Republic of Equatorial Guinea: Selected Issues

March 25, 2009

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Republic of Equatorial Guinea: Selected Issues, (USA: International Monetary Fund, 2009) accessed December 22, 2024

Summary

This Selected Issues paper discusses fiscal sustainability and capital expenditures for Equatorial Guinea. The paper formulates a permanent income hypothesis model and estimates it using data on oil revenues from Equatorial Guinea. The first methodology is based on a standard permanent income model, using a 50-year time horizon and real rate of return of 2 percent. The paper then extends the model to incorporate a feedback effect from capital spending to non-oil GDP growth, and shows its implications for fiscal sustainability.

Subject: Capital spending, Expenditure, Fiscal policy, Foreign exchange, National accounts, Personal income, Real effective exchange rates

Keywords: Capital spending, CR, Current account, Current account norm, ISCR, Oil GDP, Oil revenue, Personal income, Petroleum revenue projection, Production function, Real effective exchange rates, REER, Spending boom

Publication Details

Pages:

34
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2009/099
Stock No:

1GNQEA2009002
ISBN:

9781451816020
ISSN:

1934-7685

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