RESTRICTEDWORLD  TRADE
ORGANIZATIONWT/TPR/S/54
8 January 1999
(99-0016)
Trade Policy Review Body
TRADE POLICY REVIEW
GUINEA
Report by the Secretariat
This report, prepared for the  Trade Policy Review of Guinea, has been drawn up
by the WTO Secretariat on its own responsibility.  The Secretariat has, as
required by the Agreement establishing the Trade Policy Review Mechanism
(Annex 3 of the Marrakesh Agreement Establishing the World Trade
Organization), sought clarification from the Government of Guinea on its trade
policies and practices.
Document WT/TPR/G/54 contains the policy statement submitted by the
Government of Guinea
Note: This report is subject to restricted circulation and press embargo until the end of the meeting
of the Trade Policy Review Body on Guinea.Guinea WT/TPR/S/54
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CONTENTS
SUMMARY OBSERVATIONS vii
(1) ECONOMIC ENVIRONMENT vii
(2) INSTITUTIONAL FRAMEWORK viii
(3) TRADE POLICY FEATURES ix
(i) Trade policy instruments and their impact ix
(ii) Policies by sector xi
(4) TRADE POLICIES AND TRADING PARTNERS xii
I. THE ECONOMIC ENVIRONMENT 1
(1) MAJOR FEATURES OF THE ECONOMY 1
(2) ECONOMIC DEVELOPMENTS 3
(i) From independence to the 1980s 3
(ii) Economic situation in the 1990s 4
(3) TRADE PERFORMANCE 7
(i) Trade in goods 8
(ii) Trade in services 10
(4) INVESTMENT 10
(5) OUTLOOK 11
II. TRADE AND INVESTMENT REGIMES 15
(1) INSTITUTIONAL FRAMEWORK 15
(2) FORMULATION AND IMPLEMENTATION OF POLICIES 15
(3) POLICY OBJECTIVES 17
(4) LAWS AND REGULATIONS 17
(i) Trade legislation 17
(ii) Investment code 18
(iii) Mining code 19
(5) AGREEMENTS AND ARRANGEMENTS 20
(i) Multilateral agreements 21
(ii) Regional agreements 21
(iii) Other trade agreements or arrangements 23
(iv) Trade disputes and consultations 24(v) Investment agreements or arrangements 24
III. TRADE POLICY - ANALYSIS BY MEASURE 25
(1)
INTRODUCTION 25
(2) MEASURES DIRECTLY AFFECTING IMPORTS 26
(i) Registration and documents 26
(ii) Inspection, customs valuation and payment of duties and taxes 26
(iii) Customs clearance 28WT/TPR/S/54 Trade Policy Review
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(iv) Import duties 29
(v) Rules of origin 36
(vi) Anti-dumping, countervailing and safeguard measures 36
(vii) Prohibitions, quantitative restrictions and licensing 36
(viii) Standards and ecological and other technical  requirements 37
(ix) Government procurement 38(x) Local content requirements 40
(xi) Other measures 40
(3)
MEASURES DIRECTLY AFFECTING EXPORTS 40
(i) Regulations 40
(ii) Export duties and taxes 40(iii) Export licensing, prohibitions and other measures restricting exports 41
(iv) Export subsidies 41
(v) Duty and tax concessions 41
(vi) Export promotion, financing and assistance 42
(vii) Other provisions 42
(4)
OTHER MEASURES AFFECTING PRODUCTION AND TRADE 42
(i) State trading, State enterprises and privatization 42
(ii) Subsidies and other forms of production assistance 45
(iii) Price regulation and competition policy 45
(iv) Measures for the protection of intellectual property rights 46
IV. TRADE POLICY - ANALYSIS BY SECTOR 49
(1) INTRODUCTION 49
(2) AGRICULTURE , LIVESTOCK FARMING , FISHERIES , FORESTRY
AND RELATED BRANCHES 50
(i) General 50
(ii) Policy according to product category 51
(3) ENERGY AND MINING SECTORS 58
(i) Mining 58
(ii) Petroleum products and natural gas 59
(iii) Electricity 61
(4) MANUFACTURING SECTOR 62
(i) The agricultural processing industry 63
(ii) The construction materials and metal goods industries 64
(iii) The chemical industries 64
(iv) The textile and clothing industries 65
(v) The paper, publishing, wood and wood products industries 65
(5) SERVICES 65
(i) Transport services 67
(ii) Financial services 70
(iii) Tourism, hotel and restaurant services 74
(iv) Telecommunications and postal services 75
REFERENCES 77Guinea WT/TPR/S/54
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CHARTS
I. THE ECONOMIC ENVIRONMENT
I.1 Breakdown of real GDP by sector, 1992-96 2
I.2 Real gross domestic product of Guinea, 1989-96 6
I.3 Exports and imports by main groups of products, 1993 and 1996  9
I.4 Exports and imports by trading partner, 1993 and 1996 11
III. TRADE POLICY - ANALYSIS BY MEASUREIII.1 Average import duties (excluding community levy and additional tax) by sector 32
III.2 Average tariff according to degree of processing by sector (ISIC Revision 2), 1998 33
IV. TRADE POLICY – ANALYSIS BY SECTORIV.1 Rice imports, 1993-97 53
IV.2 Merchandise traffic through the Autonomous Port of Conakry (PAC), 1986-96 68
IV.3 Turnover on the insurance market, 1990-96 73WT/TPR/S/54 Trade Policy Review
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TABLES
I. THE ECONOMIC ENVIRONMENT
I.1 Basic social data, 1990 and 1995  1
I.2 Relative size of the mining sector contribution to the State levy, 1986-96  5
I.3 Basic economic indicators, 1990-97  6
I.4 Balance-of-payments, 1993-96  8
I.5 Investments, 1991-97 10
II. INVESTMENT CODE ADVANTAGES CONNECTED WITH
THE PREFERENTIAL REGIMES
II.1 Investment Code - advantages connected with the preferential regimes 19
II.2 Investment Code - tax and customs advantages 20
III. TRADE POLICY - ANALYSIS BY MEASUREIII.1 Customs tariff (excluding Community levy and Additional Tax)
by degree of finishing, 1998 25
III.2 Customs taxation of imports, 1990-98 29
III.3 Distribution of tariff headings according to the rates of consumption
surcharge, 1998 34
III.4 Exempted imports by major categories, 1996 36
III.5 Situation of public enterprises 44
III.6 Receipts resulting from privatizations, 1990-97 45
IV. TRADE POLICY - ANALYSIS BY SECTOR
IV.1 Cost of energy and telecommunications in 1995:
comparison with neighbouring countries 50
IV.2 Imports and average c.i.f. price of rice1993-97 53IV.3 Basic data on cotton, 1991-97 54
IV.4 Exports of mineral products, 1989-97 58
IV.5 Imports of petroleum products, 1990-95 60
IV.6 Structure of the prices of petroleum products, October 1996 61
IV.7 Electricity prices, March 1998 62IV.8 Schedule of Specific Commitments under the General Agreement on
Trade in Services (GATS) 66
IV.9 Commercial banks, situation as at end 1997 71
IV.10 Insurance companies, situation as at end-1996 72
IV.11 Indicators of telecommunication services, 1991-97 75Guinea WT/TPR/S/54
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APPENDIX TABLES
III. TRADE POLICY - ANALYSIS BY MEASURE
AIII.1 Import duties by chapter of the HS, 1998 81IV. TRADE POLICY - ANALYSIS BY SECTORAIV.1 Tariff according to degree of processing, 1998 84Guinea WT/TPR/S/54
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__________________________________________________________________________________SUMMARY OBSERVATIONS
(1) ECONOMIC ENVIRONMENT
1. Located on the west coast of Africa,
Guinea is a least-developed country (LDC),
independent since 28 September 1958.  Upon
achieving independence, Guinea opted for asocialist regime that allowed the State to
intervene in most economic activities.  This
State intervention discouraged private
initiative, and, with the starting up of mining
activities in 1975, encouraged the economy tobecome dependent on bauxite mining.  Guinea
left the franc zone in 1960 and created its own
Central Bank with a national currency, the
Guinean franc.
2. The economic growth sustained by
mining was slowed by the second oil shock in
1979-80 and the fall of bauxite prices.  In
response to the economic difficulties resulting
from this situation, the first reform measures
were taken by the Government at the
beginning of the 1980s.  The change in the
political regime in 1984 favoured a certainradicalization of reforms in the direction of
economic liberalization.  An Economic and
Financial Reform Programme (PREF) was
adopted in 1985 with the support of the
International Monetary Fund (IMF) and theWorld Bank, with a view to restoring
macroeconomic and financial balances,
reviving growth and improving the living
conditions of the Guinean population.
3. Social disturbances, increases in
salaries and family allowances, and decreases
in alumina prices sporadically frustrated the
implementation of re forms.  In 1996, in
response to the persisting macroeconomic
imbalances, a long-term development strategy(Guinea, Vision 2010) based on exploitation of
the country's potential by private operators
was adopted.  A second three-year Enhanced
Structural Adjustment Facility (ESAF) was
approved by the IMF for Guinea in
January 1997.4. With the exception of the 2.4 per cent
and 2.9 per cent growth rates recorded for
1991 and 1992 respectively, the various
reforms have led to an annual increase in real
GDP of at least 4 per cent since 1989.
Inflation has been contained and its level hasfallen from 19.4 per cent in 1990 to 1.9 per
cent in 1997.  The trade balance, which is in
perpetual deficit, is improving steadily;  it
could show a slight surplus in 1998 as a result
of increased bauxite exports.  However,compared with other external balances, the
results of the reforms remain modest.  The
deficit in Guinea's current balance, which can
be attributed to the services balance, including
interest on external debt, is the main reasonfor the unfavourable overall balance:
Guinea's net services imports have generally
exceeded net capital flows in its favour.
5. The Guinean economy remains
dependent on the exploitation of mineral
resources with which the Guinean subsoil
abounds.  Bauxite (the main mineralresource), gold and diamonds are currently
mined on an industrial scale.  These resources
undergo little local processing, but still
account for over 90 per cent of the goods
export revenue.  Their contribution to realGDP, however is falling.  Guinea also has
considerable potential for the development of
rural activities.  Manufacturing activity,
already poorly developed, has fallen following
the winding up or cessation of the activities ofcertain State enterprises, as current
constraints on the sector have failed to awaken
the enthusiasm of private investors.  The
services sector, dominated by informal trade,
is progressing, and accounts for more than50 per cent of real GDP.  Informal activities,
which are a feature of all sectors, reportedly
account for 60 per cent of GDP and supply
90 per cent of non-agricultural jobs outside
the civil service.  They range from retail trade
(50 per cent of informal jobs) to vehicle repair
(30 per cent of informal jobs), includingexchange activities.
6. In 1996, the European Union and the
United States absorbed more than 70 per centWT/TPR/S/54 Trade Policy Review
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__________________________________________________________________________________of Guinean exports.  Canada has also proved
an important outlet for Guinean products over
the past years.  On the other hand, for several
years Guinean exports to the Commonwealth
of Independent States have been on the
decrease, reflecting the end of the socialist erain Guinea, with the progressive maturing of
the last counter-trade contracts.  Alumina is
exported mainly to the United States and
Spain, and diamonds and gold to Europe.
Guinea's main suppliers are the EuropeanUnion (chiefly France), the United States,
Côte d'Ivoire and Japan.  China's share of the
Guinean market fell from over 10 per cent in
1993 to 2.4 per cent in 1996 owing to the
redirection of Guinea's trade towards non-socialist countries following the economic
opening up of the country.  The ECOWAS
countries supply around 20 per cent of
Guinean  imports.
(2) 
INSTITUTIONAL FRAMEWORK
7. Under the Constitution of December
1990, the Republic of Guinea is a pluralistdemocracy.  The President of the Republic is
the Head of State, elected by direct universal
suffrage for a term of five years, renewable
only once.  Executive power is vested in the
President, who lays down the main lines ofState policy and appoints the Prime Minister
and other members of the Government.  The
Government defines and implements national
policy.  The National Assembly exercises
legislative power, and votes the laws.  TheEconomic and Social Council must be
consulted on draft laws, plans and
programmes of an economic nature.
8. Since 1992, Guinea has been
implementing numerous reforms of aregulatory nature (publication of a code of
economic activities) and of an institutional
nature (reform of justice) aimed at ensuring a
business environment more favourable to the
development of economic and financial
activities.  The Investment Code, introduced in
1987 modified in 1995 and recently amended,aims at encouraging national and foreign
economic operators to invest in Guinea and tocontribute in this way to the achievement of
the Government's objectives, namely the
creation of a suitable environment for the
development of the private sector in all areas.
The Investment Code guarantees the same
rights and obligations to private and publicenterprises, whether national or foreign.  It
guarantees freedom to transfer capital, income
and salaries for foreign natural and legal
persons.  However, in order to qualify for the
benefits offered by the Code, enterprises mustbelong to the priority sectors of activity and
must be approved.  Among other things they
must give priority to Guinean citizens as
regards jobs, and maintain the quality and
level of their investments.  Like the InvestmentCode, the 1995 Mining Code provides that any
national or foreign, public or private natural
or legal person coming under Guinean law
and possessing the necessary technical and
financial capacity may exploit mineral
substances or quarries in Guinea.  However,
the semi-industrial and small-scale  mining ofprecious substances and the marketing of
diamonds and other gems is authorized only
for Guinean natural or legal persons.
Moreover, the exploitation of mines and
quarries qualifies for tax relief.
9. Guinea became a Member of the WTO
on 25 October 1995 after having applied the
GATT de facto from 24 June 1994.  Guinea
grants at least most-favoured-nation treatment
to all of its trading partners.  Like other WTOMembers, Guinea has adopted all the results
of the Uruguay Round and has accepted
commitments in the form of tariff bindings and
measures relating to the modes of supply of
certain services.  It has benefited from thetreatment granted to the LDCs, notably in the
form of exemptions or delayed implementation
of certain provisions, and it should benefit in
particular from the strengthening of rules and
disciplines in the multilateral trading system.
The concern in Guinea is to achieve
diversification (horizontal and vertical) ofproduction and exports, i.e. an increase in
supply which will enable it to make better use
of its potential and existing opportunities, as
well as those which should result fromGuinea WT/TPR/S/54
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__________________________________________________________________________________continued liberalization at the multilateral
level.  Guinea hopes that the technical
assistance provided for under the integrated
technical assistance programme launched by
the WTO and other organizations at the High-
Level Meeting held in Geneva in October 1997will help it to increase and diversify its
production and exports while improving their
quality, to make the WTO agreement more
generally known and to increase the number of
its trading partners.
10. Guinea is a member of the Economic
Community of West African States (ECOWAS)
for which the treaty was signed on
28 May 1975.  The 1993 amendment to the
Treaty provides, inter alia, for free trade inservices and the free movement of capital and
persons within the Community at the end of
the five-year period following the
establishment of the customs union scheduled
for the year 2000.  However, the timetable for
the implementation of this union is not being
respected.  Guinea has also been a member ofthe Mano River Union (MRU) since 1979.  The
Declaration of 3 October 1973 establishing
the MRU provided for the gradual
introduction of a customs union and the
promotion of community development projectsin all sectors, including services.  However,
the MRU is encountering a number of
difficulties in setting itself up, and trade
between the three countries is therefore
marginal.
11. As a signatory to the Fourth Lomé
Convention, Guinea receives aid from the
European Union.  A large number of Guinean
products receive non-reciprocal preferential
treatment upon entry to the EU.  Similarly,Guinean products are granted non-reciprocal
preferential access to the markets of
developing countries other than those of the
European Union in the framework of the
Generalized System of Preferences.  The scope
of these different non-reciprocal preferential
treatments is limited, particularly by the smallnumber of products exported by Guinea, i.e.
raw materials generally subject to zero or verylow MFN import duties in the importing
countries.
12. As of September 1998, Guinea had not
been involved in any dispute settlement
procedure within the GATT, the WTO or any
other trade agreement to which it is asignatory.
(3) 
TRADE POLICY FEATURES
(i) Trade policy instruments and their
impact
13. The reforms carried out by Guinea
since 1985 have enabled it to significantly
liberalize its economy and its trade.
Quantitative restrictions were abolished on
most products, with the exception of potatoes,
whose import is prohibited from February toJune each year in order to allow local
production to be sold.  Other restrictions are
also maintained for health, security or moral
reasons or under international conventions to
which Guinea is a signatory.  Moreover, under
the Programme for the Security of Customs
Revenue, the implementation of which wasentrusted in June 1996 to the Société générale
de surveillance (SGS), all imports whose f.o.b.
value is at least US$2,000 must be covered by
a descriptive import application (DDI);
preshipment inspection is required if the f.o.b.value is at least US$5,000.
14. The following duties and taxes are
levied on imports in Guinea:  an import
customs duty (DDE) of 2 per cent or 7 per
cent;  a fiscal import duty (DFE) of 6 per cent,8 per cent, 22 per cent or 23 per cent;  a
clearance fee (RTL) at a single rate of 2 per
cent;  a community levy (PC) of 0.5 per cent
on all imports from countries outside
ECOWAS;  and an "additional centime" (CA)of 25 per cent paid to the Chamber of
Commerce.  Import duties are ad valorem;
however, there is a minimum levy of GF 400
per litre for wines.  The simple arithmetic
mean of these import duties (excluding the PC
and CA) is 16.4 per cent, with a minimum rate
of 2 per cent and a maximum of 32 per cent.WT/TPR/S/54 Trade Policy Review
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__________________________________________________________________________________There is little variation among products (the
modal rate is 17 per cent) and the rates show
a generally negative escalation from
unprocessed products to finished goods:
subject to exemptions, unprocessed products
benefit from the strongest nominal tariffprotection, followed by semi-finished goods.
This should be reflected in nominal rates
higher than the effective production rates.
15. The most protected goods are
foodstuffs, and the least taxed goods arenon-electrical machinery and transport
equipment. Preshipment inspection fees, borne
directly by the importers, can add up to about
six additional percentage points to the tariff
protection level (in the absence of inspection).Special taxes (which cannot be cumulated with
other import duties and taxes) are levied on
imports under certain particular customs
regimes:  a registration tax (TE) of 0.5 per
cent is levied on imports carried out by
enterprises approved under the Investment
Code;  a storage tax (TEN) of 1 per cent islevied on goods placed in storage;  and a
transit duty (DT) of 3 per cent is levied on the
goods concerned.
16. A consumption surcharge has also
been levied on "luxury products" since 1986.On imports, the surcharge is ad valorem and
comprises eight rates, from 5 per cent to
70 per cent.  It is also levied on locally
manufactured products, such as beer and
cigarettes.  However, the method of taxinglocal products differs from that for imports of
identical products:  for example, beer
produced locally is subject to a surcharge
(specific) of GF 20 per bottle of 50 centilitres
or less, while imported beers are taxed at 70per cent.  This difference in taxation generally
observed provides additional protection for
local products.  The Special Tax on Petroleum
Products (TSPP) is a domestic tax levied on
imports of petroleum products in addition to
the DDE of 7 per cent , the DFE of 8 per cent
and the RTL of 2 per cent.  It amounts to GF355 per litre for petrol, GF 245 per litre for
diesel, GF 160 per litre for petroleum spirit
and GF 135 per litre for kerosene.  Since 1June 1996, a value added tax (VAT) of 18 per
cent has been levied on imports of local
products.  An additional flat-rate levy of 3 per
cent is applied to all imports carried out by
natural or legal persons not registered for
VAT.  The levy is charged against the tax onindustrial and commercial profits and
corporation tax on behalf of the National Tax
Directorate.
17. Under the Uruguay Round, Guinea
has bound its tariffs applicable to imports ofagricultural products (like the other Members
of the WTO).  For this purpose, it adopted
rates of:  40 per cent for the import customs
duty (DDE), 8 per cent for the fiscal import
duty (DFE) and 2 per cent for the clearancefee (RTL).  However, DFE rates of 22 per cent
and 23 per cent are applied to products such
as rice, flour and vegetable oil.  Apart from
Chapters 45 (cork and articles of cork),
47 (pulp and other cellulosic materials),
66 (umbrellas, walking sticks, etc.) and
86 (railway/tramway locomotives, rollingstock, etc.) of the Harmonized System, import
duties and taxes on other products have not
been bound.  The DDE rates have been bound
at 40, 20, 30 and 25 per cent respectively for
the products in these Chapters.  The DFE,TLR and TCA have been bound at rates of 8,
2, and 13 per cent respectively for those
products.  Thus, the bindings cover a limited
number of products and moreover, they leave
Guinea a certain latitude owing to the widegap between the bound duty rates and those
applied.  However, these bindings do not
concern products previously included in
Guinea's Schedule CXXXVI, i.e. those for
which the rates were bound when Guinea wasa colony.
18. For exports, a fiscal export duty
(DFS) of 2 per cent is levied on all products
with the exception of mineral products and
derivatives, and coffee.  The DFS is 3 per cent
for gold and diamonds produced on a small
scale (or 2 per cent if such gold is exported bythe Central Bank) and GF 25,000 per tonne of
scrap.  A tax of US$13 is levied per tonne of
coffee.  A 2 per cent tax is levied on allGuinea WT/TPR/S/54
Page xi
__________________________________________________________________________________re-exported products.  Taxes are also collected
by the Central Bank on exports of bauxite and
alumina and paid into a special account as an
advance payment on the various taxes payable
by the Guinea Bauxite Company (Compagnie
de Bauxite de Guinée - CBG) and FRIGUIA(which produces alumina).  These advance
payments are from US$8 to 9 per tonne of
bauxite (they vary according to the world
price for bauxite) and amount to US$1.75 per
tonne of alumina.  The tax (advance payment)on alumina is actually collected at a rate of
US$0.5 per tonne of bauxite consumed in
producing it.
19. Exports are subject to Descriptive
Export Applications (DDE), which replace theexport licences abolished in 1986.  The
formalities for obtaining a DDE take not more
than three working days.  Exports of gold and
diamonds produced on a small scale are
carried out by the BCRG.  For the purpose of
promoting exports, tax and customs
advantages are granted by the different codesin the form of suspension of duties and taxes;
temporary admission;  exemption from the tax
on industrial and commercial profits for five
years (in proportion to the export turnover);
and reimbursement of VAT credits on inputsand factors of production used to manufacture
the exported goods (for the purpose, exports
are zero-rated for VAT).  Moreover, in
addition to the privileges common to the
various regimes under the Investment Code,further advantages are granted to enterprises
(whether exporters or not) which make use of
Guinean products representing over 50 per
cent of their intermediate consumption during
the fiscal year.
20. Since 1986, price controls have been
progressively streamlined in Guinea.  In
practice, only petroleum products are
regulated.  These prices, set by an
interministerial technical council and kept
identical throughout the country thanks to an
equalization system, are approved for oneyear.  The scale of charges taken into account
in forecourt prices is revised monthly.
Moreover, thanks to the reform of Stateenterprises in the framework of the Structural
Adjustment Programme, it has been possible
to substantially reduce State involvement in
economic activities.  However, the
implementation of these reforms has been
slowed down over the past five years by thelack of purchasers for certain companies.
21. In Guinea, intellectual property rights
are protected by the Bangui Agreement on
Intellectual Property signed by some
15 African countries and establishing theAfrican Intellectual Property Organization
(AIPO), as well as a copyright law of
August 1980 and its implementing decree.
Work is under way in the AIPO to bring the
provisions of the Bangui Agreement intoconformity with the obligations of WTO
Members under the Agreement on Trade-
Related Aspects of Intellectual Property
Rights.  In Guinea, the Industrial Property
Service (SPI) is the national structure for
liaison with the AIPO.  In the field of
intellectual property, the most commoninfringement in Guinea is the counterfeiting of
trade marks.  Penalties have consisted in
seizure of the products concerned, the fate of
which is decided by the plaintiffs (right
holders).  The Guinea Copyright Office hashad problems enforcing these rights among
the main users of the works concerned.
(ii) Policies by sector
22. The economic reforms embarked upon
by Guinea under the structural adjustmentprogrammes in place since 1985 have affected
the different sectors of activity to varying
degrees.  In the agricultural sector, these
reforms have enabled the agricultural produce
marketing bodies to be abolished, most of theState enterprises operating in the sector to be
liquidated or privatized and the price controls
which applied to the main agricultural
products to be lifted.  However, the objectives
of the agricultural policy currently being
implemented, namely food self-sufficiency and
increased agricultural exports, have made itpossible to prohibit imports of potatoes from
February to June of each year and to applyWT/TPR/S/54 Trade Policy Review
Page xii
__________________________________________________________________________________flat-rate values to others (notably rice and
certain beverages).  The average import duty
on agricultural products (16.6 per cent) is
slightly above the average for all imports
(16.4 per cent).  Relief from duties and taxes is
also granted to inputs used in agriculturalproduction;  agricultural income is not
taxable.  The State has maintained its presence
in two branches:  cotton, which is still not very
developed, via a project structure supervised
by the Compagnie française pour ledéveloppement des textiles, and in the oil palm
and rubber tree branch, through a State
enterprise created in 1987.
23. Mining is the sector which benefits
from the highest nominal tariff protection.However, the liquidation and privatization of
State enterprises have reduced Government
intervention in the activities of this sector.  At
present, the Société des bauxites de Kindia is
the only State enterprise whose privatization is
not being considered.  The main objective of
mining policy is currently to promote exportsof Guinea's vast mineral resources, after they
have been processed locally.  With that in
mind, a system of taxation in stages (mining
tax of zero to 10 per cent) has been
introduced, with the highest rates beingapplied to exports of unprocessed mineral
products.  Furthermore, export duties of
2 or 3 per cent are levied on products such as
gold, diamonds and other gemstones;  these
duties amount to GNF 25,000/tonne on ferrousscrap and US$8 to 9/tonne on bauxite,
compared with US$1.75/tonne on alumina.
Tax and customs advantages are also provided
for under the Mining Code in favour of
investment in this sector.  Agreed rates(reduced rates) for the specific tax on
petroleum products are likewise applied.
24. The manufacturing sector remains
poorly developed, despite the Government's
disengagement from certain activities.  Private
sector reluctance to take over the privatized
industries can be explained by the problemsexperienced in the sector.  Indeed,
development is hampered by the high cost of
finance and inputs, the difficulties of obtainingaccess to credit, the lack of infrastructure, and
the power cuts as well as the structure of
import duties (negative escalation from
unprocessed products to finished goods).
These different factors push up the cost of
certain inputs and basic services, whichgenerally cost more in Guinea than in other
countries of the West African subregion,
thereby limiting the international
competiveness of Guinean manufactured
products.
25. Efforts have been made to liberalize
the services sector, largely dominated by
informal trade.  However, they have been
followed up by little in the way of
commitments at the multilateral level, whichmeans that the irreversibility of the reforms is
not guaranteed.  Guinea's bindings are limited
to measures concerning modes of supply of
certain services in the field of transport, hotel
services, veterinary medicine and social
services.  Moreover, the monopolies enjoyed
by certain private or mixed enterprises havebeen sanctioned in the supply of certain
services, either de facto (because of the small
size of the market) or as a transitional step
towards future full liberalization.  Thus, the
Société de télécommunications de Guinée(SOTELGUI), which is currently 60 per cent
owned by Telecom Malaysia Berhard and
40 per cent owned by the Guinean
Government, has a monopoly over the supply
of basic telecommunication services.  Theautonomous port and the airport of Conakry
are managed by public or semi-private
enterprises, where the Government is a
majority shareholder.
(4) 
TRADE POLICIES AND TRADING
PARTNERS
26. As can be seen from the growth rate of
the economy and the GDP per capita for
almost a decade, the reforms introduced with
a view to liberalizing the Guinean economy
have begun to bear fruit.  However, it will be
some time before Guinea will be able to fullyexploit its enormous potential.  This is due to
the lack of infrastructure, one of the mainGuinea WT/TPR/S/54
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__________________________________________________________________________________reasons for the relatively high cost of inputs
and basic services.  By pursuing its reforms,
including privatization, and by redirecting
public investment towards basic
infrastructure, Guinea should be able to
improve the international competitiveness ofits products by reducing production costs, and
to attract private capital.  By strengthening its
competition policy, Guinea would be able to
ensure that the reform of State enterprises did
not result in the transfer of monopoliesoriginally held by those enterprises to private
companies.  This threat, which is favoured,
inter alia, by the limited size of the market,
appears to be taking concrete form in certain
branches of activity.
27. Like the other developing countries,
Guinea would like the results of the Uruguay
Round to be more widely known.  According to
the authorities, this is particularly necessary
and urgent owing to the fact that, not having
directly participated in the negotiations,
certain aspects of these results and the scopeof certain commitments are not very well
understood.  This is true, for example, for
Guinea's commitments in the form of tariff
bindings.  Thus, Guinea would appreciate
technical assistance in this respect.