Guinea-Bissau is an independent country found in West Africa that spans an area of about 13,948 square miles. The population is about 1,815,698 people. The country gained independence from the Portuguese in 1973 and the country has had a political instability since. No single elected president in the country has ever served successfully for a full 5-year term. The country has one of the world’s lowest GDP per capita, and similarly, one of world’s lowest Human Development Index. More than two-thirds of the country’s population lives in abject poverty and the country’s economic backbone is agriculture with cashew nuts, fish, and groundnuts being the principal exports from the country. Some of the natural resources of Guinea-Bissau include arable land, minerals such as granite, phosphates, bauxite, clay, limestone, and unexploited petroleum reserves.
Arable land in Guinea-Bissau as of 2014 was about 10.67% of the total land area according to the World Bank report. Agriculture in the country plays a significant role and it accounts for more than half of the GDP and employs about 83% of the labor force. Self-sufficiency in food production has been the main aim of several successive governments in the country with the principal crops being cassava, rice, potatoes, beans, tropical fruits, sugar cane, and yams. Rice farming covers about 30% of the total arable land in Guinea-Bissau. The country can be divided into three regions based on the water requirements of the main principal crops. Towards the coastal areas and on the river estuaries is the zone mainly with palm trees or the coconuts, the intermediary marshy areas are predominantly suitable for rice production, while the interior with sandy areas produce mainly peanuts. In the 1950s the country exported approximately 40,000 tons of rice, but by 1962 it was importing rice because of the frequent droughts. In 1999, Guinea-Bissau produced about 130,000 tons of rice, 44,000 tons of coconuts, 38 tons of cashew nuts, 18,000 tons of peanuts, and 8,000 tons of kernels.The 1974 war which led to the country’s independence affected the economy and led to crop failure affecting output by more than one third. Guinea-Bissau took huge external debt to invest in the manufacturing sector, and this led to the neglect of agriculture. Agriculture suffered further through policies such as inappropriate pricing, inefficient marketing systems, and an overvalued exchange rate.
Guinea-Bissau is endowed with a wide array of minerals such as gold, diamonds, bauxite, phosphate rocks, graphite, limestone and clay, and sand among others. Mineral mining in the country play a minor role, and the leading mining project as of 2010 was the project on Farim phosphate, which is considered top quality and was thought capable to produce 2 million tons of phosphate rock every year. The mineral was discovered in the country about 40 years ago, and its viability studies carried out in the 1980s. There are also bauxite minerals in Guinea-Bissau, which was estimated to be about 113 metric tons as of 2010.Bauxite Angola S.A invested about $500 million to extract the mineral which contains 44% aluminum oxide. The country also hopes to attract more investors into the mining industry
Guinea-Bissau has huge forest cover stretching an area of about 70% of the total land area, and they include mangrove swamps in the coastal areas. The rate of deforestation in the country between 1990 and 2015 was about 0.5% annually according to the FAO. Illegal logging in Guinea-Bissau is rampant and the situation became even worse after the military coup in the country which was witnessed in 2012 resulting in lawlessness. Forestry is still underutilized, and it is estimated that proper management could produce at least 100,000 metric tons annually without jeopardizing the ecology. Socotram was a parastatal, which has now been privatized and was split into four different private companies to increase efficiency, competition, and to increase production of timber.
Guinea-Bissau has a coastline on the Atlantic Ocean, which is rich with shellfish and fish. The country has entered into joint venture in fishing with the Portuguese, Algerian, and Russian companies which accounted for about 40% of government revenues between 1992 and 1996. Overfishing has been a big problem together with the lax laws which have led to a significant drop in fishing potential. Similarly, EU quota system and endorsement of modernization program have also affected production. Guinea-Bissau also in 1996 agreed with six other countries in West Africa to monitor fishing zones in the region. It is estimated that about 0.25 and 0.3 million metric tons could be harvested if illegal fishing were eliminated. Bijagos Archipelago, which is a cluster of about 80 islands off the coast of Guinea-Bissau, is famous for fishing where tarpons weighing as much as more than 150 pounds are found. Types of fish found in abundant include the leerfish, jacks, cobia, snapper, and barracuda among others. All these species grow to huge sizes.
Major Challenges Faced By Guinea Bissau's Economy
Guinea-Bissau has experienced many years of political instability and economic downturn. In 1997, the country joined the CFA franc monetary system which resulted in the stability of the monetary system. However, the civil war in the late 1990s and the military coup in 2003 disrupted virtually all the economic activity affecting to a large extent the social and economic infrastructure and further deepening the already rampant poverty levels. Guinea-Bissau is still on the recovery road from the long periods of instability, and the political environment is still fragile. However, the country has begun to show signs of economic recovery and IMF has extended and supported structural reforms. The main challenges facing Guinea-Bissau for the period ahead include rebuilding public administration, achieving fiscal discipline, trying to improve the economy for private investment participation, and attempting to promote economic diversification. The UN has pointed out that the country among other West African countries has become transshipment points of narcotics smuggled to Europe with their origins in South America. The UN described the country as having the potential of slipping into a “Narco-state.”