Protests in many parts of the country over the lack of basic services, the high cost of many goods and low pay have left at least eight people dead and scores injured. Guinea's 50th anniversary of independence has been met with much public cynicism over the current state of the country. Guinea's increasing role as a hub for international drug trafficking has been highlighted by a drug raid on the northern town of Boke.

Economic policy

An IMF mission to Guinea has given a positive review of the country's performance under the current PRGF, although this largely covers the period when Mr Kouyate was still in power and driving a reformist agenda.

The domestic economy

Talks between a mining company, Rio Tinto, and the government over the cancellation of its mining concession for the iron ore deposits at Simandou in remote south-eastern Guinea have proved inconclusive.

Foreign trade and payments

The African Development Bank has approved US$18.7m in financing for an electricity project in the capital, Conakry, and the World Bank has announced US$10m in funding for the education sector in Guinea.

This report covers the following industry codes:
SIC Code: 82;47;49;1;60;10;70;15
NAICS Code: 61;48;22;11;52;212;72;23