WORLD TRADE
ORGANIZATIONWT/TPR/M/54
9 April 1999
(99-1404)
Trade Policy Review Body
25-26 February 1999
TRADE POLICY REVIEW
GUINEA
Minutes of Meeting
Chairperson:  H.E. Mr. Jean-Marie Noirfalisse (Belgium)
Page
I. INTRODUCTORY REMARKS BY THE CHAIRPERSON 2
II. OPENING STATEMENT BY THE REPRESENTATIVE OF GUINEA 3
III. STATEMENT BY THE FIRST DISCUSSANT 4
IV. STATEMENT BY THE SECOND DISCUSSANT 6
V. STATEMENTS BY MEMBERS OF THE TRADE POLICY REVIEW BODY 7
VI. REPLIES BY THE REPRESENTATIVE OF GUINEA AND
ADDITIONAL COMMENTS 9
VII. CONCLUDING REMARKS BY THE CHAIRPERSON 13
ANNEX I 16
ANNEX II 21WT/TPR/M/54
Page 2
I. INTRODUCTORY REMARKS BY THE CHAIRPERSON
1. The first review of the trade policy of Guinea was held on 25 and 26 February 1999.
H.E. Ambassador Jean-Marie Noirfalisse (Belgium) chaired the meeting.  The Chairperson welcomed
the Guinean delegation, led by Mr. Sékou Amadou Top, Secretary General of the Ministry for the
Promotion of the Private Sector, Industry and Trad e, and Mr. Amadou Sow, Adviser to the Ministry
of Planning and Cooperation, as well as the two di scussants, H.E. Ms. Absa Claude Diallo (Senegal)
and Mr. Quan-Ling Sim (Canada).  He expressed the hope that the Guinean delegation would be able
to hold discussions with other officials of the WTO Secretariat during its visit.  He also welcomed the
members of the Trade Policy Review Body (TPRB).
2. The Chairperson recalled the purpose of the Trade Policy Review Mechanism (TPRM), as set
out in Annex 3 to the Marrakesh Agreement, and the procedures to be followed in the course of the
meeting.  The report by the Government of Guinea had been issued under the symbol WT/TPR/G/54and the report by the WTO Secretariat under the symbol WT/TPR/S/54.  As usual, the two discussants
would speak in their personal capacities and not as representatives of their respective countries;  the
main issues they proposed to raise were contained in document WT/TPR/D/34.
3. The Guinean delegation had received a copy of the written questions submitted by:
Hong Kong, China;  Japan;  United States;  Eu ropean Union (Annex I).  If it proved impossible to
reply to all the questions fully during the meetin g, additional written replies would be transmitted
subsequently.WT/TPR/M/54
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II. OPENING STATEMENT BY THE REPRESENTATIVE OF GUINEA
4. The representative of Guinea underlined his Government’s satisfaction at the first review of
Guinea’s trade policy and conveyed the regrets of the Minister for Trade, who had been unavoidably
detained at the last minute and was thus unable to lead the delegation.  He stressed that Guinea,
having resolutely opted for a liberal economy, was well aware of the scope and importance of theTrade Policy Review Mechanism (TPRM), which constituted a valuable and indispensable tool for
building a multilateral trading system based on transparency and safeguarding the interests of each
and every partner.  Guinea was certain that the joint and objective assessment of its economy within
the TPRM framework would not only facilitate, but also uphold and support Guinea’s integration into
the global economy so as to improve the living standards of its population.  As the 125
th original
Member of the WTO, Guinea was deeply attached to observance of the rules and principles of the
multilateral trading system that emerged from the Uruguay Round, in the context of a free and openpartnership.
5. Like most developing countries, Guinea’s exports were characterized by a low level of
production capacity compared with external demand and by focalization on a few mining and
agricultural products that were extremely sensitive to price fluctuations on international markets and
had an unfavourable quality/price ratio.  In order to redress the situation and to overcome theproblems caused by an over-valued Guinean franc, and an incoherent trade regime based on price
controls, consumer subsidies and the implementation of national import and export programmes, in
1986, the Government undertook a number of economic reforms (together with its partners) that also
liberalized the trade sector.  The objective of th ese reforms was to improve the economic situation, in
particular by creating an environment that was propitious to the development of business and the flowof investment (by establishing and/or improving basic economic and social infrastructures, for
example).  Growth in trade, including that with other countries in the sub-region, winning back the
international market share previously held by Guinean products, and gradually harmonizing and
adapting Guinea’s trade legislation to the requiremen ts of the multilateral trading system were at the
heart of the reforms.
6. Guinea was not managing to take full advantage of the opportunities afforded by the WTO
Agreements and, even worse, due to the increase in the price of imported basic foodstuffs, it was
facing higher costs.  The Government, in cooperation with some of its development partners, was
therefore taking measures to restructure trade, make the WTO Agreements better known and better
followed up at the national level, enhance the efficiency of enterprises, for example by raising the
quality of exports, and making it easier for persons and goods to move around the country.  The
Reference Centre, made available by the WTO, and the Framework Project for the Promotion ofAgricultural Exports (PCPEA), co-financed by the World Bank, were two of the initiatives taken for
this purpose;  the development of the Centre and its equipment had been requested.  Guinea had high
hopes of the WTO, to whose principles it fully adhered, and of the High-Level Meeting on trade in the
least-developed countries, held in October 1997, and was still awaiting the implementation of the
assistance programme originally planned for 1998, 1999 and 2000.  The establishment of theICC/UNCTAD/WTO Administrative Gr oup was undoubtedly an important step forward, but it should
be followed by action to put into effect all the activities planned under the programme.
7. He assured participants that Guinea was ready to collaborate responsibly with all its
development partners in the context of a more open trading system that eschewed all forms of
discrimination and all obstacles to free and transparent trade.WT/TPR/M/54
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III. STATEMENT BY THE FIRST DISCUSSANT
8. The first discussant, H.E. Ms. Absa Claude Diallo, emphasized that the fact that Guinea had
voluntarily submitted its trade policies and practices to the Trade Policy Review Mechanism showed,
if need be, Guinea’s interest in the World Trade Organization and the special importance it attached to
the Mechanism.  Guinea was a least-developed country (LDC) and its economy depended to a largeextent on the exploitation of raw materials such as bauxite, gold, and diamonds.  Its economy had
long been marked by a high degree of State intervention and its production and outlets were not
sufficiently diversified.  That initial handicap was compounded by the market vicissitudes familiar to
all developing economies that were dependent on raw materials.
9. The goal of the first reform measures undertaken in the 1980s, which involved the
restructuring of trade and the liberalization of th e economy, with the support of the International
Monetary Fund (IMF) in particular, had been to restore the macro-economic and financial balances,boost growth and thus improve the population’s living standards.  Despite the objective constraints
faced when administering the reform programmes, results had been encouraging and since 1989
annual growth in real GDP had exceeded 2 per cent.  Inflation had been contained and the trade
balance, frequently in deficit, had been steadily improving.  Compared with other external balances,
however, the results of the reforms remained modest.  The current balance was still in deficit, due inparticular to the imbalance in services that could not be offset by net capital flows.  In general, greater
efforts needed to be made to improve the current account and foster competitiveness.  She wondered
whether the surplus in the trade balance forecast for 1998 had occurred.  She would also like to
receive information on the measures planned to boost economic growth, diversify exports and
enhance the competitiveness of firms, taking into account the very high cost of finance and transport,exacerbated by the heavy taxes on petroleum products and basic services, including electricity and
telecommunications, and on what was being done to improve the current account and attract foreign
direct investment.  Referring to the long-term initiative entitled “Guinea – Vision 2010”, she noted
that Guinea had indeed reacted to its difficult ec onomic situation.  She would like to know how that
strategy fitted in with the other economic reforms already under way, notably as part of the structuraladjustment programme (SAP).
10. Guinea had applied the GATT de facto  since 24 June 1994 before acceding to the WTO on
25  October 1995.  Its commitments were in the form of tariff bindings and measures relating to the
modes of supply of certain services.  Guinea al so granted most-favoured-nation treatment (MFN) to
its trading partners.  It benefited from the treatment granted to the LDCs, notably in the form of
exemptions or delayed implementation of certain provisions, and received the technical assistance
provided under the integrated programme adopted by the WTO-UNCTAD-ICC Conference inOctober 1997.  Guinea would nevertheless like to receive assistance from its partners and the WTO in
order to diversify production, exports and outlets to a greater extent, complete its implementation of
the Uruguay Round Agreements and make their content better known by giving its human resources
the necessary training, particularly since it had not participated in the Uruguay Round negotiations.
She hoped that the WTO would take Guinea’s concerns into account, together with Guinea’s partnersin a position to support its efforts to become integrated into the global economy.  She would like to
hear the Guinean delegation’s views on the criticism in the Secretariat’s report that Guinea did not yet
participate sufficiently in the activities of the WTO (commitments on goods and services and
notification requirements) and also know Guinea’s intentions with regard to the former list of
concessions taken over from France.
11. She noted that, in order of geographical scope, Guinea was a member of the Mano River
Union (MRU), the Economic Community of West  African States (ECOWAS), and the EEC-ACP
Lomé Convention.  After describing the situation of each of those groups and underlining her deep
conviction that integration was the only way to overcome under-development in those countries, she
sought the views of the Guinean delegation on the current EEC-ACP negotiations and on sub-regionalWT/TPR/M/54
Page 5
integration, particular the action being taken within the West African Economic and Monetary Union
(WAEMU).
12. She congratulated the Guinean authorities on the work already undertaken and the measures
planned in their development efforts.  Even though much remained to be done, it could not be denied
that Guinea was on the right path, the path to transparency, openness, predictability, and consequentlysecurity in trade with its partners.  The first review of Guinea’s trade policy, only three years after its
accession to the WTO, should be seen by its partners as concrete proof of its determination to pursue
the reforms with a view to  greater liberalization.  Bearing in mind Guinea’s substantial potential, this
forcibly led to the conclusion that there was hope,  provided that the international community agreed
to give Guinea a helping hand.WT/TPR/M/54
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IV. STATEMENT BY THE SECOND DISCUSSANT
13. The second discussant, Mr. Quan-Ling Sim, not ed that Guinea, a LDC with a per capita
income of less than US$513, had made remarkab le progress in liberalizing its economy, with
assistance from the IMF and the World Bank.  Nevertheless, some areas of its trade regime remained
protected, although he emphasized that his comments were not intended to underestimate theliberalization efforts made by Guinea.  He highlighted the advantages already offered by local
products (in terms of transport and storage costs) in comparison with imports and the detrimental
effects of restricting their competitiveness.  He requested clarification regarding the quantitative
restrictions on certain products, for example, the import prohibition on potatoes from February to June
each year.
14. He emphasized that the preshipment inspection system, especially the imposition of a flat rate
and the payment of inspection fees by the importer, raised the level of protection of local goods andhe would like to know what was the rationale fo r the minimum charge and the payment of costs by
importers.  The Guinean tariff was complex and comprised 11 separate components.  Moreover, the
fiscal import duty applicable to products such as rice, flour and vegetable oil exceeded the rates
bound.  He asked why there was such a disparity between the rates applied and those bound and
whether Guinea intended to simplify and also lower its tariff?  He would also like to hear the  Guineandelegation’s views on the additional protection given as a result of application of a higher
consumption surcharge on imported products than on similar local products (for example, beer).  He
commented that the multiplicity of export duties and taxes was not consistent with the objective of
promoting exports.
15. The discussant underscored the advantages of protecting intellectual property rights and the
deficiencies of the Bangui Agreement (in comparison with the TRIPS Agreement) in areas such as the
protection of plant varieties, layout designs for integrated circuits, trademarks and copyright.  He
asked whether Guinea had sought technical assistance from the WTO and WIPO, which had signed a
cooperation agreement for this purpose in 1998.  He posed a number of questions regarding the status
of review of the Bangui Agreement, the time requi red to put in place a regime compatible with the
TRIPS Agreement, and asked whether Guinea intended to avail itself of the provisional arrangements
afforded to LDCs for this purpose?  He urged Gu inea to bring its legislation into line with the
provisions of the TRIPS Agreement before the final date of 1 January 2006 fixed for LDCs in order to
reassure investors that their technology would be  protected.  Turning to competition, he asked
whether the bureau that would be responsible for applying the 1994 law was already operating?
16. He noted that Guinea had a favourable climate, fertile valleys and abundant rainfall for the
development of its agriculture.  He pointed out that one of the obstacles to development of the sectorwas the lack of modern agricultural equipment and Guinea could remedy this by lowering the high
import duties imposed.  He then asked what plans Guinea had to expand and exploit its vast
agricultural potential?  Guinea also had huge natural resources such as bauxite, gold and diamonds,
which it could not exploit fully because of the low level of investment and outdated equipment.  He
noted that the mining companies were 100 per cent State-owned and sought clarification regarding theprivatization measures adopted in 1998 in the agricultural and mining sectors, bearing in mind the
problems Guinea had encountered in the manufacturing sector, where the absence of buyers and of
foreign direct investment had led to a slowing dow n of activity following the State’s withdrawal.  He
pointed out that the price controls on petroleum products were contrary to the 1994 competition law
and asked what were the reasons for these controls and whether there were plans to liberalize thissector?WT/TPR/M/54
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V. STATEMENTS BY MEMBERS OF THE TRADE POLICY REVIEW BODY
17. Participants congratulated Guinea on the economic reforms and the liberalization achieved
and urged it to strengthen its attachment to the mult ilateral trading system.  They also congratulated
the Chairperson of the Trade Policy Review Body on his election to the chair.
18. The representative of Hong Kong, China, said that her country had submitted written
questions to the Guinean delegation and recalled that, in addition to the constraints on production
capacity, horizontal and vertical diversification of production and exports were Guinea’s foremost
concerns.  It was important to ensure that the escalation of import duties on several foreign markets,
which constituted an obstacle to diversification, became a priority in future negotiations on trade
liberalization.  She encouraged Guinea to terminate the discriminatory application of the consumption
surcharge on imports and to open government procurement to all suppliers.
19. The representative of Japan stated that his country strongly supported the economic and social
development and the political stability of African countries.  In the context of the follow-up to the
second Tokyo Conference on African Development in the 21st Century, held in October 1998, Japan
had helped to set up an African Investment Information Centre in an Asian country in order to foster
the growth of the private sector in Africa by pr omoting trade with and investment from Asia.  The
debt problem was pressing and Japan had increased its aid to help reduce the debt of African countriesby around ¥30 billion.  He welcomed Guinea’s efforts at reform, with the support of the IMF and the
World Bank, but noted that the tariffs applied to industrial products were around 15 per cent and
tariffs on industrial products in only four HS chapters had been bound.  He sought clarification on the
scope of Guinea’s bindings, the outlook for binding of import duties on industrial products at the level
of the rates applied, when Guinea intended to apply the customs valuation definition contained in theWTO Agreement, the reason why foreign direct investment in Guinea had to be at least
GF 10 million, and when the department envisaged in the 1994 competition law would be set up?  He
also asked whether Guinea intended to liberalize and undertake commitments in sectors such as
telecommunications (including basic telecommunication services under the monopoly of the
SOTELGUI) and financial services?  Written questions had been transmitted to the Guineandelegation.
20. The representative of the European Union noted that, like its partners in the sub-region,
Guinea did not participate fully in the WTO’s activities.  After recalling the advantages of the TPR, he
congratulated Guinea on the significant progress made in an extremely difficult context in which it
had undertaken to move from dictatorship to democracy and from a planned to a market economy.
Nevertheless, Guinea’s political stability remained fragile and its involvement in the crises that had
recently occurred in the surrounding area had compounded its internal problems.  With substantialsupport from external financing sources, Guinea had undertaken one of the most ambitious structural
adjustment programmes in Africa.  He cited a number of obstacles (inadequate infrastructure,
deficiencies in the administration and the judicial system, backward social development) which meant
that although Guinea had exceptional mineral resources and agricultural and hydroelectric potential, it
remained a LDC and at the bottom end of the global classification according to the UNDP humandevelopment indicator.  He drew attention to th e keys to Guinea’s economic development set out in
the Secretariat’s report, and emphasized that, in order to be effective, the relevant reforms had to be
implemented transparently and applied responsibly by the Government.  In addition, combating
corruption must remain a primordial concern.  He  drew attention to the cooperation between Guinea
and the EU and said that the Union was prepared to give Guinea the assistance needed to acquire abetter understanding of the rules and operation of the WTO.  The EU had submitted written questions
to the Guinean delegation.
21. The representative of the United States said that her country was keenly interested in the
economic liberalization process taking place in Guinea as it accounted for a growing share of
Guinea’s exports (24 per cent in 1993 and 31 per cent in 1996).  Through the Generalized System ofWT/TPR/M/54
Page 8
Preferences (GSP), Guinea enjoyed non-reciprocal preferential access to United States markets.  She
referred to the possibilities afforded by the TPRM and to Guinea’s economic performance since its
accession to the WTO in October 1995 (including the growth in exports resulting from a significant
increase in exports of bauxite) in the context of the structural adjustment programmes supported by
the IMF.  She noted that Guinea’s reliance on bauxite exports could make it vulnerable to anyunexpected drop in world prices for aluminium and asked how Guinea intended to develop export
capacity in other products?  In addition to information on the more far-reaching liberalization
programmes in the manufacturing, agricultural and services sectors requested in her country’s written
questions to the Guinean delegation, she would like to receive details concerning Guinea’s plans to
put into effect the TRIPS Agreement.  The United States had a global initiative for Africa and
intended to work together with ECOWAS countries to provide them with technical assistance relevant
to the activities of the WTO and the GSP.  Such assistance could usefully supplement that given toGuinea by the WTO and other organizations under the integrated programme launched at the
high-level meeting held in Geneva in October 1997.  She concluded by expressing the hope that
Guinea would take advantage of every opportunity to take an active part in the WTO’s activities.
22. The representative of Canada said that her country was following closely Guinea’s reform
efforts aimed at developing its economy and promoting its international trade.  She drew attention to
the difficult context in which Guinea had achieved its performance and said that Canada strongly
encouraged Guinea to continue and strengthen the reform process that would allow it to take its place
in the regional economy and develop its trade with the rest of the world.  She described the
background to the economic and trade relations between Canada and Guinea and referred to the
sectors of interest to Canadian firms such as mining.  She summarized the progress made and theefforts under way, pinpointing their relative importance, and urged Guinea to pursue its efforts to
promote and restructure its mining enterprises, for example, the Compagnie des bauxites de Guinée
and the Société des bauxites de Kindia
 so as to enhance the role of the private sector.
23. The representative of Senegal referred to the geographical, historical and cultural background
to Senegal’s trade and cooperation relations with Guinea and asked what measures had been taken or
were envisaged by Guinea to integrate the informal sector (which played an important role in the
economies of the sub-region) into the so-called “formal” sector?
24. The representative of Australia noted that the results of the reform programmes, including the
“Guinea, Vision 2010” strategy and the Enhanced Structural Adjustment Facility, had been positive
but modest.  She welcomed the progress made by Guinea, a LDC, in the area of trade liberalization
and economic reform and encouraged it to continue so as to achieve long-term economic growth.
25. The representative of Côte d’Ivoire underlined her country’s support for Guinea and referred
to the links between the two countries, which shar ed the same concerns regarding the economy and
peace.  The results of the review would have an impact on the trade relations of Côte d’Ivoire and the
sub-region.  She referred to the major reform efforts and the liberalization achieved by Guinea and
called on the international community to provide support.
26. The representative of Morocco drew attention to the economic reforms carried out by Guinea
despite difficulties and mentioned the long-standi ng and permanent links between the two countries.
She cited the products traded by the two countries and noted that between 1993 and 1996 there had
been a trade surplus in Guinea’s favour. Together with the UNDP and UNIDO, Morocco was
providing technical assistance for the creation of SMEs and SMIs in Guinea and was financing
micro-enterprises in the social sector.  Morocco and Guinea had effective cooperation in the bankingsector, but in the air transport and fisheries sectors it had yet to be achieved.WT/TPR/M/54
Page 9
VI. REPLIES BY THE REPRESENTATIVES OF GUINEA AND ADDITIONAL 
COMMENTS
27. The Chairperson of the TPRB opened the sessi on, indicating that the two major themes that
had emerged from the session the previous day had been:  (i) the economic environment;  and
(ii) trade measures and sectoral policies.  He then called on the representatives of Guinea to reply tothe various questions raised the previous day.  It had been decided that additional comments by
participants would be made after the Guinean delegation had replied under these two themes.
(i) Economic environment
28. A representative of Guinea summarized the economic reforms undertaken by Guinea since
1985 and stated that they were intended to reinstate a market economy, restore the broad
macroeconomic balances, boost growth and improve Guinea’s living standards.  The promotion and
development of exports of local products (especially non-traditional products) had been the focus ofthe reform process.  Guinea’s economic activities, including trade, had been liberalized.  A floating
Guinean franc and the establishment of the Interbank Foreign Exchange Market had narrowed the gap
between the official exchange rate and the black market rate.  A Support Centre for Export
Formalities (CAFEX) and a Framework Project for the Promotion of Agricultural Exports (PCPEA)
had been set up, export taxes had been abolished and tariff concessions granted, so as to promote anddiversify exports and allow Guinea to regain the market share it had had from 1958 to 1960, namely,
100,000 tonnes of bananas, 45,000 tonnes of coffee, 150,000 tonnes of palm oil.  The basic legal
texts, founded on liberal principles and aimed at encouraging the development of activities, had been
adopted.  The public investment programme, revised with the help of the World Bank in 1995
following a fall in prices, particularly that of bauxite, was directed towards the development of theinfrastructure (for example, rural dirt roads to allow the movement and export of products);  the
Garafiri dam, financed by the local population and donors, was being built in order to enhance
self-sufficiency in the energy sector.  The privatization of State-owned enterprises and the
establishment of industrial zones were under way.  The continuation of these reforms, including
reorganization of the tariff structure, would help to attract foreign investment and sustain economicgrowth.  Nevertheless, the problem posed by the inflow of refugees in large numbers (around
700,000) could not be overlooked.  In addition, endogenous factors (such as the forthcoming elections
and the depreciation of the Guinean franc) had led to a slight rise in inflation in 1998 compared with
1997.
29. He pointed out that the “Guinea, Vision 2010” strategy was the outcome of a review at the
national level and represented a forward-looking strategy for Guinea’s major economic development
goals within the framework of the structural adjustment programmes, which were simply stages in itsimplementation.  The strategy was making progress and gave priority to agriculture, the highway
infrastructure and social sectors so as to achieve double-digit economic growth from the year 2010
onwards.  Another strategy, “Guin ea, Vision 2020”, was under consideration.  With the support of the
World Bank and the IMF, Guinea’s eligibility for the initiative in favour of the most heavily indebted
poor countries was being examined.  Guinea also inte nded to review its structural policy, with the
assistance of the World Bank.  It had not been involved in the Uruguay Round negotiations so for the
majority of Guineans the WTO and the Agreements reached during the Round had yet to become
known and understood.  Guinea needed technical assistance for this purpose, mainly to train  Guinean
trainers by organizing seminars and round tables in Guinea and study trips or courses at the WTO.  A
request for such training was being reiterated because it had not yet been met, even though it wouldhelp Guinea to play a more active role in the WTO.  The revision of Guinea’s tariffs would not only
take into account the international situation but also that in the region and sub-region (notably
WAEMU’s adoption of a Common External Tariff – CET) and would comply with the commitments
undertaken at the multilateral level.WT/TPR/M/54
Page 10
30. Because of the vulnerability of its economy caused by the low level of production, the import
of almost all consumer goods and the predominance of raw materials in the total volume of exports,
Guinea, as a LDC, joined other countries that wished to see the advantages granted to ACP countries
maintained.  Guinea was working tirelessly towards the rapid achievement of sub-regional integration
and was relying on its comparative advantages and its economic performance to broaden its access toWAEMU markets.  In 1998, Guinea’s trade balance show ed a surplus as a result of growth in exports
of mining products (18 million tonnes of bauxite compared with 15 million tonnes in 1997) and
agricultural products (22,000 tonnes of coffee compared with 19,000 tonnes;  and 40,000 tonnes of
cotton compared with 15,000 tonnes in 1997).  Furthermore, Guinea was waging a decisive struggle
against corruption and waste, inter alia  by computerizing government spending and establishing a
medium-term spending framework.
(ii) Trade measures and sectoral policies
31. A representative of Guinea explained that the preshipment inspection system had been set up
in 1996 as part of the Programme for the Security of Customs Revenue so as to limit the flight of
capital caused by over-invoicing, restrict the import of goods unfit for consumption, and guarantee a
maximum of government revenue from customs sources.  The establishment of the system had led to
a significant improvement in the collection of customs revenue.  Nevertheless, discussions on therenewal of the contract with the SGS were being held in order to examine ways of revising certain
provisions.  Measures would shortly be taken to change the customs valuation based on the Brussels
definition of value to the customs valuation system contained in the WTO Agreements.  The customs
tariff adopted in January 1998 was still being revised to take into account the WAEMU’s Common
External Tariff.  He pointed out that the Secretariat’s report indicated that the data contained thereincould be used for the integrated database.  The National Institute of Standardization and Metrology,
which was drawing up Guinean standards, lacked the material and financial resources needed to carry
out its activities.  Technical assistance had been requested for the purpose of updating Guinea’s
database and setting up a national system for the certification of standards.  The seasonal ban on the
import of potatoes, whose annual production at the national level was 500 tonnes at the most, was no
longer in force.  With regard to the regulations on national content, he said that Guinea would comply
with its obligations as a member of the WTO.
32. He drew attention to the measures taken to promote and develop exports and added that the
private sector was involved in the analysis of trade and related policies at the national level.
Government procurement was through tenders;  the relevant legislation had been amended and a
Government Procurement Journal had been published in order to ensure transparency.  With the
change in regime that had led to political democratization in Guinea, a number of trade unions hadbeen set up, each of which had set goals to be met without State intervention. In parallel with the
current revision of the Bangui Agreement (which it had signed), Guinea would bring its domestic
intellectual property legislation into line with the TRIPS Agreement.
33. The agricultural and mining sectors were the catalysts for economic growth in Guinea.  The
abolition of regulations, the devaluation of the Guinean franc, the rise in producer prices and theliberalization of trade had given farmers renewed confidence and had boosted agricultural production
following large-scale investment.  Food security and improving production were the long-term
objectives of Guinea’s agricultural policy.  Accordingly, the performance of agricultural services and
productivity would be enhanced, the State would continue to withdraw from production and
marketing, the promotion of a private agricultural sector would be pursued, the use of naturalresources would be reorganized, environmental protection would be assured, exports of agricultural
products (coffee, cotton, cereals, fruit) and agri -industry would be developed.  Likewise, with its
potential and the prospects for exploiting it, the mining sector - the motor of Guinea’s economy -
would play an increasingly important role.  The major objectives of mining policy were to restructure
State and parastatal enterprises in the sector, to adopt a more attractive institutional and legalframework, and in the medium and long terms to carry out large-scale mining and infrastructureWT/TPR/M/54
Page 11
projects.  A large amount of capital would have to be mobilized to achieve those objectives.
Measures would be taken to promote and develop mining exports on a permanent basis.
34. He added that the services sector had been fully liberalized.  The contribution of financial
services to the GDP was around 8.5 per cent.  The requirement regarding 20 per cent participation in
the capital of a future bank applied indiscriminately to all first-grade banks recognized as suchworldwide.  Private companies supplied the majority of land and air transport and Guinea had for
some time been seeking to privatize Air Guinée and SOGETRAG.  According to the regulations in
force, any operator could carry out activities in the telecommunications sector. Nevertheless,
measures would continue to be taken to ensure the full liberalization of telecommunications services,
including basic services.  Undertaking firm commitme nts in the services sector meant that Guinea had
to be thoroughly conversant with the General Agreement on Trade in Services and it had requested
technical assistance for this purpose.
35. The first discussant said that she was satisfied by the clear and transparent replies given by
the Guinean delegation.  She drew attention to some of the reforms put into effect and the
fundamental principles of development policy, in dicating that Guinea was on the right path.  She
urged Guinea to persevere and expressed the hope that  the review would lead to a flow of investment,
transfers of technology and know-how.  She stressed that integration was the only way of overcomingunderdevelopment.
36. The second discussant thanked the Guinean delegation for its precise replies, although he
would have liked further details concerning competition policy (for example, on the bureau for
competition and the monitoring of anti-competitive practices) and on the price controls on petroleum
products.  He expressed his satisfaction at the abolition of export taxes, but reiterated that preshipmentinspection was a measure that protected local products and asked whether Guinea intended to apply
the TRIPS Agreement before the final date of 2006.
37. The representative of the United States expre ssed his satisfaction at the abolition of export
taxes and asked whether it applied to all products and all taxes?  He urged Guinea to ensure that
preshipment inspection costs were in compliance with the provisions of the relevant WTOAgreement.  Regarding the customs tariff being revised, he pointed out that frequent amendments did
not guarantee predictability.  He called on Guinea to make further efforts to bind import duties (at
lower rates) and to adopt measures on trade in services.  He requested details regarding the work
under way to bring Guinea’s existing intellectual property regulations into line with those in the
TRIPS Agreement.
38. The representative of the European Union requested further clarification regarding Guinea’s
position vis-à-vis  the WAEMU and preshipment inspection, which could only constitute a temporary
solution.  He expressed his satisfaction at the liberalization reforms being implemented or planned and
congratulated the Guinean delegation on the way in which it had identified technical assistance needs,
indicating that he had noted them.  He expressed concern regarding the “Special Series Treasury
Cheque”, which appeared to raise problems for investors.
39. The representative of India said that he hoped that Guinea’s efforts would meet with success.
Guinea, as a LDC, should be given technical assistance to develop its economy and participate more
actively in the WTO’s work.
40. The representative of Japan noted that the Guinean delegation had provided comprehensive
explanations and that Guinea’s reform efforts were extremely encouraging.  He asked whether the
provisions that fixed a sum of GF 10 million for foreign direct investment (FDI) and compelled firmswith over GF 50 million of FDI to be under Guinean control were still in force?  He also sought
information on the Multilateral Investment Guaran tee Agency, the creation of the bureau responsibleWT/TPR/M/54
Page 12
for applying the competition law, and transport services.  He urged Guinea to make further
commitments on services and to bind import duties at a lower rate.
41. A representative of Guinea drew attention to the changes in Guinea’s political situation,
indicating that three years of apprenticeship had been  needed following the change of political regime.
He explained that the competition law mainly dealt with the requirements of trade in rice.  Acompetition bureau existed, but was not yet operating.  The individual attitude to regulations on
competition varied. The fact that almost three-quarters of the population was illiterate constituted one
of the major obstacles to the implementation of certain provisions.  He pointed out that the
World Bank had assisted Guinea to revise the preshipment inspection contract signed with the SGS,
which expired in May 1999;  inspection had been introduced mainly to improve the collection of
customs revenue.  It was obvious that the SGS billed its services too high, nevertheless, its action had
made customs officers aware of their responsibilities.  Integration was essential for all Africancountries, including Guinea, which maintained regular contact with the WAEMU countries regarding
trends in inflation, business law and customs matters.  Guinea did not therefore intend to pursue its
development in isolation.
42. He described the major components of the restructuring programme (privatization or
liquidation) for State enterprises still operating.  He confirmed that all export taxes on all products hadbeen abolished, including those on bauxite.  Guinea had contacts with the WIPO in order to acquaint
its officials and economic operators with the content and rationale for the protection of intellectual
property.  Investment in all sectors was free in Guin ea.  He added that he would reply to the question
on the Special Series Treasury Cheque if more details were given because he was not aware of its
existence.  He concluded by stating that Guinea would not remain satisfied with what had alreadybeen achieved because it represented the beginning of a process regarding which questions and
suggestions could be put either at once or after the meeting.WT/TPR/M/54
Page 13
VII. CONCLUDING REMARKS BY THE CHAIRPERSON
43. The first Trade Policy Review of Guinea was conducted by the TPR Body on 25 and
26 February 1999.  These remarks, prepared on my own responsibility, are intended to summarize the
main points of the discussion;  they are not intended as a full report.  Further details of the discussion
will be fully reflected in the minutes.
44. The discussion developed under two main themes:  (i) economic environment;  and (ii) trade
measures and sectoral policies.
(i) Economic environment
45. Members commended Guinea on its unilateral liberalization and economic reforms that had
resulted in sustained GDP growth of almost 5 per cent a year in recent years.  Inflation had been
contained and the trade account was improving.  Noting that progress in addressing the current
account situation had been limited by service deficits, and that export competitiveness was hamperedby high costs of utilities, negative tariff escalation and high taxation of petroleum products, Members
asked about measures envisaged by Guinea to maintain economic growth, diversify exports, promote
the development of the private sector, improve external competitiveness, and combat corruption.
They sought clarification on the link between Guinea's long-term development strategy (Guinea,
Vision 2010) and the ongoing economic reforms.
46. Noting Guinea's limited WTO involvement, part icipants inquired about how this might be
remedied, about progress on trade-related technical assistance under the Integrated Programme, and
about measures to adjust to any reduction of preferences resulting from multilateral liberalization.
Clarification was sought on the current status of implementation of competition legislation and
privatization programmes, on exchange arrangements, and on restrictions on foreign directinvestment.  Some Members asked about Guinea's position with respect to regional agreements and
integration in West Africa.
47. The representative of Guinea responded that continued economic and trade reforms, including
tariff rationalization, would contribute to maintain ing economic growth;  but in this respect the impact
of the refugee situation could not be ignored.  Trade activities had been liberalized, a support center(the Center for Export Formalities (CAFEX)) and the Framework Project for the Promotion of
Agricultural Exports (PCPEA) established, export taxes abolished, and tariff concessions granted,
with a view to promoting and diversifying exports, and regaining Guinea's former market shares.  The
Garafiri dam was being constructed, with financing from the local population and the donor
community, to increase Guinea's self-sufficiency in  energy, and public investment was contributing to
the development of infrastructure.  Privatization of p ublic enterprises, liberalization of supply of basic
services and the establishment of industrial zones were also under way.  These measures, combinedwith statutory and institutional reforms, woul d attract foreign investment.  He noted that
macroeconomic forecasts under Guinea, Vision 2010 were reliant on the successful implementation of
structural adjustment.
48. The representative reiterated Guinea's need for technical assistance, which would also
improve its WTO involvement;  future amendments  to Guinea's tariff would comply with its
multilateral commitments.  On preferential treatment, Guinea, like other African ACP countries,
stressed the need that its commercial position be maintained.  Guinea relied on its comparative
advantages to increase its market access in WAEMU;  future amendments to legislation and tariffs
would take into account similar reform in WAEMU.  He noted that Guinea's trade account had been
in surplus in 1998, due to an increase in mineral and agricultural exports.  He also stressed thatcorruption difficulties were being resolutely addressed.WT/TPR/M/54
Page 14
(ii) Trade measures and sectoral policies
49. Members acknowledged Guinea's significant progress in liberalizing its trade regime.
Applied tariffs on industrial products were around 15 per cent.  However, there was some concern
that:  the structure of border duties remained complex;  import duties on almost all non-agricultural
products were unbound;  there were high margins between bound and applied tariffs;  the appliedDFE rates on rice, flour and vegetable oil were higher than the bound rates;  Guinea's tariff displayed
negative escalation;  the application of the consumption surcharge was discriminatory;  and that
seasonal quantitative restrictions were maintained on potatoes.  Members also asked about plans to
review the fee structure for preshipment inspection.
50. Specific questions were raised regarding Guinea's schedule for adopting a "transaction-value"
basis for customs valuation;  local content schemes;  standards;  measures to promote exports;  the
rationale for export taxation;  participation of the private sector in the analysis of trade problems;workers' representation in the ILO Conference;  and the use of data contained in the Secretariat report
for IDB purposes.  Some Members sought clarification on restrictions affecting certain services
activities.  Information was also sought on plans for further privatization and liberalization of various
sectors of the economy, including agriculture, mining and services, and on exploiting Guinea's
agricultural potential.  Questions arose on Guinea's intentions regarding its limited WTOcommitments in services, especially financial services and telecommunications.
51. Members asked about protection of intellectual property rights in Guinea, including the role
of the Guinean Association for the Promotion of Invention and Innovation (AGUIPA), and about
steps being taken to bring the Bangui Agreem ent into compliance with TRIPS.  Guinea was
encouraged to open its government procurement market to all suppliers.
52. In reply, the representative of Guinea noted that preshipment inspection had been launched in
1996 with a view to improving duty collection;  pr ovisions of the contract between SGS and Guinea
might be amended.  The ongoing amendments to tariff were largely being based on the WAEMU
Common External Tariff and would simplify the structure of Guinea's import duties.  Publication of
the Secretariat report meant that the data it contained could be used for IDB purposes.  The privatesector participated in the national analysis of trade and related policies.  The representative noted that
Guinea needed technical assistance to collect trade data and to implement Guinea's standards
certification system.  He noted that the seasonal prohibition of imports of potatoes had been
abandoned.  On local content schemes, he said that Guinea would comply with its WTO obligations.
The Government Procurement Act was being revised.  In Guinea, workers' associations were privately
run.  The Bangui Agreement on intellectual property rights was being revised to bring it into
conformity with TRIPS.
53. The devaluation of the Guinean franc, liberalization reforms, private investment and the
dismantling of controls on producer prices had contributed to an increased agricultural production;
food security was the major objective of agricultural policies in Guinea.  Major policy objectives in
the mining sector included the restructuring of companies, the adoption of an institutional and
juridical framework, and the construction of infrastructure.  The services sector was liberalized.However, the lack of investment, including FDI, delayed the privatization of companies such as
Air Guinea and SOGETRAC.  Guinea needed technical assistance to improve its multilateral
commitments in trade in services.
54. In conclusion, it is my strong feeling that Members welcomed the participation by Guinea in
the review process and expressed their appreciation for significant steps taken by Guinea towards amore outward-oriented, market-driven economy, with social development a priority.  Members
recognized the difficulties inherent in such a significant economic adaptation, particularly given the
challenges faced by Guinea as a least-developed country, with a formerly centralized
planned-economy system.  They strongly encouraged Guinea to consolidate and build on theWT/TPR/M/54
Page 15
achievements of recent years.  Members were also very conscious that, if the policies pursued
domestically are to achieve the desired results, it would be important that Guinea continue to build a
favourable environment for private capital and that it receive support at the regional level and within
the multilateral trading system.WT/TPR/M/54
Page 16
ANNEX I
ADVANCE WRITTEN QUESTIONS
WRITTEN QUESTIONS FROM HONG KONG , CHINA
Inspection, Customs Valuation and Payment of Duties and Taxes(WT/TPR/S/54, pp. 26-27, para 9, Box III.1)
It is reported that Guinea has been applying an import verification programme for some years.
The inspections are carried out solely by SGS and the cost of its services is 1.05 per cent of the f.o.b.value of the goods, with a minimum amount equivalent  in Guinean francs to Sw F 430.  It is also
mentioned that since inspection costs are borne directly by the importers, preshipment inspection
increases the level of protection of similar goods or their locally produced substitutes.  We are
interested to know whether the Guinean Government has any plan to review the fee structure for
preshipment inspection, in particular the minimum inspection fee of Sw F 430 and the minimumthreshold of US$5,000 beyond which inspection is required.
(WT/TPR/S/54, pp. 27-28, para. 10)
It is mentioned that Guinea has not yet adopted the definition of customs value in the
WTO Agreement and has not had recourse to the delayed application allowed to developing countries
by Article 20 of the Agreement on Implementation of Article VII of the GATT 1994.  Would the
Guinean Government share with us its plan in meeting the above-mentioned requirements?
Import duties
(WT/TPR/S/54, pp. 29-36, paras. 19-36)
We note that the existing tariff structure is rather complicated with different kinds of duties,
taxes and surcharges.  Does Guinea have any plans to simplify its tariff structure and reduce the duty
rates so as to create a more facilitating environment for trade?
Other Duties and Taxes
(WT/TPR/S/54, p. 31, para. 25)
We note that Guinea has been levying a consumption surcharge on "luxury products" since
1986.  We note that products like paints and varnishes, PVC tubes and pipes as well as aluminum
sheet and strip, which are not commonly considered as luxury items, are also subject to this
consumption surcharge.  We wonder whether Guinea has any plan to exempt these products from the
consumption surcharge.
Air and Land Transportation
(WT/TPR/S/54, pp. 69-70, paras. 88-89 an d WT/TPR/S/54, pp. 9-10, para. 33)
We note that Air Guinée and SOGETRAG are public enterprises and are in the process of
privatization.  We would like to know more information on the plans and the time-frame.WT/TPR/M/54
Page 17
Financial Services
(WT/TPR/S/54, p. 71, para. 95)
It is mentioned that both nationals and foreigners may open a bank in Guinea provided that at
least 20 per cent of the capital is owned by a bank of international repute.  What is a "bank of
international repute"?  Are financial institutions of all foreign countries afforded equal opportunity to
be recognized as having international repute?  Are there any specific criteria?
Telecommunications and Postal Services
(WT/TPR/S/54, p. 76, para. 116)
We note that basic telecommunication services are monopolized by SOTELGUI. In 1995,
SOTELGUI opened its capital to Telekom Malaysia Berhard (TMB) which now holds 60 per cent of
the capital.  We would like to know whether Guinea  has any other long term plans to further liberalize
the basic telecommunication services sector.
JAPAN 'S QUESTIONS TO GUINEA
Tariffs
(1) Import duties on the products of HS Chapters 45, 47, 66 and 86 have been bound at 80 per
cent. However, other industrial products are unbo und. Why are those products  unbound?  (C hart III.1
(p. 32) and para. 30 (p. 34) of the Secretariat Report).
What is the ratio of binding?
Applied tariff rates of industrial products are around 15 per cent.  Please explain Guinea's
view on binding tariff rates at the level of its applied tariff rates.
(2) It is reported that the current customs valuation procedure is based on the Brussels Definition
of Value and that Guinea has therefore not yet adopted the definition of customs value in the WTO
Agreement (para. 10, p. 27).
Please explain why Guinea has not had recourse to the delayed application allowed to
developing countries by Article 20 of the Agr eement on Implementation of Article VII of the
GATT 1994.
Please explain the schedule for adopting the definition of customs value in the WTO
Agreement.
Investment
(1) Investment code (para. 21, p. 19)
(a) Please explain why foreign direct investment in Guinea must be for at least
GF 10 million.
(b) Is it not allowed at all to make foreign direct investment less than GF 10 million or is
it possible under special regulation?
(c) Please explain regulations applied to foreign direct investment less than
GF 50 million other than control of the enterprise by a Guinean national.WT/TPR/M/54
Page 18
(d) Are there any provisions in the investment  code to expropriate or nationalize the FDI
assets?  If so, please outline the scheme.
(e) Please outline the dispute settlement mechanism concerning foreign direct
investment.
(2) Please explain the objective and the content of the Convention Establishing the Multilateral
Investment Guarantee Agency (para. 43, p. 24).
Standards
(1) The Secretariat report states that imported products must comply with approved national
standards (para. 47, p. 38).
Are the standards applied to imported products the same as those applied to domestic
products?
Please explain mandatory standards which are applied only to imported products, if any.
(2) Does Guinea have a schedule to set up the "national certification system?" (para.49, p. 38).
Competition
It is reported that the Law of December 1994 defines anti-competition practices but that such
practices are not currently monitored as the department responsible is being organized (para. 86,
p. 46).
Please explain the schedule for establishing a responsible department to monitor such
practices.
Please explain how the department is expected to monitor such practices.
Services
(1) Transport services (para. 81, p. 68)
Does Guinea intend to privatize Société navale guinéenne  (SNG), a state-owned company
which is responsible for freight other than ores?
Please explain the formation of capital of GUINOMAR, a semi-public company which is
responsible for the transportation of ores.
(2) Tourism, hotel and restaurant services (para. 110, p. 75)
It is reported that the measures taken under the various programmes enabled the management
of the hotels partly owned by the Government to be entrusted to international hotel chains.  Please
explain the criteria to choose a trustee.
(3) Telecommunications and postal services (paras 113, 114, p. 75)
(a) Does Guinea have any plan to liberalize basic telecommunication services, which are
currently under monopoly of the SOTELGUI?  If any, please explain the schedule for
liberalization.  If not, please explain why Guinea does not liberalize this field.WT/TPR/M/54
Page 19
(b) It is reported that in December 1995 SOTELGUI opened its capital to Telekom
Malaysia Berhard (TMB) and that 60 per cent of the capital is held by TMB.
Is the share owned by TMB still 60 per cent?
Is the capital of SOTELGUI open to other foreign suppliers?  If not, please explain
the reason.
QUESTIONS FROM THE UNITED STATES
What specific steps or strategies are being taken by the Government of Guinea to diversify
exports?
The Office for the Promotion of Private Investment (OPIP) is tasked with encouraging the
development of the private sector.  What specific steps, programmes or platforms are used to promote
private sector development in Guinea?
According to the Secretariat report, the definition of trade policy is preceded, particularly at
the sectoral level, by consultations between the technical ministries and private institutions.  The
report further notes that the Government of Guinea is considering the use of academic or other
research institutions for assessing and drawing up trade policy.  We encourage the Government of
Guinea to use these different inputs in analyzing its trade policies.  Has Guinea considered an
independent analysis of its policy of negative tariff escalation?
We note that Guinea is party to the African Intellectual Property Organization (AIPO), also
known as the Bangui Agreement.  What has Guinea done within AIPO to bring the Bangui Agreement
intellectual property provisions into full conformity with the WTO TRIPS agreement?
According to the Secretariat's report, the Guin ean Association for the Promotion of Invention
and Innovation (AGUIPI) was established in August 1997 to contribute to the economic, scientific
and technical development of Guinea through the promotion of technical inventions and innovations
and the protection of the interests of inventors and innovators.  We are interested in knowing more
about AGUIPI and its role in protecting intellectual property rights.  Does AGUIPI have enforcement
powers?
We applaud the efforts being made to bring the agricultural sector up to the level of quality
and production it once maintained.  Efforts to become self-sufficient in food production will continue
to pay high dividends to the Guinean economy.  Can you describe the promotion efforts of the
Support Center for Export Formalities (CAFEX ) and Framework Project for the Promotion of
Agricultural Exports (PCPEA)? Are these programmes developing as you want them to?  We are alsointerested in Guinea's plans to develop its cotton production.  Please describe what is being done with
the Caisse Française de Développement  (CFD) to develop the structure for increased cotton
production and the current status of these efforts.
The manufacturing sector in Guinea has been liberalized, yet remains undeveloped.  It
appears that this is owing to the high cost of certain inputs and the general negative escalation of
import duties. Please comment on this and explain what is being done to help develop the
manufacturing sector.
The services sector has potential in Guinea, particularly in the areas of tourism and
transportation. What is being done to encourage and liberalize these and other services sectors?  Has
Guinea given consideration to participating in  the WTO agreements on basic telecommunication
services and financial services, as a means to develop infrastructure and make Guinea a more
attractive venue for investment?WT/TPR/M/54
Page 20
The Government of Guinea (GOG) continues to designate the National Confederation of
Guinea Workers (CNTG) to represent workers in the International Labor Organization Conference.
When will the CNTG or other trade unions and confederations be allowed independent representation
by the GOG at the ILO conference?
According to the Secretariat's report, Guinea has made only four notifications to the
World Trade Organization.  We are conscious of the difficulty of Members with small delegations to
participate actively at the WTO.  Nevertheless, we do believe that active participation is essential for
Members to obtain the greatest benefits from their WTO membership and we hope that you will be
able to be more actively involved in the WTO in the future.
PRELIMINARY REMARKS AND QUESTIONS BY THE EUROPEAN COMMUNITY
The European Community considers that the systematic intervention of a preshipment
inspection company for all imports of a value ex ceeding a certain figure to be an excessive
impediment to trade, preventing or delaying as it does the valuation of the goods in accordance with
the rules of the Agreement on Customs Valuation and increasing the level of protection by making the
cost of trade operations for importers artificially more expensive.  Could the delegation of Guineaexplain why it was decided to have recourse to the services of such a company?  Could the delegation
also indicate whether its Government has consid ered the possibility of modernizing its customs
administration and automating procedures as an alternative to such services?
Insofar as Guinea is still applying the Brussels Definition of Value rather than the definition
in the Agreement on Customs Valuation, why has it not notified a delay in application under
Article 20 of that Agreement?  Could the delegation of Guinea also indicate whether steps are being
taken to move to transaction value as from the year 2000 at the latest?  Is the fact that Guinean
customs officers are still being trained on the basis of the Brussels Definition likely to facilitate such a
change-over?
Could the delegation of Guinea indicate whether its Government intends to eliminate the
discriminatory aspects (favouring local products) of the way it taxes goods subject to the consumption
surcharge?
Could the delegation of Guinea explain precisely what has happened to the
Schedule CXXXVI tariff bindings which apparently predate the country's accession to independence?Insofar as these bindings have not been fully transferred to Guinea's new tariff listing, have these
withdrawals of concessions ever  formed the subject of a notification and negotiations under
Article XXVIII of GATT 1994?
Is Guinea willing to transmit its tariff and import data to the Integrated Database (IDB) set up
by the Committee on the country's accession to independence?  Insofar as most of these data have
already been communicated to the Trade Policies Review Division in the context of the present trade
policy review, could Guinea authorize the WTO Secretariat to include the said data in the IDB?
Is Guinea convinced of the appropriateness and effectiveness of the local content
requirements it imposes as a condition for the granting of certain tax or customs advantages?  Is the
Government thinking of abolishing provisions of this kind so as to conform to the WTO rules?
Is the Government of Guinea intending to make its present exchange control system more
flexible?  Is it aware that the introduction of the Special Series Treasury Cheque (CTSS) is adiscouragement to investment?  Is it thinking of specifying the procedure for applying the CTSS or
even abolishing it?WT/TPR/M/54
Page 21
ANNEX II
REPLIES BY THE GUINEAN AUTHORITIES TO THE QUESTIONS RAISED
I. ECONOMIC ENVIRONMENT
1. Measures envisaged to sustain economic growth
Until the early 1980s, Guinea had a highly centralized economy, but since 1986 it has been
fully liberalized as a result of the economic and financial reforms adopted following the change of
political regime in 1984.
The authorities that took over following the change of regime in 1984, which created a new
political and economic system for administering the country (introduction of multiparty democracy
and a market economy), have undertaken large-scale economic and financial reform programmes
since 1985 in order to redress the situation, with help from some of Guinea’s major development
partners, notably the World Bank and the International Monetary Fund (IMF).
Since 1985, Guinea has implemented an Economic and Financial Reform Programme (PREF)
with the support of the World Bank and the IMF, including three (3) Structural Adjustment
Programmes.  In 1991 and 1996, the IMF approved tw o three-year Enhanced Structural Adjustment
Facilities (ESAF) for Guinea.
The main objectives of these reforms were to reinstate a market economy, restore the major
macroeconomic balances, revive growth and improve the living conditions of the Guinean population.
Within this framework, the following practical measures were taken:
- State withdrawal from all production and commercial activities;
- complete restructuring of the banking system;
- change of currency;
- readjustment and liberalization of the exchange rate;
- liberalization of prices and trade through the adoption of specific tariff measures;
- enhancement of the legal framework for business.
Guinea has adopted the legal texts needed to cr eate the right conditions for achieving the
objectives of reform, namely:  the Investment Code, the Labour Code, the Code of Economic
Activities, the Government Procurement Code, th e Mining Code, the Forestry Code, the Property
Code, the Fisheries Code and the Customs Code.  All these Codes are designed and based on very
liberal principles that will foster the development of such activities in Guinea.  They reaffirm freedomof enterprise and guarantee private property, as well as equal treatment before the law for national and
foreign operators.
The unsatisfactory results of the initial measures made it necessary to define new objectives
in 1996 so as to make Guinea’s economy more competitive and thus boost growth.  The measuresinclude:
- Achieving economic growth in real terms of around 4.9 per cent of GDP per year;
- lowering the rate of inflation, currently 5.1 per cent compared with 70 per cent in
1987;
- reducing the external current account deficit so as to build up a substantial level of
official reserves;
- decreasing the budget deficit;WT/TPR/M/54
Page 22
- increasing primary savings;
- diminishing the deficit in the balance of payments current account;
- strengthening and improving the legal and institutional framework;
- improving primary education and enhancing the quality of education services;
- upgrading human resources;- in 1996, adoption of a Programme for the Security of Customs Revenue,
implemented in cooperation with an inde pendent international inspection company
(SGS);
- narrowing the gap between the official exchange rate and the informal rate from
1,600 per cent to 5 per cent;
- raising the price of agricultural products by 3,000 per cent;
- increasing the share of private sector credit from 5 per cent to 70 per cent (the major
part going to short-term commercial activities);
- multiplying by five the amount of foreign currency available to the private sector;
- creating production sectors and organizing some of them (onions and potatoes,
coffee, cotton, fruit and vegetables, timber, etc.);
- developing infrastructure services (ports);- reinforcing private initiative through the creation of a large number of SMEs,
generally in trade;
- bringing back Guinean professionals working abroad;
- attracting foreign investors;
- better knowledge of the channels for marketing domestic production.
In order to make exports more competitive, like the WAEMU countries, Guinea is studying
ways of correcting the negative escalation of duties in comparison with exports.  The conclusions of
this study and continued far-reaching reform should allow Guinea’s economic growth to be sustained
in future years.
2. Measures taken to diversify and develop exports
In the trade sector, the reforms put into effect have mainly consisted of drawing up and
adopting new trade policies that liberalize the exercise of trade by economic operators without
distinction.
The major goal of these new policies is essentially to develop the trade sector so as to make it
a leading instrument of support for the production sector (industry, agriculture, crafts, fisheries) and
enable it to play to the full its role as a catalyst for accelerated growth and economic development in
Guinea.
In practice, in the trade sector, the liberalization of economic activities in Guinea has involved
the following:
- Transfer to the private sector of all the commercial activities formerly carried out by
the State;
- creation of new structures to support and promote the private sector;- continued implementation of the programme to set up export facilitation
infrastructures;
- integration of trade into the production process with active private sector
participation;
- definition and improvement of trade regulations;- harmonization and adaptation of Guinean laws and regulations to bring them into line
with the new requirements of the multilate ral trading system resulting from the WTO
Agreements.WT/TPR/M/54
Page 23
The following has been done to achieve these goals:
- Promotion of domestic trade by encouraging trade among the country’s various
regions so as to offset a deficit in one region by a surplus in another;
- development of exports of non-traditional products for which Guinea has large
potential and a clear comparative advantage and which are in demand on foreign
markets;
- creation of the conditions for more active participation in global trade in securities
and goods by acceding to the World Trade Organization (WTO);
- renewed impetus for the marketing of products (agricultural, industrial, crafts) by
involving more traders in operations and in the financing of production;
- giving operators the possibility of exploiting the opportunities afforded under
bilateral and multilateral trade agreements;
- restructuring and revival of sub-regional trade so as to lessen the impact and
distortion caused by informal transborder trade;
- adaptation and harmonization of Guinea’s trade policy with the policies of
international institutions (WTO, UNCTAD, ICC);
- support for the installation and expansion of preserving and processing equipment
and facilities needed for a better definition of Guinean origin;
- broadening the bases for ongoing consultation between the public and private sectors.
To achieve these objectives in full, Guinea ha s pursued the reforms already undertaken in this
area, in cooperation with its development partners.
The following were the principal areas of activity in this connection:- Improving the regulations on carrying out commercial activities in Guinea, taking
into account the new situation at the national and international levels;
- training officials dealing with fiscality so as to ensure that their activities show the
necessary transparency;
- enhancing the services provided by trade auxiliaries (postal services, transport,
transit, banking, insurance, etc.).
The Government is therefore continuing its efforts to:- Guarantee and preserve the full liberalization of the trade professions;
- ensure the maintenance of a free price and competition policy;
- streamline the formalities for setting up enterprises;
- promote crafts and tourism;- broaden the bases for ongoing consultation with the private sector.
The promotion and growth of exports of Guinean products have been among the major goals
of Guinea’s new trade policy since it was first defined in 1986.
In this regard, it should be noted that priority has been given to regaining the international
market share previously held by Guinean products from 1958 to 1960 (100,000 tonnes of bananas,
45,000 tonnes of coffee, 150,000 tonnes of palm oil, etc).
To reach these objectives, the Government will strengthen the provisions needed to:- Develop exports of non-traditional products in demand on foreign markets for which
Guinea has large potential;
- encourage investors (domestic and foreign) to participate in export-oriented
production sectors;WT/TPR/M/54
Page 24
- develop partnerships under bilateral, plurilateral and multilateral agreements so as to
create a large number of outlets for Guinea’s export products.
The Government has already taken a number of measures in this regard, including the
following:
- The abolition of the 2 per cent customs tax on exports and the 5 per cent tax on
processing;
- the granting of tariff concessions, including the temporary admission scheme for
packaging and other material to be used for export products;
- the introduction of a Framework Project for the Promotion of Agricultural Exports
(PCPEA) in cooperation with the World Bank.  The Project currently ensures thegrowth of agricultural exports through three components related to quality, processing
and f.o.b. conditions;
- the establishment of a Support Centre for Export Formalities (CAFEX) (single
window for exports).
3. Measures taken and/or planned to enhance the competitiveness of enterprises
The reforms on which Guinea has embarked since 1986 are mainly based on State withdrawal
from all production activities, leaving the private sector to take over.
The State has thus been left with the role of creating an environment favourable to the
development of private sector activities.  Guinea has therefore adopted the necessary legal texts,
namely, the Investment Code, the Labour Code, the Code of Economic Activities, the Government
Procurement Code, the Mining Code, the Forestry Code, the Property Code, the Fisheries Code, and
the Customs Code.
In addition to these texts, other practical measures have been taken by the Guinean authorities
to enhance the competitiveness of enterprises, including the following:
- Introducing a single window for the creation of enterprises, exports and, in the near
future, imports;
- defining areas within industrial zones and handing them over to entrepreneurs;
- granting facilities for the import of capital goods to be used for production;- acceding to several sub-regional, regional and international trade agreements and/or
arrangements thus providing outlets for Guinean products;
- improving services by trade auxiliaries;
- privatizing the telecommunications sector;
- investing in energy (construction of the Garafiri dam).
4. Measures planned to improve the current account or attract foreign direct investment
Guinea’s firm decision in favour of a liberal economy has made it necessary to take a certain
number of general measures with the objective inter alia  of:
- Restoring major macroeconomic balances;
- reviving production;
- enhancing Guinea’s image on the international scene.
Some of the measures already mentioned above such as the adoption of basic legal texts (the
Investment Code, the Customs Code, the Fisheries Code, the Mining Code, the Property Code, etc.)
have been taken in order to create the conditions essential for economic revival, and to attract and
keep direct investment both from within the country and from abroad.WT/TPR/M/54
Page 25
It must be emphasized that many Guinean citizens in possession of significant resources lived
outside Guinea before the reforms.  When the conditions favourable to the development of investment
in Guinea became known, there was a huge influx of potential investors who saw Guinea as a new
forum for their business activities.
In this context, for over six years, the Government has been endeavouring to attract
investment, using all appropriate means and taking the following practical measures:
- Liberalization of prices;
- streamlining the formalities for setting up enterprises (single window);
- simplifying entry and residence requirements for foreigners;
- improving the judicial structure;- developing certain basic infrastructures (water, electricity, communications,
telecommunications, etc.);
- organizing forums in Guinea with participation by foreign investors (the latest took
place in May 1998 and brought together more than 500 participants, 300 of them
from outside Guinea);
- flexible exchange rates.
The problem of the inadequate supply of electricity will soon be resolved when the Garafiri
hydroelectric dam (75 MW) comes on line and the completion of a deep-water port should resolve
maritime transport difficulties and make an effective contribution to attracting foreign directinvestment, thereby improving the current account.
In relation to the elaboration of promotion policies, it should be noted that the Government
closely involves the private sector through its representative associations (Chamber of Commerce,
Chamber of Agriculture, Chamber of Mines, em ployers’ associations, business associations,
Interprofessional Confederation of Coffee and Cocoa Bean Exporters, Union of Industrialists, etc.), as
well as academic institutions.
5. Competition policy
In acceding to the WTO, Guinea sought to give its economy a transparent and competitive
character.
In practice, this has led to the adoption of relevant laws and regulations.
One example is the Law of December 1994 on competition and pricing.The private sector has been closely involved in the drafting of this law and its
implementation.  Problems still exist, however, regarding the actual application of its provisions by all
economic operators.  To remedy this and other problems, the Government organized a national
seminar in Conakry from 25 to 27 January 1999 on the concept of competition and the various forms
it took in the economy.  All sectors of activity (private and official) participated in the seminar, which
resulted in solutions being proposed to the basic problems of competition in Guinea.
6. Integration of the “Guinea, Vision 2010” strategy in economic reforms
The integration of the “Guinea, Vision 2010” strategy in other economic reforms, especially
in the Structural Adjustment Programme (SAP).
The “Guinea, Vision 2010” strategy is essent ially a forward-looking strategy for Guinea’s
major economic development objectives on a sector-by-sector basis.  There cannot therefore be anyWT/TPR/M/54
Page 26
disparity between the strategy and Guinea’s objectives under the Structural Adjustment Programme
(SAP).
The SAPs adopted by the Government in close collaboration with its development partners
constitute the different stages in the implementation of the strategy and are based on the sectoralpolicy components designed by the competent national authorities.
Naturally, certain problems have been encountered, but the Government, with the support of
the international community, is determined to ac hieve the major objectives fixed in the “Guinea,
Vision 2010” strategy (organization of the Advisory Group, Paris, June 1998).
7. Participation in the work of the WTO
Like the majority of LDCs and developing countries, Guinea was not directly involved in the
Uruguay Round negotiations that led to the conclusion of the Agreement establishing the WTO.
For the majority of Guineans, therefore, the WTO and the Agreements have yet to become
known and understood before they can be effectively utilized as new opportunities to be seized withinthe multilateral trading system.
In order to participate more actively in the WTO’s work in every respect, Guinea has
requested technical assistance, not only for the purpose of better understanding of the WTO and its
complex provisions but also to help it fulfil its commitments as a member of the Organization.
It may be recalled that this technical assistance is mainly for the training of Guinean trainers
on WTO matters by organizing seminars and round tables in Guinea and study trips or courses at the
WTO, etc.
Guinea is grateful to the WTO for the aforementioned assistance, but wishes to take the
opportunity to reiterate its request, which has not yet been met, and ask its development partners to
intervene to ensure that its objective is achieved.
Guinea acceded to the GATT during the last days of that organization’s existence.In order to do so, like other countries, it bound its customs duties in the fourth customs tariff
adopted by the authorities.
Following the changes in the economic situation not only in Guinea but in the sub-region and
the world as a whole, Guinea is currently revising its customs tariff.
The revision will of course take into account the requirements of the situation at the
international, regional and sub-regional levels, particularly at a time when the WAEMU member
countries are adopting a Common External Tariff.
8. The current EEC/ACP negotiations
As a LDC, Guinea’s economy is vulnerable and is characterized by low production capacity,
the import of almost all consumer goods, including basic foodstuffs, and the predominance of
unprocessed raw materials in the total volume of exports.
This situation means that Guinea is one of the countries that would like to see the advantages
granted to ACP countries maintained.WT/TPR/M/54
Page 27
9. Sub-regional integration
With regard to sub-regional integration, Guinea is an active participant and is tirelessly
working towards the rapid achievement of this obj ective, which does not in any way contradict the
provisions of the new multilateral trading system that emerged from the Uruguay Round.
On the contrary, economic and trade practices that have proved their worth in the country of
origin and in the sub-region (or region) are the most likely to succeed on international markets.
Guinea is taking advantage of its situation as a non-member of the WAEMU to boost its
economy so as to benefit from certain comparative advantages it possesses, related inter alia  to its
favourable climate, in order to conquer the WAEMU market, which is the largest in the sub-region.
It should be recalled in this connection that some measures have been taken, including the
revision of the customs nomen clature (along WAEMU lines).
10. Guinea’s trade balance
In 1998, Guinea’s trade balance showed a surplus.  This was mainly due to the increased
volume of exports by the mining industry (18 million tonnes of bauxite compared with 15 million
tonnes in 1997) and agricultural exports (22,000 tonnes of coffee compared with 19,000 tonnes in
1997;  and 40,000 tonnes of cotton comp ared with 15,000 tonnes in 1997).
II. TRADE MEASURES AND SECTORAL POLICIES
1. Customs valuation, preshipment inspection, tariffs (binding, complexity, other duties
and charges)
Guinea, like almost all other LDCs and developing countries, was not directly involved in the
Uruguay Round negotiations so it needed some time to apprehend the very complex provisions
contained in the various WTO Agreements.  This is also why it requested technical assistance fromthe WTO to help it make the notifications required, meet its commitments on binding in conformity
with the Uruguay Round Agreements and apply the WTO customs valuation mechanism by the
year 2000.
Preshipment inspection of the quantity, quality and price of goods imported into  Guinea
under the Programme for the Security of Customs Revenue introduced by the Guinean Government in
1996, in collaboration with the SGS, is not in any way intended to protect local products to thedetriment of similar imported products.
Through inspection, the Government merely seeks to:- Halt capital flight caused by over-invoicing;
- reduce imports of goods unfit for consumption;
- ensure the maximum amount of revenue for the State from customs sources.
During discussions on renewal of the contract ways will be sought to modify certain
provisions.
Since independence, Guinea has adopted five different customs tariffs in order to adapt its
customs legislation to the development needs of its economy and the sub-regional, regional and global
economic situation.WT/TPR/M/54
Page 28
The latest customs tariff was adopted in January 1998 and is still being revised.  It will be
extremely simple and take full account of the Common External Tariff (CET) recently adopted by the
WAEMU countries.
Steps will shortly be taken to move from customs valuation based on the Brussels
nomenclature to the customs valuation system contained in the WTO Agreements.  The adoption of
these measures is one of the provisions envisaged for more active participation by Guinea in the
WTO’s activities.
Guinea does not yet have sufficient information regarding the Integrated Database and
therefore seeks assistance to enable it to familiarize itself with the Database.
In any event, as the reports prepared for the review of its trade policy will be published, the
information contained therein will automatically become part of the public domain.
2. Quantitative restrictions;  content of national origin
This only applies to a very limited extent in Guinea and originally concerned potatoes whose
domestic production did not exceed 500 tonnes annually.  It was an ad hoc measure and is no longer
applied.
With regard to content of national origin, the Guinean delegation has noted this issue and will
ensure that it is brought into line with Guinea’s commitments as a member of the WTO.
3. Standards
Since reforms were first initiated in 1986, Guinea has set up a number of State structures to
support the activities of private economic operators.  These include the National Standardization and
Metrology Institute (INNM).
The Institute is currently preparing standards for Guinea’s exports so that there is a precise
definition of the label “Guinea” on foreign markets.
It has already drawn up three (3) standards, including one (1) for coffee, and these have been
published and are in effect throughout Guinea.
The Institute suffers from a severe lack of financial and material resources to allow it to
develop its activities and reach the objectives fixed, namely, the definition of standards for all
Guinea’s export products.
The assistance sought in this regard relates to the introduction of a national certification
system to promote Guinean products abroad by:
- Strengthening the capacity of the Centre for Information and Documentation on
Standards by supplying background documentation on reference standards (foreign
and international);
- reinforcing the system for drawing up Guinean standards for exports;
- establishing testing and metrological control laboratories;
- supplying computer and data processing equipment;
- preparing a training programme and raising the level of officials in the area of
standardization, metrology and quality.WT/TPR/M/54
Page 29
4. Government procurement
Since the liberalization of Guinea’s economy, the State has completely withdrawn from all
production activities.  The legal framework for the activities of private economic actors has been
introduced.
One of the instruments used to implement this liberal policy is the Government Procurement
Code, which was revised one year ago.  It defines the terms for Government procurement, which is
now solely through tenders.
A Government Procurement Journal is published regularly and provides the business
community with the information needed.  Guinea is gradually amending its domestic legislation on
procurement.
5. Measures affecting exports
In the general context of Guinea’s trade, it should be emphasized that the promotion and
growth of exports of Guinean products have been among the major goals of Guinea’s new trade
policy since it was first defined in 1986.
In this regard, it should be noted that priority will be given to regaining the international
market share previously held by Guinean products from 1958 to 1960 (100,000 tonnes of bananas,
45,000 tonnes of coffee, 150,000 tonnes of palm oil, etc.).
To reach these objectives, the Government will strengthen the provisions needed to:
- Develop and diversify exports of non-traditional products in demand on foreign
markets for which Guinea has large potential;
- encourage investors (domestic and foreign) to participate in export-oriented
production sectors;
- develop partnerships under bilateral, plurilateral and multilateral agreements so as to
create a large number of outlets for Guinea’s export products.
The Government has already taken a number of measures in this regard, including the
following:
- The abolition of the 2 per cent customs tax on exports and the 5 per cent tax on
processing;
- the granting of temporary admission for packaging and other material to be used for
export products;
- the establishment of a Support Centre for Export Formalities (CAFEX) (single
window for exports).
In any event, other measures will be taken to continue the full liberalization of Guinean
exports so as to enhance their competitiveness on foreign markets.
6. Labour – ILO
With the change in regime that led to political democratization in Guinea based on freedom of
association, a number of trade unions were set up, each of which set goals to be met without State
intervention.WT/TPR/M/54
Page 30
7. Intellectual property
Guinea has signed the Bangui Agreement and applies its provisions.  The Agreement is being
revised, however, and Guinea will also bring its measures into line with WTO commitments under the
new multilateral trading system.
8. Agriculture:  development (cotton, vegetable oil, rubber)
Together with the mining sector, agriculture is one of the two catalysts for Guinea’s economic
growth.  From 1994 to 1996, it accounted for 20.42 per cent of the GDP.  It employs 87 per cent of
the working population, of whom 93 per cent work in agriculture as such.
The abolition of regulations, the devaluation of th e currency, the increase in the prices paid to
rural producers and the liberalization of trade have given farmers renewed confidence and have led toa revival of agricultural production underpinned by large-scale investment.
For the agricultural sector as a whole, the long-term goal clearly identified by the Government
is to promote food security and enhance the performance of agricultural production.
In order to achieve this, the following strategies have been adopted:
- Improving the performance of agricultural services together with a policy on State
withdrawal from production and marketing;
- raising the productivity of farms and promoting a dynamic private agricultural sector
so as to increase the number of jobs in rural areas;
- increasing exports of agricultural products (coffee, cotton, cereals, fruit) and reducing
food imports;
- reorganizing the use of natural resources and protecting the environment;
- promoting agri-industry and processing units in order to exploit agricultural
production.
9. Sectoral matters
The mining sector has long been the driving force of the Guinean economy, accounting alone
for more than one third of the country’s GDP.  With its potential and the prospects for exploiting it,
this sector will be called upon to play an increasingly important role in the country’s economy.
The following are among the objectives sought in this regard:
- The strengthening and restructuring of existing companies such as the Compagnie des
Bauxites de Guinée (CBG), the Société Friguia , the Société des Bauxites de Kindia
(SBK), the Société aurifaire de Guinée (SAG), the Projet diamants kimberlitiques ;
- the adoption of a more attractive institutional, legal and financial framework (Mining
Code, introduction of a single window for mi ning investors called the Centre for the
Promotion and Development of Mining ( Centre de promotion et de développement
miniers - CPDM));
- the completion in the medium term and long term of large-scale mining projects such
as:
- the integrated aluminium factory project – 200,000 t/year;
- the Dian Dian alumina and bauxite complex – 1,000,000 t/year;
- the Nimba Simandou project and the Transguinean railway with a deep-water
port.WT/TPR/M/54
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It should be noted that the aforementioned projects require the mobilization of a large amount
of capital, several billion United States dollars, and this, in itself, is one of the major objectives of the
Government in its effort to achieve sustainable development.
In this important sector of Guinea’s economy, control-reduction measures to promote and
develop exports on a permanent basis will be taken in support of the investment efforts made by
operators.
10. Services:  air and land transport;  tourism;  telecommunications – monopolies;  foreign
direct investment, WTO Agreements;  financial services – liberalization
Financial services
Financial services in Guinea are supplied by units of the banking system, the insurance
companies and the decentralized credit and savings structures.  The contribution of financial services
to GDP formation is around 8.5 per cent.
As far as opening banks is concerned, Guinea’s banking legislation allows both nationals and
foreigners to operate.
The requirement regarding 20 per cent of the capital applies to first-grade banks generally
recognized as such worldwide.  If a foreign bank  meets this criterion, it can without discrimination be
involved in setting up a bank in Guinea.  In other words, the financial sector in Guinea has been fullyliberalized.
Air and land transport
Like other sectors of activity in Guinea, the transport sector has been fully liberalized.  This
has allowed private operators to take over from the State.
Private operators supply the majority of land and air transport.In order to complete the privatization of the transport sector, Guinea has for some time been
seeking to privatize Air Guinée and SOGETRAG.
Telecommunications and postal services
There is in principle no monopoly in the telecommunications and postal services sector in
Guinea.  Any operator may carry out activities in this sector in accordance with the relevant
regulations.
Nevertheless, measures will still be taken to complete the full-scale liberalization of this
sector and allow other operators to provide basic infrastructure services.
In general, information on services in Guinea is very limited. Undertaking firm commitments
in connection with Guinea’s obligations to the WTO implies thorough knowledge of the mechanisms
in the General Agreement on Trade in Services.  Technical assistance is also needed in this area so as
to give Guinea a better understanding of the Agreement and enable it to adapt itself to the relevant
provisions.
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