2017 Index of Economic Freedom

Guinea

overall score47.6
world rank169
Rule of Law

Property Rights15.6

Government Integrity27.5

Judicial Effectiveness13.1

Government Size

Government Spending78.4

Tax Burden69.1

Fiscal Health34.2

Regulatory Efficiency

Business Freedom55.8

Labor Freedom54.8

Monetary Freedom71.1

Open Markets

Trade Freedom61.2

Investment Freedom50.0

Financial Freedom40.0

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Quick Facts
  • Population:
    • 11.7 million
  • GDP (PPP):
    • $15.0 billion
    • 0.1% growth
    • 2.2% 5-year compound annual growth
    • $1,214 per capita
  • Unemployment:
    • 1.8%
  • Inflation (CPI):
    • 8.2%
  • FDI Inflow:
    • $85.0 million
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Advancement of economic freedom in Guinea has been uneven. Dynamic gains from relatively high openness to global trade are largely undercut by lack of progress in improving the investment regime and regulatory efficiency. The lack of a consistent commitment to structural reform continues to prevent more dynamic investment in the mining sector.

Guinea has lagged notably in promoting the effective rule of law. The judicial system remains vulnerable to political interference, and property rights are not strongly protected. Lingering corruption further undermines judicial effectiveness and government integrity, impeding more vibrant private-sector economic activity.

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Background

In 2010, Alpha Condé won Guinea’s first presidential election since independence from France in 1958, but the election was marred by irregularities and political violence. Condé’s Rally of the Guinean People won a majority of seats in flawed parliamentary elections in 2013, and Condé easily won a second five-year term in October 2015 in elections boycotted by the opposition. The 2014 West Africa Ebola outbreak badly damaged Guinea’s health care system and economy. An ambitious recovery plan unveiled by the government in 2015 includes measures designed to rebuild the health care system and the country’s infrastructure, diversify the economy, and improve governance. Guinea has two-thirds of the world’s bauxite reserves and large deposits of iron ore, gold, and diamonds.

Rule of LawView Methodology

Property Rights 15.6 Create a Graph using this measurement

Government Integrity 27.5 Create a Graph using this measurement

Judicial Effectiveness 13.1 Create a Graph using this measurement

Both foreigners and citizens have the right to own property and businesses. However, enforcement of these rights depends on a corrupt and inefficient legal and administrative system. In addition, land sales and business contracts generally lack transparency. Public institutions are characterized by a pervasive culture of impunity and corruption.

Government SizeView Methodology

The top personal income tax rate is 40 percent, and the top corporate tax rate is 35 percent. Other taxes include a value-added tax and an inheritance tax. The overall tax burden equals 16.2 percent of total domestic income. Government spending has amounted to 26.8 percent of total output (GDP) over the past three years, and budget deficits have averaged 6.2 percent of GDP. Public debt is equivalent to 48.4 percent of GDP.

Regulatory EfficiencyView Methodology

Private enterprises face numerous hurdles in incorporating and operating. The labor market remains underdeveloped, and the public sector still accounts for most formal employment. With inflation easing in 2016 due to lower world food and oil prices, the government resisted populist pressure to increase domestic fuel subsidies but delayed implementation of a planned automatic fuel pricing mechanism.

Open MarketsView Methodology

Trade is important to Guinea’s economy; the value of exports and imports taken together equals 78 percent of GDP. The average applied tariff rate is 11.9 percent. The judicial and regulatory systems may impede foreign investment. The underdeveloped financial sector continues to provide a very limited range of services. Many people still rely on informal lending and have no bank accounts.

Country's Score Over Time

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Regional Ranking

rank country overall change
1Mauritius74.70.0
2Botswana70.1-1.0
3Rwanda67.64.5
4Côte d'Ivoire 633.0
5Namibia62.50.6
6South Africa62.30.4
7Seychelles61.8-0.4
8Swaziland61.11.4
9Uganda60.91.6
10Burkina Faso59.60.5
11Benin59.2-0.1
12Mali58.62.1
13Gabon58.6-0.4
14Tanzania58.60.1
15Madagascar57.4-3.7
16Nigeria57.1-0.4
17Cabo Verde56.9-9.6
18Democratic Republic of Congo56.410.0
19Ghana56.2-6.8
20Guinea-Bissau56.14.3
21Senegal55.9-2.2
22Comoros55.83.4
23Zambia55.8-3.0
24São Tomé and Príncipe 55.4-1.3
25Mauritania54.4-0.4
26Lesotho53.93.3
27Kenya53.5-4.0
28The Gambia53.4-3.7
29Togo53.2-0.4
30Burundi53.2-0.7
31Ethiopia52.71.2
32Sierra Leone52.60.3
33Malawi52.20.4
34Cameroon51.8-2.4
35Central African Republic51.86.6
36Niger50.8-3.5
37Mozambique 49.9-3.3
38Liberia49.1-3.1
39Chad492.7
40Sudan48.8N/A
41Angola48.5-0.4
42Guinea47.6-5.7
43Djibouti46.7-9.3
44Equatorial Guinea451.3
45Zimbabwe445.8
46Eritrea42.2-0.5
47Republic of Congo 40-2.8
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