Country FilesCentralCountry Profile 2014: EQUATORIAL GUINEA

Fri,24Nov2017

Posted on Friday, 07 February 2014 17:03

Country Profile 2014: EQUATORIAL GUINEA

Oiling the merry-go-round

Oil accounts for about 75% of the country’s gross domestic product, and as such the economy experiences frequent ups and downs due to changes in production and market prices. In the early 2000s, Equatorial Guinea became sub-Saharan Africa’s third-largest oil producer, enabling the government to develop infrastructure rapidly. Oil also facilitates the longevity of the regime of President Teodoro Obiang Nguema Mbasogo, who is not set to face another election until 2016.

 

 

TABLE OF CONTENTS:

TOP GUINEAN COMPANIES

TOP GUINEAN BANKS

ar-infographie-equatorial-guinea-2014Oiling the merry-go-round

Gas production is beginning to replace oil in importance to the economy

President Obiang and his family enjoy monopoly control of political power

Oil accounts for about 75% of the country’s gross domestic product, and as such the economy experiences frequent ups and downs due to changes in production and market prices. In the early 2000s, Equatorial Guinea became sub-Saharan Africa’s third-largest oil producer, enabling the government to develop infrastructure rapidly. Oil also facilitates the longevity of the regime of President Teodoro Obiang Nguema Mbasogo, who is not set to face another election until 2016.

Oil production was on an upward trend after hitting 318,000 barrels per day(bpd) in 2012. The Alen gas condensate field began production in July 2013. United Kingdom-based Ophir Energy estimates that Block R contains at least 10bn ft! of natural gas, but it will not begin production until 2017 or 2018. The government wants companies to build a second liquefied natural gas plant and a petrochemicals industry. Older oil fields are being depleted, and the government signed new licences with mostly junior companies in April 2013. The government plans to issue licences for eight new blocks in 2014.

SLOW TRANSFORMATION

The government is using its revenue from the oil and gas sectors to build roads, schools, hospitals, government buildings, social housing, airports and ports. Chinese contractors are carrying out most of the projects,but they have yet to transform the economy. Poverty levels are stubborn, and health and education are not progressing rapidly.

The country plans to generate 561MW of electricity by 2017, up from 101MW in 2010.The Sendje dam is the next hydroelectric project due to be commissioned and is likely to be operational in 2015. The government is considering electricity exports to Gabon and Cameroon. It seeks to diversify the economy by 2020, but oil and gas are the only areas that have attracted major foreign investment.

Businesses do not complain about corruption publicly, but industry sources say that irregular business practices are the reason France’s Société Générale has been trying to sell its 52.24% stake in Société Générale de Banques en Guinée Equatoriale since early 2013. The state holds a 30% share in the bank. In 2013, Grupo Francisco Hernando Contreras, Hess and Tullow brought cases against the government to the World Bank’s International Centre for Settlement of Investment Disputes. The government says that it is committed to fighting corruption and will create a social and economic council and an auditing office in 2014. A referendum in November 2011 approved a new constitution and the creation of those two bodies.

NO SPACE FOR OPPOSITION

Obiang has been in power since 1979 and shows no sign of retiring. Under his regime there is little political space for the opposition. The government did not allow the Convergencia para la Democracia Social (CPDS), led by Plácido Micó Abogo, to organise public meetings to protest the management of the May 2013 legislative elections. The CPDS won one seat each in the national assembly and the senate. The authorities detained political activist Clara Nsegue Eyí without charge from May until October after she attempted to set up a political party in Obiang’s home town of Mongomo. The government also cut off access to opposition and social media sites a head of the polls.

Most of the political class is convinced that Obiang, 71, is preparing for his son Teodoro Nguema Obiang Mangue to succeed him. The younger Obiang is second vice-president in charge of defence and security, a position that does not exist under the current constitution. Despite some legal victories in 2013, he faces the prospect of new corruption charges in the United States and a continuing investigation in France in 2014.

The government is also using its oil money to win allies. In May 2013, it offered the government of Liberia a financial package to build low-cost housing and rehabilitate Monrovia’s airport. In March, the governments in Malabo and Accra signed an updated cooperation agreement for the sharing of expertise in the natural gas sector. Obiang announced the country’s withdrawal from the International Criminal Court on 18 October because of its “humiliating and irrational”prosecution of Kenya’s President Uhuru Kenyatta.

TOP GUINEAN COMPANIES

No companies from EQUATORIAL GUINEA featured in The Africa's Report's Top 500 Companies in Africa 2013.

 

TOP GUINEAN BANKS

Rank 2012Rank 2011Bank nameCountryTotal assetsNet interest incomeLoansDeposits
122117CCEI BANK GEEQ. GUINEA1,282,946112,7801,025,121951,366
178140SOC. GN. DE BANQ. EN GUINE EQUATORIALEEQ. GUINEA573,54231,872133,979515,800
 


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