Top-Rated Debt Collection Agency in Guinea

The economic risk in Guinea

Economic risk in Guinea is very high (6 out of 6). An economic risk of 6 out of 6 is relatively high in Africa.

GDP and economic growth are critical drivers for economic risk.
The GDP of Guinea is 15,85 bn. USD (2021), growing by 3,12% per year.

In terms of the size of its economy, Guinea ranks #122 out of 183 countries and has a medium-sized economy.

In terms of growth rate, it is ranked #125 out of 183 countries and is therefore considered an excellent growing economy.

GDP per capita is 1174 USD, ranking Guinea number #150 out of 183 countries. This means the purchasing power of citizens in Guinea is low compared to the rest of the world.

You can see a more detailed picture of GDP and economic growth in Guinea in the table below:

Another major impact for the economic risk score is the inflation rate and the interest rates. You can see a more detailed picture of monetary key performance indicators in Guinea in the table below:

The inflation in Guinea was 12,6% in 2021 which is considered a very high inflation rate.

The business environment risk in Guinea

Our analysis shows that the business environment risk in Guinea is high (5 out of 6), which is a pretty average risk score in Africa.

The business environment risk are determined by the level of economic freedom and rights in a country. The critical facts for Guinea in the table below:

As you can see in the table, the property rights index is 32 in Guinea, which is considered low in Africa.

The business freedom index is based on 10 indicators, using data from the World Bank’s Doing Business study. The Index is 47 in Guinea, a quite low score for a country in Africa.

Guinea's overall economic freedom index is 57 out of 100 and is based on factors such as the rule of law, regulatory efficiency, and market openness.

The political risk in Guinea

The political risk in Guinea is very high, with a score of 6/6. This is a relatively high political risk score in Africa.

The governance and political stability indicators are vital drivers for political risk. An overview of Guinea can be seen in the table below:

The rule of law index analyses to which extent agents have confidence in and abide by the rules of society, in particular the quality of contract enforcement, property rights, the quality of the courts, and the police's ability to enforce court orders.

When doing business in a country, the rule of law index is critical as it describes your ability to enforce commercial contracts.

In Guinea, the rule of law index is at -1,13 points, with the score going from -2.5 (weak) to 2.5 (strong). Guinea has, therefore, a very low rule of law index, which means it is often close to impossible to enforce your contracts. We, therefore, recommend avoiding credits and recommend charging upfront payment instead.

Other drivers for the very high political risks are the very weak control of corruption, the very weak political stability index, and the very large shadow economy that is 41,58% of Guinea's GDP.

The commercial risk in Guinea

In Guinea, the commercial risk score is 2/4, which in our model is a low score. This low commercial risk score is pretty average compared to the average in Africa.

The commercial risk is impacted by a country's international trade relationships. You can see some of the key facts for Guinea in the table below:

Guinea has a positive trade balance of 20,19% of GDP. This means that Guinea imports fewer goods and services than the country exports.

The annual growth of exports of goods and services has been growing 3,4% annually - now 53,35% of GDP. Import of goods and services represents 33,16% of the GDP in Guinea.

The financing risk in Guinea

We have calculated the financing risk to be 3/4, which equals a medium risk. A medium financing risk score is pretty average for countries in Africa.

The country's banking system, efficiency, and stability influence the financing risk. You can find the extra information for Guinea in the table below:

In Guinea, the credit information sharing index is 0 on a scale from 0 (low) to 8 (high). The result of this, is that the access and trustworthiness of the credit information in Guinea is very low.

This makes it very difficult for you to understand the credit risk of your counterpart in Guinea. Unless you have a strong relationship with your customers in Guinea, we highly recommend charging payment upfront or using credit insurance.

Your juridical rights as a creditor are 6 out of 12 and, therefore, weak.