Guinea-Bissau - Statistical Appendix (Electronic book text)

1. After several years of political instability, which has undermined economic policies and performance, Guinea-Bissau faces an extremely difficult fiscal and economic situation. Frequent changes in government, lack of accountability and ownership, and poor fiscal controls have left a legacy of low growth, unsustainable fiscal deficits, and large stocks of domestic arrears. Though some progress was made under the 2008 EPCA-supported program to reform fiscal management, the fiscal situation was still difficult and domestic arrears continued to accumulate, including several months of government wages. The country has also been hit hard by global economic developments. Last year's surge in food and fuel prices and more recently the slowdown in global growth have put pressures on inflation, the external sector, and government resources, and threaten to severely weaken economic activity.