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Overview

  • Country Overview

    Guinea-Bissau, one of the world’s poorest and most fragile countries, has a population of about 1.8 million. Guinea Bissau’s Atlantic Ocean coast is composed of an archipelago, the Bijagos, of over 100 islands. It borders Senegal to the north and Guinea to the south and east, and despite its size, is host to a large variety of ethnic groups, languages, and religions.

    Political Context

    Guinea-Bissau has a history of political and institutional fragility dating back to its independence from Portugal in 1974. The country is one of the most coup-prone and politically unstable countries in the world. Since independence, four successful coups have been recorded in Guinea-Bissau, with another 16 coups attempted, plotted, or alleged. In addition to military coups, frequent changes in government are another manifestation of the country’s political instability. Between 1999 and 2009, Guinea-Bissau experienced this sort of change each year. In the last 18 months alone the country has had four governments.

    Fragility in Guinea Bissau is mainly a consequence of unfinished political transformation and disconnect between state and society. The current government, led by Umaro Sissoco Embalo, is the fifth since the 2014 elections. However, the government is still unable to present its political program to the National Assembly, which has not opened in almost two years.

    The ECOWAS-brokered Conakry Agreement, which was meant to end the political crisis, offers a historic opportunity for the national authorities, political leaders, and civil society to ensure stability and build sustainable peace. Implementation, however, has shown limited progress.

    The UN has expressed its determination to support Guinea-Bissau in creating a conducive environment for the holding of legislative and presidential elections in 2018 and 2019, the reform of the Electoral Code, and the promulgation of a new law on political parties that would enhance parties’ autonomy and internal democracy. These reforms would be a step toward the creation of an environment conducive to national reconciliation.

    The withdrawal of the Economic Community of West African States (ECOWAS) Mission in Guinea-Bissau (ECOMIB), deployed in the country since 2012, was scheduled for September 30, 2017. The UN Security Council has welcomed a proposed 3-month extension, decided on at an ECOWAS Heads of State meeting held in Monrovia, Liberia, in June 2017, at which ECOWAS members called for the continuation of ECOMIB in Guinea-Bissau beyond this extension, too, and invited international partners to support it

    Economic Overview

    Guinea Bissau’s economy continues to expand in spite of political gridlock and the suspension of donor flows to the country. Following growth of 5.1% in 2015, real Gross Domestic Product (GDP) growth was projected at above 5.1% for 2016. Inflation is expected to pick up with the pace of economic activities but should remain well below 3%. The fiscal situation is still strained by political instability and the suspension of budget support.

    Available information points to a sharp consolidation in central government operations in response to the suspension of budget support by donors (approximately 2% of GDP) to realize a fiscal deficit of 4.2% of GDP in 2016 (preliminary estimates) compared to 3.7% in 2015. Project grants fell by about 22% in 2016, accounting for most of the 10% decline in total revenues. Locally funded capital projects were frozen, while those activities funded by external sources were cut in half. Government operations were funded primarily from domestic and regional sources.

    Development Challenges

    Real GDP growth is projected to average 5% over 2016–2018. The pickup in growth reflects the assumption that output from the agriculture sector will remain fairly robust, and that political stability is achieved to allow for a return of donor financing that would support a recovery in the secondary sector. This growth path also reflects the assumption of a recovery in electricity and water generation.

    Given the history of fragility in Guinea Bissau, the outlook is highly uncertain, with pronounced risks to growth and poverty reduction. The reliance on cashew nuts for economic livelihood exposes two-thirds of the population to terms-of-trade shocks. Further diversification, either through moving up the value chain—with agricultural technology and market support systems—or through capitalizing on other green shoots in the agriculture sector will be key to bolstering the resilience of the economy. Failure to introduce urgently needed reforms to strengthen project appraisal capacity and introduce equity-based formulas for budget allocation could delay the gains from fiscal and economic improvements. Addressing high inequality in the country also requires efforts to improve service delivery and enhance access to basic services. However, accelerating or even sustaining the pace of poverty reduction will be difficult if the political situation remains unresolved, and if the major development challenges that constrain growth, inclusiveness, and sustainability are not addressed.

    Bank portfolio in Guinea-Bissau

    As of September 2017, the portfolio in Guinea-Bissau (as at end June 2017) comprises four projects amounting to $90.61million. The overall percentage disbursement as of June 30, 2017 is estimated at 41.5%. Overall portfolio performance is Moderately Satisfactory. To boost country portfolio performances, a Country Portofolio Performance Review (CPPR) was held in March 2017 to stress key constraints, such as the lack of fiduciary capacity in the country.

    Guinea-Bissau’s portfolio also comprises two regional projects amounting to $ 84 million. Most of the regional portfolio relates to: (i) Energy, such as the OMVG interconnection project; (ii) and Fishery projects.

    Overall, the size of the portfolio is expected to increase significantly with the coming three years with the IDA18 allocation of $87.5 million.

    Last Updated: Oct 19, 2017

  • World Bank Engagement in Guinea-Bissau

    Guinea-Bissau joined the World Bank in March 1977, three years after independence. The first program for it was approved in 1979, for a road construction and restoration project.

    World Bank engagement in Guinea-Bissau is based on the Country Partnership Framework for Guinea-Bissau for the fiscal years 2018–2020, as  discussed and endorsed by the World Bank Board of Executive Directors in June 2017. It is the first, full country strategy since 1997.

    The two main focus areas of the CPF are:

    1. Increasing access to basic quality services
      1. Increasing access to quality primary education
      2. Increase access and quality of maternal and child health services
    2. Strengthening the resilience of rural households to economic and environmental shocks
      1. Increase access to markets
      2. Strengthen natural resource management
      3. Strengthen social safety nets

    The CPF has benefited from the findings of the 2016 Systematic Country Diagnostic and the 2015 Fragility Assessment. It also reflects feedback from consultations with the Government of Guinea-Bissau, private sector, civil society, and development partners.

    The current active portfolio for Guinea-Bissau consists of four national IDA operations ($65.6 million), and two regional IDA operations ($84 million) for a total commitment amount of $149.6 million. The largest share of the portfolio is in energy (55%), followed by water (16%), social protection (14%), trade & competitiveness (6%), environment & fisheries (6%), and governance (3%). The World Bank has also supported non-lending activities in Guinea-Bissau, such as a Public Expenditure Management and Financial Accountability Review (PEMFAR) and a Country Economic Memorandum (CEM). Under the 18th replenishment of International Development Association resources (IDA 18), the national allocation for Guinea‐Bissau is expected to almost double, compared to the allocation for IDA 17, which was $42 million.

    International Finance Corporation (IFC)

    Prior to the April 2012 coup, the International Finance Corporation (IFC) made significant progress in advancing the three following initiatives: a warehouse financing deal with a bank to facilitate the export of cashews, a joint World Bank PPP energy project entitled Electricidade e Águas de Guinea-Bissau (EAGB), and a joint World Bank investment climate reform program. All three projects were put on hold because of the political situation.

    Last Updated: Oct 19, 2017

  • Emergency Food Security Support Project

    At the request of the government of Guinea-Bissau, the World Bank implemented the Emergency Food Security Support Project (EFSSP) as a response to the 2008 international food price crisis. The objective of the project was to improve food security for the most vulnerable populations, including children, and increase smallholder rice production in project areas.

    Under this project, the number of students receiving one meal a day on average was 14,102, 49% of whom were girls. The project also generated 285,000 work days, against the lower target of 160,000 work days initially planned. About 9,100 tons of paddy rice is estimated to have been produced on rehabilitated rice land, exceeding the project’s target of 7,500 tons.

    The support of this project was strengthened by a second parallel operation funded by the European Union Food Crisis Rapid Response Facility Trust Fund (EUFRF). The food-for-work program dealt with the rehabilitation of rural feeder roads critical to enhancing welfare by improving access to the project’s areas. Under this trust fund (now closed), the number of students receiving one meal a day on average was 28,030, 48% of whom were girls. The project generated 165,000 work days against a target of 162,000 work days. The direct beneficiaries under the food for work program were 7,310 participants, and indirect beneficiaries were 43,860, with a total of 51,170 beneficiaries against a planned target of 18,900 beneficiaries by the end of the project.

    Support for this project continued in 2015 with a $7 million trust fund from the Global Food Crisis Response Program (GFCR). The operation successfully achieved its four development objectives:

    • Providing one meal a day for 17,500 students for a period of 160 days and take home rations for 2,500 girl students for 160 days. The World Food Program (WFP) started the provision of school feeding in February, 2015 and completed it in June, 2015. In total, the WFP provided one meal a day to 35,115 students of which 17,052 were female in 150 schools. Take home rations benefitted 5,299 girls who received a total of 105.8 tons of rice.
    • Generation of employment for 250,000 work days (100 days per participant for 2,500 farmer participants) and provision of food rations to 17,500 direct and indirect farmer household beneficiaries under the food-for-work program to rehabilitate land.  Under this activity, there were 4,402 participants which translates into 30,814 beneficiaries.
    • Rehabilitation of 5,000 hectares of land for rice cultivation, of which 2,532 hectares were mangrove land and 2,769 hectares were low land.
    • Provision of agricultural inputs to at least 4,000 smallholder farmers involved in rice cultivation.

    Last Updated: Oct 19, 2017

  • Guinea-Bissau’s main development partners are the European Union (EU), together with European bilateral donors, the Economic Community of West African States (ECOWAS), the West Africa Economic Monetary Union (WAEMU), the West Africa Development Bank (BOAD), African Development Bank (AfDB), United Nations agencies, World Bank Group and the IMF. Important emerging non-traditional donors are Angola, China, and Iran.

    Last Updated: Oct 19, 2017

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LENDING

Guinea Bissau: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments



PHOTO GALLERY

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Additional Resources

Country Office Contacts

Main Office Contact
Kristina Svensson
Resident Representative
Predio das Nacoes Unidas
Rua Rui Djassi
Bissau
Guinea-Bissau
+245 95 5651448
ksvensson@worldbank.org
For general information and inquiries
Mademba Ndiaye
Senior Communications Officer
Dakar, Senegal
+221-33-859-4140
mademba@worldbank.org
For project-related issues and complaints
guineabissaualert@worldbank.org