Economy of Guinea

The economy of Guinea is still damaged by the mismanagement of Sékou Touré, which lasted until the 1980s. It led to a complete halt of the infrastructure, as well as, most enterprises in state ownership. 1984 was begun a market-based exchange rate system to build and privatize all state-owned enterprises either or dissolve. This resulted in a strong growth in the construction industry and an increasing activity of small traders. From 2000, however, the government began to suppress further reforms, which primarily an increase in corruption result ( Transparency International 2010: Rank 164 out of 178). According bad the investment climate ( number 179 of 183 countries according to a World Bank study ). Economic growth in 2005 was 3.3%, falling to 1.5 % in 2007, but increased to 2011 again. In the same period, the inflation of over 30 (2006) to approximately 16% (2011) could be reduced. The gross domestic product amounted in 2007 to $ 4.564 billion. However, the information about it vary greatly, depending on whether it is based on real purchasing power or the official exchange rate.

Basic Information

Some indicators of the economy of Guinea:

• Share of economic sectors in the economy (2011): Agriculture: 17 %, although there 76 % of the active population were employed
• Industry including mining: 53%
• Services: 30 %

Agriculture

Despite good natural conditions, agriculture is not productive: Most small family farms working with traditional farming methods. The slash and burn is still widely used. Less than 5% of the soil are cultivated. Food production is not sufficient once for their own use.

Staple food is rice. Although rice production could be doubled within ten years to 2004, large amounts need to be imported from rice. More important basic food are cassava, fonio, sweet potato, peanut and corn.

Important agricultural products that are exported are coffee, palm oil, bananas, pineapples, cocoa and cotton. The export of food accounts for only about 2 % of exports of Guinea.

The meat production is not enough for their own needs. The fishing, however, is rapidly growing in importance and now reached levels up to 100,000 tons per year.

Mining

Few African countries have so many natural resources such as Guinea. Although they provide about 85 % ( 2004) of the export earnings of the country's mining provides few jobs.

• Bauxite: Bauxite reserves of Guinea is estimated at about 10 billion tonnes. That's almost half the world's reserves. The largest coal mining site in the world for bauxite is located in Boké. Although the country is the second largest supplier of bauxite, it produces only 2% of the aluminate due to power shortage.
• Diamond: The diamond deposits are estimated at 25 million carats, they are mainly in forest Guinea and are degraded by both small businesses as well as large industrial companies such as De Beers from South Africa.
• Iron Ore: Guinea has large iron ore deposits, but there are because of poor transport links currently only open pit. 2011, a contract between the African Iron Ore Group Limited ( AIOG ) and the state mining company, Société du Patrimoine Minier Guinéenne ( SOGUIPAMI ) on the infrastructural development of the Simandou iron ore region was completed. The project envisages the construction of a 650 km long railway line and a deepwater port, and investment in the energy sector and obvious aim of the Chinese market. The cost is estimated at U.S. $ 10 billion.
• Gold: Gold from Guinea was estimated in the 17th century in London and marked coins from it. Therefore one has it then called " Guinea ". Between 1929 and 1958, France officially based 1 million ounces of gold as a colonial power from Guinea.
• Uranium: In August 2008, the Government announced significant uranium deposits known near Firawa in the south of the country.

Industry and Energy

Industrial production grows by 7-8 % annually. Electricity production covers approximately 840 million kWh or about their own needs.

Foreign trade

Main export partners in 2011 were: Chile 24.6%, Spain 9.2%, Russia 7.5%, India 5.2%, Germany 5.2%, Ireland 5.1%, U.S. 5.0%, and the Ukraine with 4.4%. Main export products are bauxite, aluminum, gold, diamonds, coffee, fish and agricultural products. 2011 goods were exported with a value of 1.433 billion U.S. dollars.

Main import partners in 2011 were: China 13.2%, Netherlands 8.1% and the U.S. at 5.4%. Most important imported goods are petroleum products, metals, machinery, transportation equipment, textiles, grain and other foods. In 2011, imported goods worth 2.106 billion U.S. dollars.