IMF Staff Concludes Mission to Guinea-Bissau, Sees Growth Outlook and Continued Reform Commitment
Source: IMF Staff Statement
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An International Monetary Fund (IMF) mission, led by Niko Hobdari, concluded a visit to Guinea-Bissau from April 2 to 10, 2025. The team held discussions as part of the 2025 Article IV consultation and the ongoing eighth review of the country’s Extended Credit Facility (ECF) program.
The mission found that Guinea-Bissau’s economy remains resilient, with GDP growth projected at 5% for 2025. This outlook is supported by stronger private investment and more favourable terms of trade. Although growth dipped to 4.7% in 2024—largely due to weaker cashew exports and adverse weather—the authorities are targeting a budget deficit of 3% of GDP this year, in line with ECF commitments.
The IMF emphasized the importance of maintaining reform momentum. Key policy priorities include reducing dependency on cashew exports by diversifying the economy, strengthening public finances, boosting domestic revenue, and enhancing social spending and human capital development. There is also a strong focus on improving governance, managing public debt, and addressing fiscal risks—especially those tied to the state utility company.
Recent reforms in the energy sector were highlighted as critical to future growth, particularly efforts to diversify energy sources and improve power supply reliability. However, the IMF cautioned that both domestic political risks, especially in an election year, and broader global challenges such as trade fragmentation, pose potential threats to stability.
The IMF team met with President Umaro Sissoco Embaló, Prime Minister Geraldo Martins Barros, Finance Minister Ilídio Té, and other key government and central bank officials, as well as international partners. Discussions are expected to continue during the upcoming IMF/World Bank Spring Meetings later this month.
The ECF arrangement—initially approved in January 2023 for SDR 28.4 million (approx. US$37.8 million) and later increased by 40%—aims to support macroeconomic stability and foster sustainable growth and poverty reduction in Guinea-Bissau.
