Untapped Mineral Reserves
Guinea-Bissau is believed to have approximately one-third of the world’s known deposits of bauxite, with 7.4 billion tons of reserves identified. The Bauxite market is expected to grow from 273.97 million tons in 2023 to 330.29 million tons by 2028 as demand for this critical mineral increases worldwide. So far, no commercial extraction has taken place, leaving the door open to investors interested in the mining sector in the country.
Unexploited Oil Deposits
Interest in offshore oil exploration in Guinea-Bissau has grown due to Senegal’s major discovery in 2014. Three offshore blocks in Guinea-Bissau, under the Sinapa and Esperança permits, share geological similarities with Senegal’s oilfields. These reserves have attracted the Spanish oil and gas company PetroNor, which is prospecting and exploring Sinapa (Block 2) and Esperança (Blocks 4A and 5A) in partnership with Petroguin, the national oil company. The deal is expected to strengthen PetroNor’s balance sheet and enable the drilling of an exploration well in H1 2024. The government has recognized promising prospects for commercially valuable oil in its deep waters but calls for increased investment in exploration.
Solar Energy Potential
Solar projects, such as the 20 MW solar PV plant near the capital, as well as the two 1 MW hybrid mini-grid systems in Gabu and Cahungo, are being boosted by government regulations and foreign finance, with the goal of increasing access to power to 80% by 2030. Solar energy has the ability to cover local demand while also contributing to the West Africa Power Pool. Through hybrid solutions, solar investments might relieve energy poverty, diversifying the economy and stimulating industrialization.
A Rapidly Growing Economy
Real Gross Domestic Product (GDP) growth is predicted to reach 4.5% in 2023. This increase is linked to a revival in worldwide cashew demand and exports, a major industry in the country. The budget deficit is expected to be reduced to 4.2% by robust local cashew output, good pay bill control, and smart fiscal measures. Furthermore, the debt-to-GDP ratio is expected to fall to 78.1% while inflation is expected to fall to 5%, improving the investment climate even further.
Ambitious Regulatory Reform
The government is pursuing an ambitious reform agenda to enhance long-term development. Challenges include a high wage bill, interest payments, and relatively low revenue generation, limiting investments in infrastructure and social services. Key reforms include achieving macroeconomic stability, reducing corruption, and improving governance. Digitalization is being used to manage the wage bill and increase revenue. These reforms are poised to strengthen the enable environment for investment in the country, thereby incentivizing foreign capital commitments.
All this and more will be further unpacked during the MSGBC Oil, Gas & Power conference and exhibition, taking place from November 21-22 in Nouakchott, Mauritania. Augusto Poquena, Guinea-Bissau’s Minister of Energy and Industry, will present the country’s investment opportunities, engaging with financiers and projects developers interested in joining the promising energy market of Guinea-Bissau.