Equatorial Guinea - An introductory economic report

Report No. 4011-EG Equatorial Guinea An Introductory Economic Report June 15, 1983 Country Programs Department II West Africa Region FOR OFFICIAL USE ONLY Document of the U4'brld Bank This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENY EQU4iALENTS 1.Currency Unit: E.kue'le (EK) (plural: bikuele) 2. The Ekuele is pegged to the Spanish peseta at a rate of EK 2 Pta 1 3.- ExchangRe rate with'respect to the US dollar as,of May 1,983 US$ 1.000=E 274.00 EK 100 =us$ 0.365 1meter (in) =3.2'8 fee t 1 kilometler (kin) =0.62 mile's 1 hectare (ha) = 2.47 acrles, 1: square kilometer (km,2 0.386 square miles. 1. kilogram (kg) =2.205 pDounds 1~ metric to-n (t) 2205 pounds 1Iliter (1) =0.26 gallo~ns Y I SCA YEAR January 1I December 3  FOR OFFICIL USE ONLY PREFACE This memorandum provides a basis for resuming a dialogue between the Government and the Bank Group on the current economic situation and outlook in Equatorial Guinea. The report is based on a mission by Ulrich Hewer (economist) in November 1981. It also includes the findings of a reconnaissance mission by Hilda Yumiseva (consul- tant). A draft report was sent to the Government in August 1982 and discussed with the Government in November 1982. This version incorporates information and comments provided by the authorities at that time. This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.   EQUATORIAL GUINEA: AN INTRODUCTORY ECONOMIC REPORT Table of Contents LIST OF ABBREVIATIONS AND ACRONYMS SOCIAL INDICATORS DATA SHEET SUMMARY AND CONCLUSIONS I. INTRODUCTION ............................. ............... .*.... 1 II. ECONOMIC POTENTIAL AND DEVELOPMENT CONSTRAINTS ............. 3 Employment, Wages and Prices ............................... 3 A&griculture ................................................... 4 Agricultural Marketing and Extension Services ........... 9 Industry, Mining, Commerce and Tourism .............. . 10 Infrastructure .......... ............... 13 III. PUBLIC FINANCE ................................ o.......... 14 The Budget .... .......... 14 Public Enterprises ............................... .*........ 16 IV. MONEY AND CREDIT ........................................ 17 V. BALANCE OF PAYMENTS .. ..... ................................ 19 Merchandise Exports and Imports .................... ....... 21 Services and Transfers .. .................................. 22 Capital Movements ........ ................... .......... 22 International Reserves ........................ . 22 External Debt . . ................................... ... 23 VI. DEVELOPMENT STRATEGY AND PROSPECTS ....... .... .... 24 LIST OF TABLES IN THE TEXT Table 1: Distribution of Cocoa Plantations on Bioko at the End of 1982 ...................... . 6 Table 2: Central Government Budget 1980-1982 .............15 Table 3: Monetary and Credit Developments, 1979-1982. 18 Table 4: Balance of Payments, 1976-1982 .20 Table 5: Composition of Exports 1970 and 1976-1982...... 21 Table 6: External Debt, 1980-1982 .......... .. .. ... 23  STATISTICAL APPENDIX Table 1: National Accounts .............................. 29 Table 2: Central Government Finance, 1970-1971 and 1980-1982 . . .......... 30 Table 3: Central Government Revenue, 1980-1982 . . 31 Table 4: Central Government Expenditure, 1980-1982 ...... 32 Table 5: International Reserves, 1979 - Sept. 1982 ...... 33 Table 6: Selected Retail Prices in Malabo Market, 1979 - October 1982 ..... .............. . .... . 34 Table 7: Commodity Producer Prices, 1979-1982 ........... 35 Table 8: Selected Timber Export Prices, 1978-1982.......36 Table 9: Summary of Export Tariffs, 1980-1982 ........... 37 Table 10: Summary of Import Tariffs, July - December 1980 ..................... .... 38 Table 11: Production of Export Commodities ............... 39 Table 12: Education--Main Indicators, 1980.............. 40 Table 13: Structure of Main Petroleum Product Prices, December 1981 ................................ 41 MAP - IBRD 10259R1  LIST OF ABBREVIATIONS AND ACRONYMS ADF = African Development Fund BCD Banco de Credito y Desarollo (Credit and Development Bank) BGE = Banco de Guinea Ecuatorial (Bank of Equatorial Guinea) (formerly Central Bank) CEPE = Comite Ejecutivo para Politica Economica (Executive Committee for Economic Policy) CMS = Consejo Militar Supremo (Supreme Military Council) EC Eurcpean Community FED = Fonds Europeen de Developpement (European Development Fund) GEMSA = Guineo Espanola Minera Sociedad Anonima (Guineo- Spahins Mining Ltd.) GTZ = Gesellschaft fur Technische Zusammenarbeit (German Agency for Techn'ical Cooperation) GUINEXTEBANK = Banco Exterior de Guinea Ecuatorial (External Bank of Equatorial Guinea) SDR = Special Drawing Right TA = Technical Assistance   Page 1 of 3 TABLE 3A EQUATarII TNEA - SOCIAL INDICATORS DATA SHEET EQUAToRIAL GUINEA REFERENCE GROUPS (WEIGHTED AVE GES AREA (THOUSAND SQ. KM.) - HOST RECENT ESTIMATE)- TOTAL 28.1 AGRICULTURAL 3.3 MOST RECENT LOW INCOME MIDDLE INCOME 1960 /b 1970 /b ESTIMATE /b AFRICA SOUTH OF SAHARA AFRICA SOUTH OF SAHARA GNP PER CAPITA (US$) .. .. .. * 250.8 1053.2 ENERGY CONSUMPTION PER CAPITA (KILOGRAMS OF COAL EQUIVALENT) 120.6 66.9 103.1 66.5 610.1 POPULATION AND VITAI STATISTICS POPULATION, MID-YEAR (THOUSANDS) 244.0 274.0 311.0 * URBAN POPULATION (PERCENT OF TOTAL) .. .. 17.8 28.3 POPULATION PROJECTIONS POPULATION IN YEAR 2000 (MILLIONS) 0.5 STATIONARY POPULATION (MILLIONS) 1.5 YEAR STATIONARY POPULATION IS REACHED 2130 POPULATION DENSITY PER SQ. KM. 8.7 9.8 10.9 27.7 54.7 PER SQ. KM. AGRICULTURAL LAND 76.0 82.8 91.3 86.7 129.9 POPULATION AGE STRUCTURE (PERCENT) 0-14 YRS. 38.9 40.4 41.8 44.8 46.0 15-64 YRS. 57.1 55.5 55.0 52.3 51.1 65 YRS. AND ABOVE 4.0 4.1 3.3 2.9 2.8 POPULATION GROWTH RATE (PERCENT) TOTAL 1.5 1.2 1.3 2.7 2.8 URBAN .. .. .. 6.2 5.2 CRUDE BIRTH RATE (PER THOUSAND) 43.0 42.0 42.3 47.3 47.2 CRUDE DEATH EATE (PER THOUSAND) 26.9 22.2 18.6 19.5 15.7 GROSS REPRODUCTION RATE 2.8 2.8 2.8 3.2 3.2 FAMILY PLANNING ACCEPTORS, ANNUAL (THOUSANDS) USERS (PERCENT OF MARRIED WOMEN) .. FOOD AND NUTRITION INDEX OF FOOD PRODUCTION PER CAPITA (1969-71-100) 100.0 100.0 .. 88.7 90.7 PER CAPITA SUPPLY OF CALORIES (PERCENT OF REQUIREMENTS) .. .. .. 90.2 93.9 PROTEINS (GRAMS PER DAY) .. .. .. 53.1 54.8 OF WHICH ANIMAL AND PULSE .. .. .. 18.4 17.0 CHILD (AGES 1-4) DEATH RATE 43.7 37.5 30.6 26.7 23.9 HEALTH tIFE EXPECTANCY AT BIRTH (YEARS) 37.2 42.2 47.1 45.6 51.0 INFANT MORTALITY RATE (PER THOUSAND) 187.8 166.6 142.9 129.9 118.5 ACCESS TO SAFE WATER (PERCENT OF POPULATION) TOTAL .. .. .. 23.9 URBAN .. .. .. 54.9 RURAL .. .. .. 18.5 ACCESS TO EXCRETA DISPOSAL (PERCENT OF POPULATION) TOTAL .. .. .. 25.8 URBAN .. .. .. 63.1 RURAL .. .. .. 20.2 POPULATION PER PHYSICIAN 5809.5 11080.0 58000.0/c 32097.3 14185.2 POPULATION PER NURSING PERSON 614.4 .. 843.067 3264.6 2213.2 POPULATION PER HOSPITAL BED TOTAL 193.8 .. 83.0/d 1225.0 1036.4 URBAN 53.7 .. 52.37d 249.5 430.8 RURAL 9048.2 .. 193.87- 1712.1 3678.6 ADMISSIONS PER HOSPITAL BED .. .. HOUSING AVERAGE SIZE OF HOUSEHOLD TOTAL .. .. UREAN .. .. RURAL .. .. AVERAGE NUMBER OF PERSONS PER ROOM TOTAL .. .. URBAN .. .. .. RURAL .. .. .. ACCESS TO ELECTRICITY (PERCENT OF DWELLINGS) TOTAL URBAN RURAL .. .. ..  Page 2 of 3 TABLE 3A EQUATORIAL GUINEA - SOCIAL INDICATORS DATA SHEET EQUATORIAL GUINEA REFERENCE GROUPS (WEIGHTED AVER4GES - MOST RECENT ESTIMATE)- MOST RECENT LOW INCOME MIDDLE INCOME 1960 /b 1970 /b ESTIMATE /b AFRICA SOUTH OF SAHARA AFRICA SOUTH OF SAHARA EDUCATION ADJUSTED ENROLLMENT RATIOS PRIMARY: TOTAL 85.0 73.0 81.O/c 63.2 83.3 MALE 103.0 82.0 89.07W 72.7 96.1 FEMALE 67.0 63.0 72.0/c 50.3 80.4 SECONDARY: TOTAL 2.0 16.0 11.0/c 10.2 15.3 MALE 3.0 24.0 19.07 13.2 19.4 FEMALE 1.0 8.0 4.07W 6.6 11.3 VOCATIONAL ENROL. (% OF SECONDARY) 37.8 10.0 8.2/c 7.9 4.7 PUPIL-TEACHER RATIO PRIMARY 75.6 57.0/e .. 47.4 38.6 SECONDARY 36.4 34.4 27.4/c 26.2 23.4 ADULT LITERACY RATE (PERCENT) .. .. .. 34.0 35.6 CONSUMPTION PASSENGER CARS PER THOUSAND POPULATION .. .. .. 3.0 31.9 RADIO RECEIVERS PER THOUSAND POPULATION .. 29.2 266.7 34.8 71.8 TV RECEIVERS PER THOUSAND POPULATION .. .. 3.3 1.7 17.9 NEWSPAPER ("DAILY GENERAL INTEREST") CIRCULATION PER THOUSAND POPULATION 3.3 .. .. 2.9 19.1 CINEMA ANNUAL ATTENDANCE PER CAPITA .. .. 1.7/d 1.1 0.6 LABOR FORCE TOTAL LABOR FORCE (THOUSANIDS) 73.6 79.8 86.9 FEMALE (PERCENT) 3.8 4.2 4.7 34.1 36.5 AGRICULTURE (PERCENT) 84.0 80.0 76.0 78.4 56.5 INDUSTRY (PERCENT) 6.0 7.0 8.0 9.2 17.7 PARTICIPATION RATE (PERCENT) TOTAL 30.2 29.1 27.9 41.4 37.0 MALE 59.6 57.1 54.3 53.9 46.9 FEMALE 2.3 2.4 2.6 29.1 27.2 ECONOMIC DEPENDENCY RATIO 1.4 1.5 1.6 1.2 1.3 INCOME DISTRIBUTION PERCENT OF PRIVATE INCOME RECEIVED BY HIGHEST 5 PERCENT OF HOUSEHOLDS HIGHEST 20 PERCENT OF HOUSEHOLDS .. LOWEST 20 PERCENT OF HOUSEHOLDS LOWEST 40 PERCENT OF HOUSEHOLDS .. POVERTY TARGET GROUPS ESTIMATED ABSOLUTE POVERTY INCOME LEVEL (USS PER CAPITA) URBAN .. .. .. 134.3 507.0 RURAL .. .. .. 82.9 200.6 ESTIMATED RELATIVE POVERTY INCOME LEVEL (US$ PER CAPITA) URBAN .. .. 96.4 523.9 RURAL .. .. .. 60.4 203.6 ESTIMATED POPULATION BELOW ABSOLUTE POVERTY INCOME LEVEL (PERCENT) URBAN ., .. .. 39.3 RURAL .. .. .. 69.0 Not available Not applicable. NOTES /a The group averages for each indicator are population-weighted arithmetic means. Coverage of countries among the indicators depends on availability of data and is not unifors. /b Unless otherwise noted, data for 1960 refer to any year between 1959 and 1961; for 1970, between 1969 and 1971; and for Most Recent Estimate, between 1978 and 1980. /c 1975; /d 1977; /e 1973. * 1981 estimates of population and GNP/capita are 350 thousand and $180.0 respectively. May, 1982  Page 3 of 3 DEFINITIONS OF SOCIAL INDICATORS RoI.n Although the dalt are dross frie sources -enerslly judged the not authoriacaive and reliable. 1t should also be noted that they eay vot be inter- tiolly comparable becoeo of the tack of stondardtzod dofinitlons sod concepts used by different ..ounr is in co1lectlig the dots. The daiS see, none theless, useful to describe orders of sagnit.de, iedicate tronds, cod charact-rize certain major differenoes bet seen counnrie. The rf erenc ..pt ore (1) the a country group of the tabj) ect ountry end (2) a country group ith no=ethat bhighor overage Ioose chan the cso-try groop of the sobjject coa-try (occept for "Slgh Income Oil IEporters" groap chore "Middle Incot North Afric and Middle tant" Is chosen because of sroegr snoto-calcarol affinities). In the roforetco grasp daIs the averages are population weiShted aoithgetic nuns for each indicator and shbow only nhen majority of the countries In o groap hss data for that tndicotor. Since the coverage ef countrels a-ong the indicators depends In the aIailabtlity of data sod is not tnifort, csotion must be exercised in relsting averages of one tndicator to onother. Thexe n -orages aeo only useful ine -poring the role of one indicator at a tin h asong lbe ceoncry and reference groups. AREA (thoasa.d tq.kz.) Population per Rospital BNd - total, rban., and rural - Popolstion (tocI. Total - Total surface urea co-prising land arce aed inlacd waters; 1979 dart. .Iban, aed rural) divided by their respec * ntsber of hoopital bed gricultural - Estimafe cf agriculcural area card temporarily or perraoently available in public and private goneral so. specialized hospital and re- for cropt. pastarer. market and kitchee gardens or to le fallo.; 1979 data. habilitation teeters. Hospitals ahe -stobltubnnc peraently srcffed by at least one physician. Establiohzntu previding peincipally custo- GNF PER CAPITA (CS) - GNP per capita estisates at curreot market prices. cal- dial caro are ono iocludod. ROIa h.pital. hb r, iloude health culated by sz conrersion ethod as World Bask Atlas (1978-80 basis); 1960, and mdical cnera ct permanenly sffed by s physician (bot by a 1970, and 1980 data. medical -ssistant, noose, midwife, ntc.) shieb offor in-patient accote- dalton and.provIde,_ aI limted ....o of edia f Fiiie. r sta is ENERGY CONSUMPTION PER CAPITA - Annua1 cons-plticn of cozeorcial energy (coal dealo parp arhsn h. pitols include oaHOn ptincipal/geoer-l hrspitlt.i end lignIte, peteoleue. naotral ian anndhydr-.-l- an geotheral eiec- atd rural hospitals., locale or at hspitals ad medical cd matenty tricity) in kilogreNs of ooal equioalent per tspita; 1960. 1970, and 1979 centers. -pecialiIed hospitals re included only onder total. data. -ddisnicnt per Eospital Sod - Total camber of admissions to or diacharges Pfro hospitals diided by the neAbnr of bedt. POPULATION AND VITAL. OTiTSTIC Total Ppoulation. Mid-Tear (thousands) - As of July i; 1960, 1970. and 19O 01USIldG datajo. Aveoagn Sloe of Hnusehol,,d(ernsprhohud- total, otbn, and rorsI- Peba 'Iolti", (percen t of coral) -Ratio of ceban tn ctatl popolatioc; A household -cnittnIageapo idoidult1 who bcetliolog qnartoes different difinitiena of arban areas may a