Despite large mineral deposits and high agricultural
potential, economic development since independence in 1958
has been negative, and Guinea is today one of the world's 25
poorest countries. As a result of the build-up of the
mineral sector in the 1970s, GDP increased by 3 percent per
year in 1970-80. However, in the years 1980–85 GDP fell by
1.4 per cent per year, which among other things is
considered to be due to strong state control of the economy.
During the 1970s and 1980s, a large informal sector
developed in response to state control of the formal
economy. In 1984, several reforms were introduced, such as
increased privatization, liberalized foreign trade and the
removal of price controls. This led to an increase in GDP
growth of an average of 4 per cent per year 1988–95 and an
increase in GDP per capita.
The positive trend continued in the 1990s with annual
growth of about 5 per cent, but during the 1990s the growth
rate dropped and the 2008 coup d'état turned out to have
very negative financial consequences. Comprehensive
corruption and substandard infrastructure are other problems
facing the country.
Agriculture, forestry and fishing
Despite the rapid development of the mineral sector,
agriculture is still the most important economic sector.
Growth during the 1970s and 1980s was low due to low
producer prices and strong state control, which has led to
extensive smuggling. During the 1980s, approximately 25
percent of the food requirement was imported. Changing
ownership conditions and improved infrastructure led to
strong growth in agriculture during the early 1990s, but the
country still has to import food.
The most important food crops are rice, cassava, sweet
potato and corn. The most important forage crops are
bananas, pineapple, oil palm products, peanuts and coffee.
Livestock management also plays an important role, but also
contributes to deforestation and, ultimately, to soil
erosion. Previously, 2/3 of the country's surface area was
forest covered, but felling and burning have been extensive
and the corresponding figure is now around 25 per cent.
However, Guinea still has great potential for forestry. The
total withdrawal is estimated to be about 12.5 million m
3 per year, the majority of which is used as
firewood. Fishing is relatively underdeveloped, but is
considered to have great development potential. Every year,
86,000 tonnes are caught, mostly by foreign vessels, mainly
from EU countries that bought fishing licenses from Guinea.
countryaah, mining is one of Guinea's most important economic
sectors. Guinea holds 30 percent of the world's best-known
bauxite deposits and is one of the world's largest
producers. Bauxite accounts for more than half of export
revenue. Bauxite production increased in 1972-80 from 2.6
million tonnes to 13.9 million tonnes. After a decline due
to reduced aluminum demand in the early 1980s, production
increased again and in 2010 amounted to just over 17 million
tonnes per year. Bauxite mining began in Fria (present
Friguia) in 1930, and aluminum production began in 1960 (in
2010, 597,000 tonnes of aluminum were produced). The largest
bauxite mines today are found in Boké in northwestern
Guinea. The largest, yet unused deposits are found at Debélé
Diamond production increased in the late 1960s, and
80,000 carats were produced in the early 1970s. However,
illegal production and smuggling meant that diamond mining
was halted in the late 1970s. Production was resumed in the
mid-1980s, and in 2010, 374,000 carats were produced. Gold
deposits, which are only partially exploited, can be found
at Siguiri in Guinea's northeast. Large iron deposits have
been discovered but have not yet begun to be exploited. In
the country there are also unexploited deposits of lead,
cobalt, copper, chromium, manganese, nickel, platinum and
Guinea lacks known fossil fuel deposits. However, they
are looking for oil on the continental shelf. Water energy
accounts for most of the total energy production and the
potential for water energy expansion is great. About
two-thirds of the electricity is consumed by the aluminum
smelter in Friguia, while households largely cover their
energy needs through wood burning.
Guinea's industry is underdeveloped and is primarily
focused on importation. The shortage of foreign currency,
commodities, skilled labor and technology as well as low
domestic demand have also led to low capacity utilization.
However, employment in the industrial and service sectors
increased from 12 to 30 per cent of the economically active
1965-2010. Among other things, there are textile and cement
factories as well as the building and food industries.
Guinea's trading situation has improved since the bauxite
extraction started in the early 1970s, and since the second
half of the 1990s, the trade balance has usually shown a
smaller surplus. Bauxite (aluminum) accounts for more than
half of the export value; other export products include
gold, coffee and diamonds. Imports are dominated by
semi-finished products, capital goods, oil and petroleum
products, food and consumer goods. The Netherlands, Ghana
and China are important trading partners.