The International Monetary Fund (IMF) Executive Board has concluded the 2025 Article IV Consultation with Equatorial Guinea. On June 25, 2025, IMF Management approved the completion of the first and second reviews under the Staff Monitored Program (SMP) for Equatorial Guinea and extended it by 12 months. The authorities have agreed to publish the Staff Report prepared for this consultation.
Equatorial Guinea experienced a mild economic recovery in 2024 with a growth rate of 0.9 percent following a significant contraction in 2023. However, non-hydrocarbon GDP growth slowed to 1.3 percent in 2024, and future growth is expected to be modest due to declining hydrocarbon production. Inflation increased from 2.5 percent in 2023 to 3.4 percent in 2024.
The banking sector showed improvement but remains undercapitalized, with an average capital adequacy ratio slightly below the regulatory minimum yet significantly higher than at the end of 2022.
A substantial fiscal adjustment improved the non-hydrocarbon primary balance from -22.3 percent of non-hydrocarbon GDP in 2023 to -17.0 percent in 2024, while public debt decreased from 39.1 percent to 36.4 percent of GDP.
The authorities implemented reforms as part of the SMP, including a new tax law broadening the tax base and steps toward restoring financial sector health. They also developed an AML/CFT strategy and published contracts related to extractive sectors.
Executive Directors commended progress on reforms but noted challenges remain due to declining hydrocarbon production affecting fiscal balances. They urged continued reform implementation, particularly addressing governance challenges for sustainable growth.
Directors emphasized anchoring public debt sustainability requires gradual fiscal adjustments amid declining revenues and stressed efforts are needed for social spending reform and improving social outcomes.
They acknowledged progress toward financial sector health but noted vulnerabilities persist, highlighting approval from regional banking supervisors is necessary for further strategies.
Directors called for enhanced transparency and governance improvements despite setbacks like not publishing asset declarations of public officials.
It is anticipated that Equatorial Guinea's next Article IV consultation will occur on a standard annual cycle.