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- GDP (PPP):
- $15.0 billion
- 0.1% growth
- 2.2% 5-year compound annual growth
- $1,214 per capita
- Inflation (CPI):
- FDI Inflow:
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.
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.
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.
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.
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.
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.