Equatorial Guinea: Promoting Inclusive Growth, Improving Governance and Transparency
IMF News, December 18, 2019
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Bibliographic details
- Published: December 18, 2019
Program overview
- The IMF has agreed a program with Equatorial Guinea worth around $283 million.
- Main objective: support the recovery of the country’s economy and promote sustainable and inclusive economic growth.
- Program type and duration: a three-year program under the IMF’s Extended Fund Facility (EFF).
- Core emphasis: governance and anti-corruption reforms are at the heart of the program.
Background and process
- The economy has been contracting for the past six years due to successive years of strong decline in hydrocarbon output and a contracting non-oil sector.
- The approval process took about 2½ years to conclude.
- The process began in mid-2017 and involved a staff-monitored program (SMP) agreed in 2018, which established a track record of policy implementation and opened the way to negotiations for the EFF-supported program.
Focus and policy measures
- Macroeconomic and social objectives:
- Strengthen macroeconomic and financial stability.
- Improve social protection and promote human capital development.
- Promote economic diversification and improve the business climate.
- Increase space for social spending.
- Public finance measures:
- Strengthen public finances by reducing inefficient spending.
- Increase non-resource tax revenue.
- Improve public financial management.
- Structural reforms:
- Reforms required to support economic diversification and improve the business climate.
- Measures to upgrade the anti-money laundering framework.
- Governance and transparency:
- Implementation of a "Good Governance and Anti-Corruption Action Plan" adopted and published by the authorities.
- Prior actions completed in advance of Board consideration included:
- Application to join the Extractive Industries Transparency Initiative.
- Adoption and publication of an action plan to improve transparency and governance and fight corruption.
- Establishment of a system to adequately track and control government spending.
- Presentation to parliament of a budget for 2020 that is consistent with program targets.
Anti-corruption and transparency measures (specifics)
- Adoption of an anti-corruption law covering conflicts of interest and asset declarations by senior public officials.
- Enhancements to enforcement and strengthening of international cooperation.
- Transparency measures consistent with the Extractive Industries Transparency Initiative standard, including:
- Audits of state-owned hydrocarbon companies and their publication.
- Regular publication of data and other relevant information on the hydrocarbon sector.
- Publishing beneficial ownership information for companies established in Equatorial Guinea.
Monitoring and conditionality
- IMF Board review schedule: semi-annual reviews by the Fund’s Executive Board.
- Completion of reviews will depend on program performance, notably the implementation, as agreed, of key governance and anti-corruption measures.
- The mission team will report regularly to the Fund’s Executive Board, which has taken a keen interest in the program given its governance focus.
Fast Facts (as presented)
- Real GDP growth (2019): -5.9%
- Inflation rate Q3 (2019): 1.3%
- Population: 1.36 million
- Income per capita (PPP based): $19,513
- Human Development Index rank: 141
- Life expectancy at birth: 57.9
- Expected years of schooling: 9.3
International Monetary Fund