Republic of Equatorial Guinea: Selected Issues

Publication Date:

March 25, 2009

Electronic Access:

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Summary:

This Selected Issues paper discusses fiscal sustainability and capital expenditures for Equatorial Guinea. The paper formulates a permanent income hypothesis model and estimates it using data on oil revenues from Equatorial Guinea. The first methodology is based on a standard permanent income model, using a 50-year time horizon and real rate of return of 2 percent. The paper then extends the model to incorporate a feedback effect from capital spending to non-oil GDP growth, and shows its implications for fiscal sustainability.

Series:

Country Report No. 2009/099

Subject:

English

Publication Date:

March 25, 2009

ISBN/ISSN:

9781451816020/1934-7685

Stock No:

1GNQEA2009002

Pages:

34

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