Equatorial Guinea’s economy is undergoing profound change, characterized by strong growth. However, the country is still dealing with structural and institutional problems. The country has significant growth potential in the petroleum and agricultural sectors and a rational development of these sectors will improve the population’s socio-economic situation.

The country has considerable petroleum resources and sSpecialists’ forecasts estimate that the country will remain classified as one of the world’s biggest producers for a long time. The challenge facing the government is how to maximize this natural wealth, use it rationally for the development of the country’s human resources, promote productive investments, diversify the economy, and improve the population’s living conditions.  Taking account of these constraints and conclusions from participatory consultations with the different components of the society, the Bank Group is going to help the government better organize the country’s economy, rationally use resources, and promote good governance. As the country's favoured partner, the Bank Group has re-engaged with the country since October 22, 2008, in the implementation of the country’s priority programmes. To that end, the AfDB  Board of Directors has approved the Country Strategy Paper (CSP) for 2008-2012 in order to support the country in this crucial phase of its history and to efficiently utilize these resources to reduce poverty in the country.

Development Policy

The strategy supports the building of national capacities with a view to economic diversification: about 87% of the gross domestic product (GDP) is generated by the petroleum sector alone. The strategy includes two pillars of concentration: (i) capacity building and (ii) supporting the creation of conditions for economic diversification. The three projects in the 2008 Indicative Lending Programme, two of which have already been approved, aim to provide: (i) support for sound public policies with a view to strengthening economic and institutional governance in order to create an attractive business environment; (ii) support for training middle-ranking and senior managerial staff and for developing technical capacity in the diversification sectors through technical and vocational training; and (iii) support for developing the health system. The Bank Group will also support the development of infrastructure (roads, water, and sanitation) and production support structures, contributing to job creation and poverty reduction.

Bank Group Strategy

The operations strategy is based on a Government-Bank joint project financing mechanism with a minimum 50% of the project cost borne by the State’s own resources. This will enable the Bank to: (i) use the State’s own resources according to rules and procedures that comply with international standards; (ii) thus contribute to the transfer of know-how to national officials under the implementation of these projects; and (iii) support structural reforms aimed at improving the business climate for private sector development in support of economic diversification. It is the Bank’s answer to the paradox that characterizes the REG: abundant financial resources, weak capacity, and poverty.