105. Equitorial Guinea - First World Country in Africa....!!

Updated: Jun 28, 2021

Why Equitorial Guinea is Special in Africa ?

Equatorial Guinea Aka Spanish Guinea is a country on the west coast of Central Africa, with an area of 28,000 square kilometres (11,000 sq mi). Formerly the colony of Spanish Guinea, its post-independence name evokes its location near both the Equator and the Gulf of Guinea. As of 2015, the country had a population of 1,225,367.

Equatorial Guinea consists of two parts, an insular and a mainland region. The insular region consists of the islands of Bioko (formerly Fernando Pó) in the Gulf of Guinea and Annobón, a small volcanic island which is the only part of the country south of the equator. Bioko Island is the northernmost part of Equatorial Guinea and is the site of the country's capital, Malabo.

Pic : Malabo, Capital City of Equitorial Guinea

The Portuguese-speaking island nation of São Tomé and Príncipe is located between Bioko and Annobón. The mainland region, Río Muni, is bordered by Cameroon on the north and Gabon on the south and east. It is the location of Bata, Equatorial Guinea's largest city, and Ciudad de la Paz, the country's planned future capital. Rio Muni also includes several small offshore islands, such as Corisco, Elobey Grande, and Elobey Chico. The country is a member of the African Union, Francophonie, OPEC and the CPLP.

After becoming independent from Spain in 1968, Equatorial Guinea was ruled by President for life Francisco Macías Nguema until he was overthrown in a coup in 1979 by his nephew Teodoro Obiang Nguema Mbasogo who has served as the country's president since. Both presidents have been widely characterized as dictators by foreign observers. Since the mid-1990s, Equatorial Guinea has become one of sub-Saharan Africa's largest oil producers.

It has subsequently become the richest country per capita in Africa, and its gross domestic product (GDP) adjusted for purchasing power parity (PPP) per capita ranks 43rd in the world; however, the wealth is distributed extremely unevenly, with few people benefiting from the oil riches. The country ranks 144th on the 2019 Human Development Index,with less than half the population having access to clean drinking water and about 10% of children dying before the age of five.

Equatorial Guinea's government is authoritarian and has one of the worst human rights records in the world, consistently ranking among the "worst of the worst" in Freedom House's annual survey of political and civil rights. Reporters Without Borders ranks President Obiang among its "predators" of press freedom. Human trafficking is a significant problem with the U.S. Trafficking in Persons Report identifying Equatorial Guinea as a source and destination country for forced labour and sex trafficking. The report also noted that Equatorial Guinea "does not fully meet the minimum standards for the elimination of trafficking but is making significant efforts to do so."

I. Economic Overview

The country has been one of the fastest growing economies in Africa in the past decade. After the discovery of large oil reserves in the 1990s, Equatorial Guinea became the third-largest producer of oil in Sub-Saharan Africa, after Nigeria and Angola. More recently, substantial gas reserves have also been discovered. However, the country macroeconomic and fiscal situation has deteriorated following the oil price drop.

EQG ( Equitorial Guinea ) experienced the full extent of the Central Africa Economic and Monetary Community (CEMAC) crisis because of its large dependence on oil exports and lack of sufficient buffers, such as government deposits and international reserves and while it has announced plans for adjustment is has not yet reached an agreement with the International Monetary Fund (IMF).

Pic : Obiang and U.S. president Obama with their wives in 2014

The government’s development agenda is guided by a medium-term strategy paper, the National Economic Development Plan: Horizon 2020, which targets economic diversification and poverty reduction. The first phase of Horizon 2020 focused on infrastructure development was concluded in 2012. The second phase will focus on economic diversification, targeting strategic new sectors such as fisheries, agriculture, tourism and finance.

Equatorial Guinea is among the countries worst hit by the Central African Economic Monetary Community (CEMAC) crisis which started in 2014, facing twin deficits and a rapid loss of international reserves stemming from dependence on oil exports, lack of sufficient buffers, and weak public financial management (PFM) procedures.

To restore its external and fiscal imbalances, Equatorial Guinea is undertaking several reforms and has entered into an IMF Staff Monitored Program (SMP) in May 2018. The reforms include raising non-hydrocarbon tax revenues and reducing the non-hydrocarbon primary deficit, improving PFM in coordination with the other CEMAC countries, supporting social sectors, protecting the banking sector through the non-accumulation of new arrears, and improving governance.

EQG became member of Organization of the Petroleum Exporting Countries (OPEC) in May 2017. For the government, joining OPEC could be an attempt to bolster foreign investment and technology transfers from other member countries, especially from the Gulf.

Pic : Airport

II. Overview Of The Economy Of Equatorial Guinea

Before independence, the country relied on cocoa production for hard currency earnings. The discovery and exploration of oil deposits have contributed to a significant increase in government revenue. Equatorial Guinea is one of the major oil producers in Sub-Saharan Africa, producing approximately 360,000 barrels per day (2004). Other major components of the GDP include farming, forestry, and fishing. Equatorial Guinea also has other unexploited natural resources including fertile soil, tropical climate, water resources, and labor sources. The country has a little industry and market for industrial products are also small. Here are some of the biggest industries in Equatorial Guinea.

1. Petroleum Industry

Oil and gas extraction dominates the economy of Equatorial Guinea and accounts for approximately 90% of the country’s GDP. The country was ranked the third largest producer of oil in Sub-Saharan Africa behind Angola and Nigeria. However, despite the oil sector being the largest in the country, it only accounts for 4% of the total jobs. The low employment capacity is attributed to the presence of large multinational players in the sector. Equatorial Guinea produces 289,000 barrels of oil per day (2015) down from 358,000 barrels per day in 2005.

The decrease in production is as a result of the fall in oil prices in 2014. With a reserve of 1.1 billion barrels, the country is expected to run out of oil in the next ten years. However, there is ongoing development of the existing commercially viable oil deposits and exploration for new deposit in the country. Equatorial Guinea is the 109th largest export economy in the world. In 2017, it shipped goods worth US$ 4.72 billion around the globe.Crude petroleum accounted for 66.5% of the total export value while petroleum gas accounted for 19.8% of the export value. It exports its petroleum product to China, South Korea, Portugal, and India.

2. Farming Industry

Agriculture is also one of the main sectors of Equatorial Guinea’s economy, accounting for approximately 2% of the GDP. While its proportion compared to the oil industry is lower, the sector plays a major role in local and foreign earnings. The share of the sector has shown considerable growth in recent years compared to the previous decades when it averaged less than 1% of the GDP. Because the oil industry is dominated by the foreign multinational company, the majority of the population depend on agriculture. An estimated 8% of the total land is engaged in crop production.

The agricultural sector has historically been known for cocoa production, with the country producing over 36,000 tons of cocoa in the 1960s. However, production has since dropped to only 4,800 tons. Cocoa is not the only prominent crop in the country. Another marginal cash crop is the coffee which does well in the country because of the tropical climate. The island of Bioko is particularly favorable for coffee and cocoa farming. Food crops are such as cassava, sweet potato, and banana are mainly cultivated in Rio Muni. Although agriculture is an important part of the country’s economy, it contributes very little to the export earnings.

3. Fishing Industry

With a coastline of approximately 644 kilometers and an exclusive economic zone of 314,000 square miles, Equatorial Guinea has a wide variety of marine species. Fishing in the country is both industrial and artisanal. The fishing industry was one of the largest industries in the country in the 1980s before the discovery of large oil and gas fields. Today, it remains one of the largest sources of income for most households living along the coast. According to “The Value of African Fisheries” study, about 4,200 people are directly involved in fishing in Equatorial Guinea and another 10,000 are involved in fish processing.

In 2013, a total of 8,600 tons of fish was caught including 1,000 tons of inland catch. Over the years, the country has averaged 1,500 to 3,100 tons of tuna every year by the industrial fleets. According to FAO, the country’s annual per capita fish consumption in the country is 25.9 kilograms and contributes approximately 40% of the animal protein and supply 23% of the total protein supply in the country.

4. Forest Industry

Timber is one of Equatorial Guinea’s leading exports, only second to oil export with rough wood accounting for 5.3% of the export earnings. The country’s forest covers approximately 62% of the total land area. Timber production increased steadily in the 1990s, with the wood export reaching a record 790,000 cubic meters in 1999. Timber is mainly produced in Rio Muni (mainland) with 97% of the harvest meant for export and the rest processed locally. The area produces mainly okoume and akoga from the rainforest. Like almost all the industries in the country, the major challenge facing the forest industry is the lack of a well-developed infrastructure.

Pic : Indian President Ramnath Kovind visiting Equitorial Guinea.

5. Tourism Industry

Fancy a holiday on which you could explore pristine rainforest buzzing with rare wildlife, doze on idyllic beaches where crystalline waters lap sands soaked in history, and admire unique colonial architecture frozen in time?

Of all the places that might come to mind – Bali, Thailand, the Caribbean perhaps – the small central African nation of Equatorial Guinea, by some accounts the world’s sixth-least visited country, would probably be among the last.

One of Africa’s most closed countries offers just such lures, however, and has become the latest seeking to boost tourism, an increasingly important sector that is moving beyond the cliches of safari parks and skint backpackers.

The added bonus is that you would have the place largely to yourself. Until recently it was cut off from the world by decades of dictatorship.

Best known for a botched coup attempt by Mark Thatcher and the mercenary Simon Mann, and the profligacy of the Obiang family which has ruled since independence in 1968, the country is also home to plenty of hidden gems to lure intrepid travellers.

“There are incredibly isolated beaches where you feel like Indiana Jones,” said Oscar Scafidi, who authored the first English-language guidebook for Equatorial Guinea, which will be launched on 4 November.

“There’s an incredible sort of mini Dubai being built in the middle of the jungle, and on the other hand it’s a paradise if you’re into animals – western lowland gorillas, forest elephants and a sea wildlife unique to the area.”