IMF Staff Concludes Discussions On Equatorial Guinea
IMF News, October 17, 2022
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Bibliographic details
- Published: October 17, 2022
Mission context and purpose
- Press Release No. 22/355 — October 17, 2022.
- IMF staff team led by Mariana Colacelli met with Equatoguinean authorities in Washington, DC, during October 11-15, 2022.
- Discussions covered progress on Equatorial Guinea’s economic reform program supported by the extended arrangement under the Extended Fund Facility approved in 2019, commitments under the 2021 Rapid Financing Instrument, and the macroeconomic outlook and policies.
- This mission will not result in a Board discussion. End-of-Mission press releases convey preliminary findings and represent the views of IMF staff, not necessarily the IMF’s Executive Board.
Macroeconomic performance and outlook
- Real GDP:
- In the first half of 2022, real GDP rose by about 2 percent (y/y), buoyed by rising hydrocarbon output.
- 2022 real GDP growth may be lower than the 5.8 percent anticipated at the time of the July Executive Board discussion of the 2022 Article IV Consultation due to a recent incident in a large oil production unit.
- Fiscal balance and revenue:
- The overall fiscal balance improved in the first half of the year beyond staff projections, reaching 5 percent of GDP, mainly due to higher hydrocarbon revenue.
- Inflation:
- Inflation accelerated to 6.1 percent (y/y) in August, led by the increase in food prices.
- External and sectoral notes:
- The economy is benefitting from higher hydrocarbon production and prices in 2022.
Policy responses and social measures
- Food price containment:
- Government is working with foreign suppliers of basic food items to facilitate imports and plans to subsidize transportation costs to help contain local retail food prices.
- Social and human capital actions:
- Authorities recently hired about four thousand public workers, mainly for education and health and social welfare sectors, in the first-ever competitive public sector hiring process.
- Diversification and tourism:
- To support diversification and kick-start the tourism sector, the government recently hired a provider to launch an online visa portal in early 2023.
Governance, audits, and transparency progress
- Implementation of governance measures under the 2019 EFF-supported program and 2021 RFI commitments was slow due to the 2020-21 COVID-19 pandemic and Bata explosions, but recently gained momentum.
- Completed and published items:
- Final audit reports have been published on the Ministry of Finance website, including the audit of COVID-related expenses, and the audits of state-owned oil and gas companies (GEPetrol and Sonagas).
- Ongoing and forthcoming actions:
- Authorities have shared a preliminary audit report of Bata-related expenses, expected to be finalized and published soon.
- Authorities prepared a progress report on their 2019 Good Governance and Anti-Corruption Action Plan, to be published soon.
- Authorities are finalizing regulations for the asset declaration regime of public officials and for the governance of the Anti-Corruption Commission, in line with the 2021 Anti-Corruption Law.
- Authorities are working to publish contracts and beneficial ownership information of all companies awarded procurement contracts for COVID and Bata emergencies, as prescribed in the regulation adopted in December 2021.
- A website for the Official Gazette has been set up and relevant legal documents uploaded, though additional documents remain to be uploaded.
- A list of assets for privatization and a list of assets subject to other forms of private management have been approved by the Council of Ministers and published on the Ministry of Finance website, with ongoing discussions on the composition of the lists.
Domestic arrears, banking sector, and non-hydrocarbon recovery
- Implementation of the domestic arrears’ regularization plan is progressing, albeit slowly.
- Authorities have recently made progress with a first stage of the operation, but strong implementation and completion of the rest of the operation is promptly needed to help strengthen the banking sector and support non-hydrocarbon sector recovery.
Program engagement and IMF support going forward
- The 2019 EFF-supported program ends in December 2022; discussions on continued Fund program engagement are ongoing, including the authorities’ interest in a new program.
- Authorities reiterated plans to continue the structural reform agenda initiated under the 2019 EFF and to implement high-quality fiscal measures to support inclusive growth, diversification, and domestic and external stability.
- IMF technical assistance will continue to support the authorities’ economic program.
Stakeholder engagement during the mission
- The IMF team met with Minister of Finance, Economy and Planning Valentin Ela Maye Mba; State Secretary of Budget and Financial Control Antonio Ngua Mba Eyang; BEAC Second Deputy National Director Jaime Edu Andomo Obono; and other senior government officials.
- The IMF team thanked the authorities for candid and constructive discussions.
Press Release No. 22/355 — IMF Communications Department, October 17, 2022.