Guinea-Bissau is highly dependent on subsistence agriculture, cashew nut exports, and foreign assistance. Two out of three Bissau-Guineans remain below the absolute poverty line. The legal economy is based on farming and fishing, but illegal logging and trafficking in narcotics are also important economic activities. The combination of limited economic prospects, weak institutions, and favorable geography have made this West African country a way station for drugs bound for Europe while trade in illegal logging, food, and fishing is also significant.
Guinea-Bissau has substantial potential for development of mineral resources including phosphates, bauxite, and mineral sands. The country’s climate and soil make it feasible to grow a wide range of cash crops, fruit, vegetables, and tubers; however, cashews generate more than 80% export receipts and are the main source of income for many rural communities.
With renewed donor support following elections in April-May 2014 and a successful regional bond issuance, the new government of Guinea-Bissau has made progress paying salaries, settling domestic arrears, and gaining more control over revenues and expenditures. The IMF noted that the new government has taken the positive step of developing a long-term economic plan and approved a three year Extended Credit Facility arrangement for Guinea-Bissau in 2015.
Guinea-Bissau was reinstatate as AGOA Eligible Country on December 23rd 2014. Guinea-Bissau has not yet been declared eligible for Apparel Provision and does not benefit the Lesser Developed Country Special Rule for Apparel (3rd country fabric) nor Lesser Developed Country Rule for Certain Textile Articles (Category 0). Regarding the Category 9 Textile Products, Guinea-Bissau is not yet eligible to export Handloomed / Handmade, nor the folklore annex and ethnic printed fabrics.