Guinea – 2015 will be another difficult one for the Guinean economy, reflecting the Ebola outbreak which is still not fully under control, sharply lower commodity prices, and the political uncertainty ahead of the presidential elections.
“We expect growth to be nil on average in 2015. Little, if any, output expansion seems likely this year,” the International Monetary Fund (IMF) has said in a statement following a mission to Conakry between April 23 and May 8, 2015.
The aim of the mission was to conduct discussions on the sixth review of the authorities program supported by an arrangement under the Extended Credit Facility (ECF).
As a result, of the Ebola outbreak in Guinea in 2014, economic growth slowed to 1.1%, despite agricultural production growing strongly.
Macroeconomic stability was maintained thanks to sound policies helped by stepped up international support to fight the Ebola outbreak, while inflation declined to 8.5% in March 2015 and the Central Bank’s international reserves remained at safe levels.
The Guinean franc depreciated slightly against the US dollar, but strengthened against the euro. All the performance criteria and indicative targets for end-2014 under the ECF arrangement were met, however several indicative for end-March 2015 were missed, reflecting increased pressure on the budget, the IFM reports.
The IMF says that although authorities continued to implement their structural reform agenda, difficulties in securing technical assistance have slowed the pace of reforms.
The mission encouraged the authorities to implement revenue-enhancing measures to contain the fiscal deficit as well as enhance the transparency of the public investment program. The IMF team signaled the importance of additional financial assistance from the international community to support the authorities’ adjustment efforts and essential priority expenditure.
The IMF remain committed to the ECF-supported reform agenda aimed at strengthening public financial management, improving the business environment, bolstering the productivity of the public sector, strengthening the electricity sector, and finalising the transformation of the mining sector’s institutional and legal environment.
The mission to Conakry welcomed the adoption of the draft law on public enterprises that will help control budgetary risks.