Financial Crime World

Guinea’s Economy Shows Resilience with 4% Growth in 2018

Conakry, Guinea - The West African nation of Guinea has recorded a notable economic growth rate of 4% in 2018, a significant improvement from the previous year. According to recent data released by the International Monetary Fund (IMF), the country’s gross international reserves have also increased to 3.3 months of imports at the end of 2018.

Factors Contributing to Growth

  • Strong foreign direct investment in the mining sector, leading to an increase in production capacity
  • Future investments in infrastructure projects expected to continue stimulating construction activities
  • Government efforts to improve governance and increase electricity supply to the economy supporting private sector development in the medium term

However, the government has banned the use of certain chemical products for environmental reasons, which has disrupted artisanal gold production. This development is expected to have a short-term impact on the industry but is ultimately aimed at protecting the environment and promoting sustainable practices.

Financial System

The Guinean financial system remains shallow and informal, with total financial sector assets representing only 22% of GDP. Despite this, the introduction of mobile financial services has been instrumental in increasing financial inclusion, with approximately 13.8% of the population having access to a mobile wallet by the end of 2017.

Banking Sector

  • The banking sector dominates the financial system, accounting for 94.6% of total financial sector assets
  • Top three banks represent around 57.4% of the total assets, with two belonging to French international groups and one to a Malaysian financial group

Insurance Companies and Non-Deposit-Taking Institutions

  • The number of insurance companies and non-deposit-taking institutions has increased, but their share in the total assets of the financial sector declined in 2018
  • Long-term trend for these sectors is uncertain due to lack of data since 2017

Conclusion

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Overall, Guinea’s economic outlook remains positive, with the country poised to benefit from strengthening its financial stability framework and improving its business climate.