webGuinée / Etat & Société

La première décennie du régime PDG


Claude Rivière
Guinea: The Mobilization of a People

Ithaca. Cornell University Press. 1968. 260 p.


Chapter 6

National Resources and Individual Poverty

Benefiting by the enhanced prestige that resulted from the national unity created by the PDG, Guinea became the first country of Africa to adopt an economic policy of total decolonization, and to test the formula of state control over the commercial sector as a means of financing its first development plan. Within the framework of Sékou Touré's version of socialism, those steps met three fundamental needs: the acceleration of the formation of national capital, the stabilization of export revenues, and industrialization.
During the transition period from 1958 to 1961, when French interests in Guinea were radically affected, the aim was to reconcile the contradiction between an economic development based on the state's role and the socioeconomic habits inherited from the colonial structure. This coincided with the period in which politicians assumed control of the economy and small public works were undertaken amidst popular enthusiasm (called « human investment »). Subsequently, the arrival of foreign investors and the work they accomplished enabled the three-year plan to be carried out. In 1964, however, the difficulties encountered by all the state enterprises, the pessimistic reports submitted by experts, the waste of funds by a bureaucracy out of control, as well as negligence and theft, did not encourage the countries which had participated in those operations to persevere, unless they were committed by contracts made a few years earlier.
Consequently, the seven-year plan (1964-1971 ) could count on aid only from the United Nations, the United States, and the People's Republic of China. As mentioned in the preceding chapter, the U.S.S.R., for its part, had abandoned its project of building the Konkouré dam. Indeed, the lack of large-scale capital and of foresight had accentuated the trend toward economic drift. 1 That drift has been obvious in the partial paralysis of enterprises, the breakdown of the cooperative system, the stagnation of plantations and rice culture, and the embezzlement of public funds to the detriment of the accumulation of national capital and of productive activities.
We shall examine from different angles this economic drift under the seven-year plan, 2 as well as study the draft five-year plan and the investments in mining. Those investments launched a genuine economic recovery at the same time as they sacrificed some former socialistic goals.

Public Finances

The financial structure of the Guinean state comprises the Ministry of Finance, charged with executing the national budget, and a Ministry of Financial Control, created in March 1967 with a view to promoting economic recovery through strict supervision of the accounts of state enterprises, regional treasuries, and assets of individuals. 3 It also includes an Audit Office (Cour des Comptes), which audits the budget accounts (but without any real control over them), and a general treasury, which supervises the state's cash income and expenditures.

Table 3. Public finances of Guinea, 1964-1973 (in millions of Guinean francs)

Budget headings 1964-65 1965-66 1966-67 1967-68 1968-69 1969-70 1970-71 1971-72 1972-73
A. National budget
Total expenditure 22,570 25,080 29,640 32,100 23,476 25,880 22,856 27,830 45,000
Revenues
Tax receipts 15,340 15,860 15,930 16,600 17,276 17,580 17,356 18,430 18,500
Domestic loans 630 2,620 6,710 850 600 1,500 280 2,700 4,200
Foreign gifts 1,230 830 560 150 400 300 4,020 2,300 2,300
Foreign loans 5,370 5,770 6,440 6,650 5,200 6,500 1,200 4,400 20.000
B. Fiscal revenues 15,340 15,860 15,930 16,600 17,276 17,580 17,356 18,430 18,500
Direct taxes 2,640 3,150 3,350 3,500 3,260 3,490 3,520 3,610 3,700
Indirect taxes 6,460 6,700 6,700 6,700 6,800 6,990 7,170 7,260 7,530
Other fiscal taxes 1,480 1,410 1,070 1,230 1,410 1,640 1,270 1,480 1,520
Nonfiscal taxes 4,760 3,600 1,740 5,100 5,806 5,460 5,396 6.080 5,750
C. Operating budget 12,530 14,680 15,270 15,500 16,600 17,150 17,260 17,900 18,200
Defense 2,590 3,190 3,430 3,500 3,630 3,720 6,480 7,210 7,470
Agriculture 110 110 120 120 105 110 90 120 130
Education 3,280 3,740 3,580 3,580 4,320 4,570 2,080 2,210 2,300
Public health 1,420 1,660 1,280 1,650 1,735 1,680 1,490 1,670 1,820
Miscellaneous 5,130 5,980 6,860 6,380 6,810 7,070 7,120 6,690 6,480
D. Investment Budget 10,040 10,040 14,370 16,600 6,876 8,730 5,596 9,930 26,800
Agriculture 380 380 1,800 550 410 350 380 960 2,900
Education & Housing 310 310 2,620 780 270 720 540 630 3,500
Public Health 80 80 290 100 56 170 320 780 1,200
Transportation & Comm. 4,420 4,420 5,390 6,320 1,460 2,860 1,990 3,190 7,600
Industry & Energy 4,710 4,710 3,630 7,180 2,920 2,860 2,150 3,070 8,800
Miscellaneous 140 500 740 1,660 1,760 1,950 216 1,300 2,800

Note: Guinea's fiscal year runs from October 1 to September 30. Source: La Guinée libre, No. 9 (Feb. 14, 1974)

All these organizations have failed to prevent the mismanagement of public funds, colossal waste, and such disorder that Guinea changed its banknotes five times between 1960 and 1972. When, on October 2, 1972, the Guinean franc (FG) was replaced by the sily (worth 10 FG, and divided into 100 cowries), the amount of money in circulation totaled 38 billion FG, compared with 12,350 million at the time of the March 1963 reform.
A study of the national budget reveals some stagnation, not to say retrogression, in the economy, if the slight increase in the budget since 1964 is compared with the rate of world inflation. The spectacular increase in revenues for 1971-1972 was due simply to the 20 billion FG borrowed from external sources for mining investments. The table of public finances prompts the following brief comments:

  1. Under the heading of foreign donations the main entries are, first, the food surpluses given by the United States AID program, and second, the gifts in kind - rice, sugar, salt, and the like - furnished to the Guinean government by the People's Republic of China, which were sold to the population for the benefit of Guinea's treasury.
  2. The domestic loans take the form of official deductions from the funds of the state enterprises.
  3. The meagerness of fiscal revenues is indicative of Guinea's poverty.
  4. Direct taxation consists of the head tax, whose rate is comparatively low. Furthermore, the mass exodus to Senegal, Ivory Coast, and France of nearly one-fifth of the population explains the slight growth in revenues from that source.
  5. Indirect taxes consist almost exclusively of customs duties To offset the quantitative decline in exports and imports, customs duties have been increased, and their rates on certain items are exorbitant.
  6. Total operating expenditures remain fairly small. In this respect, it is noteworthy that the salaries of Guinea's civil servants are the lowest of any West African country.
  7. Whereas agriculture and the social services are neglected, the largest share of the budget is reserved for the forces repressing illegal activities, as can be seen from the amounts granted to the departments of defense and education. (The latter incorporates the people's militias and the youth movements - Jeunesse de la Révolution Démocratique Africaine (JRDA) and Pioneers)
  8. The investment budget shown in the table reflects, until 1971, the seven-year plan, more than 60 per cent of whose projects could not be realized because of lack of money. The official figures shown are forecasts, which were not necessarily fulfilled in practice.
  9. Operating expenditures are roughly equal to the country's real revenue that is to say, to its fiscal intake. One might therefore well ask what becomes of, and what is produced by, the foreign loans destined for development of the country. Elsewhere it can be seen that the foreign-trade balance is in deficit and that Guinea's foreign debt is large. As of June 1965, that debt totaled 204 million dollars; 4 in 1970, it was 328.7 million dollars; and in 1972, 410.8 million dollars. 5

Foreign Trade
Foreign-trade statistics for the years 1964-1972 (those for earlier years were published in a Bulletin Spécial de Statistiques) the only such report issued by Conakry) show a relatively stable volume. That stability is more apparent than real, for to compare the trade of those years would require taking into account several factors, such as currency devaluations and price increases. Although certain elements indispensable for such a comparison are unavailable, Julien Conde, an Organization for Economic Cooperation and Development (OECD) statistical expert, believes that in taking the year 1961 for the base index of 100, that of 1970 would fall between 40 and 50. 6 If world inflation is taken into consideration, it must be recognized that the volume of Guinea's trade is declining year by year and that the deficit in its trade balance is growing dangerously. This becomes even more apparent if the following adjustments are applied to the trade figures:

  1. The alumina exports of the international Fria Company (now called FRIGUIA) bring in to the Guinean government only what that government is entitled to as a shareholder. Moreover, the Fria Company imports petroleum products for its own use.
  2. The Compagnie de Financement du Commerce Extérieur (COFICOMEX), with headquarters in Geneva, has a twenty-five-year exclusive concession (which began in 1967) for the production and exportation of pineapples by its subsidiary, the Société Industrielle des Fruits Africains (SIFRA). This concession enables COFICOMEX to collect the debt owed it by the Guinean government. The company also imports fertilizer for its plantations.
  3. Not all the items imported under the development plan are incorporated in these statistics, but the exports which supply the funds to pay for those imports are included.

Heading the list of exports is alumina, whose production rose from 480,000 tons in 1964 to 700,000 in 1972. Between 1964 and 1972, the share of alumina in the country's exports grew from 46.8 per cent to 70.7 per cent. Pineapples hold second rank. It is curious, to say the least, that together those two products of capitalistic companies operating in a self-styled socialist state account for nearly 80 per cent of its exports, and they are the only ones to have made normal and steady progress. All Guinea's other exports have steadily declined. Iron ore, gold, and diamonds no longer appear among its listed exports.
The two biggest mining companies created under the colonial regime (the Bauxites de Kassa in 1952 and the Fer du Kaloum in 1953 ) have closed down. The former ceased operations in November 1966, following its nationalization in 1962 and the exhaustion of its deposits. The latter firm disappeared at the end of December 1966 for the following reasons:

Gold production in the Siguiri region during the colonial period, although not worthwhile on an industrial scale, was carried on by individual workers, with a record output of 4,750 kilograms in 1936 but only 187 kilograms by 1947. To prevent smuggling and speculation, a stop was put to production after 1950. Gold production fell victim to the gold exchange standard and above all to the discovery of diamonds, whose extraction was less onerous and better paid than gold panning. As a result, the latter became simply a secondary seasonal occupation for a few gold miners of the region until March 1, 1961, when it was formally forbidden throughout all of Guinea.
In the foreign-trade figures, it should be noted that diamonds no longer figure among the exports after 1965. The high-quality alluvion deposits in the southwest region of Kerouané were first mined in 1934 by Société Guinéenne d'Exploitation du Diamant (SOGUINEX), which was joined for this operation by the Société de Beyla in 1950. The combined output of the two companies came to 48,200 carats in 1960.
However, in November 1960, a decree forbade all individual diamond-mining operations. On March 1, 1961, the whole diamond industry was nationalized, and only the Entreprise Guinéenne d'Exploitation was authorized to continue diamond mining, with the aid of a team of Soviet specialists. In 1963, 52,280 carats were extracted, 7 and by the end of that year the diamond exchange, which held the monopoly of sales, was transferred from Kankan to Conakry. According to reporters of La Guinée libre, receipts for the deliveries made to the head of the Mines de Diamant de Kerouane (for example, the delivery of 52,000 carats in 1972) were regularly transferred to the office of the Presidency of the Republic « Diamonds mined in Guinean soil are the personal property of the head of state. The sale of diamonds brings in 3 billion CFA francs a year on the average. » 8

Guinea's foreign trade in 1964, 1968, 1972

In Table 4, under the heading of imports in 1972, it should be noted that if petroleum products are omitted, of which two-thirds are imported by the Fria Company as fuel for its thermoelectric plant, rice heads the list, whereas before independence Guinea exported rice. Machinery and metals represent a comparatively small part of total imports. The remaining items are consumer goods, of which some are acquired with funds allotted to economic projects under all the plans - a procedure detrimental to the nation's development. Moreover, when stocks run short, goods are imported in such a disorderly way that some articles are bought in large quantities or perishable goods go to waste because they have been poorly stored. For example, pens rust, food is spoiled, and cement is ruined by rainfall, as it was in 1965. Finally, there is speculation on the resale of such goods when they become scarce in the local market.

Trade with Guinea's major suppliers and customers (in millions of GF)

Table 5, which lists Guinea's major trading partners, shows that commerce with the Western nations has obviously declined to the benefit of countries of the Eastern bloc. Thanks to their clearing arrangements, and their long- and medium term loans, the latter countries have enabled Guinea to obtain manufactured goods in exchange for locally produced merchandise, and this phenomenon is more apparent in imports than in exports. The trade balance with the Eastern-bloc countries is in deficit, but it is favorable with those of the West (thanks to Fria's alumina and COFICOMEX's pineapples). Despite Sékou Touré's many pleas for African political and economic unity, Guinea's trade with other African countries remains almost nil. Trading with Cameroun is restricted to the Fria company, which ships some alumina to its plant at Edda, where, by means of the electricity generated by the dam there, it is transformed into aluminum.

Mineral Production
Despite the foregoing difficulties, it appears as of this writing that Guinea's economy has gotten its second wind after long years of paralysis. Business has won out over palaver. Fria's success has set the pace, but it has taken ten years or more for Guinea to realize how disastrous socialism has been for its economy, and how a cure of rejuvenation can be effected by « taking the waters » of capitalism.
The Boké project, taken over from the Bauxites du Midi by the Harvey Aluminum Company and by Aluminium Ltd. of Canada, represented one of the greatest hopes for Guinea's economy. From October 1, 1963, when the agreement was signed, it gave rise to malicious comments about the concessions made to American capitalism and Guinea's abandonment of its sovereign rights. Let us examine exactly what the agreement involved.
In the joint venture known as the Compagnie des Bauxites de Guinée,

Of their shares,

Guinea's Minister of Economic Development is chairman of its board of directors. The Societé de Transports Maritimes (SOTRAMAR), a joint venture for sea skipping created in December 1971 by the Guinean government and the Intermaritime Bank, is the carrier for Boké's bauxite output. Guinea is entitled to 65 per cent of the profits from the combined Boké-SOTRAMAR operations, and the Halco Corporation has committed itself to buy 6 millions tons of bauxite annually from Guinea over a twenty-year period.
Between 1969 and 1973, 339 million dollars was invested in this project, about half of which was earmarked for building the infrastructure. This consisted of the port of Kamsar on the estuary of Rio Nunez, a residential settlement at Sangarédi, and a 137-kilometer railroad which Guinea is to build. The guarantees of the United States AID and the World Bank for the investments date from June 1965. Yet it was not until October 3, 1969, that a token start was made on work for the Boke project, after prolonged negotiations and the grant of an initial 10-million dollar loan by the Société Financière Européenne. On August 2, 1973, the first shipment of Boke's output left the port of Kamsar. The 900,000 tons exported in 1973 earned 6.5 million dollars, 9 and it is hoped that production will attain 5 million tons a year beginning in 1975. Ismael Touré stated to an Algerian journalist in April 1974; « Annual exports will very soon reach the record figure of 10 million tons a year, and this will make Guinea the premier bauxite exporting country, as regards both the volume and the quality of its output. » 10 Assured of its future potential, Guinea has joined forces with the other bauxite-producing countries:

On July 15, 1974, Guinea convened the representatives of those states in Conakry to sign the final document of the international agreement on bauxite.
Before the Boke project got under way, Guinea continued to export the bauxite mined from the Los Islands - at Tamara (by Harvey Aluminum) and at Kassa (by a joint Guinean-Polish company) - as well as from Fria, where not all the bauxite mined is locally processed into alumina.
As of 1974, the Fria mines, situated 150 kilometers from Clonakry, still constituted Guinea's richest source of bauxite. They provided three-fourths of Guinea's foreign exchange and nearly half of its exports, especially those to countries where Fria's shareholders have their alumina plants: Norway, which took 22 per cent in 1966, and Cameroun. In 1970, a quota of about 10 per cent of Fria's production was allotted to Guinea for sale to its socialist clients in Europe - namely Poland, Czechoslovakia, and the Democratic Republic of Germany. As a result of the agreement of February 12, 1973, between the international company of Fria and the Guinean state, Fria's name and statutes have been changed. In the new joint venture, called the FRIGUIA company, Guinea has been assigned 49 per cent of its capital (in exchange for permits to develop new deposits) and 63 per cent of its profits. Among Guinea's partners,

Total production rose from 480,000 tons of alumina in 1964 to 700,000 tons in 1972, when a new policy was adopted. At that time, the two parties associated in the FRIGUIA company announced their common « conviction that Fria's new orientation conforms to Guinea's economic policy, and they pledge to do everything possible to attain quickly the assigned objectives, notably an annual production of one million tons of alumina. » 11 The policy of Africanizing the company's cadres has resulted in reducing the number of foreigners employed from three hundred to thirty. A similar employment policy is being actively pursued at Boke. Several other development projects are anticipated for the coming years. These also should make it possible to increase Guinea's revenues appreciably.
The decision to mine the deposits at Kindia was taken by Guinea and the U.S.S.R. in an agreement made in 1968. Subsequently, Guinea was granted a loan of 83 million rubles to finance the whole operation. This includes reconstructing the two ore-loading quays at Conakry port, including a 98-kilometer railroad to link Conakry with Debele (near Kindia), making improvements at the mine, and constructing a hostel for mineworkers. When full operation is reached, in about 1978, the annual production of the Office des Bauxites de Kindia (OBK) is to be 2.5 million tons of bauxite for shipment to the U.S.S.R. over a thirty-year period. Kindia's reserves are estimated at 42.8 million tons of bauxite, with a content of 48 per cent alumina and 1.7 per cent silica.
In still another development, the Alu-Suisse Company and the Yugoslav Energoprojekt Company agreed in April 1974 to accept the « suggestion of the Guinean government to merge the joint ventures, the SOMIGA and the Société des Bauxites de Dabola (SBD) to work the bauxite deposits of Tougué and Dabola in the context of a tripartite company in which the Guinean government is to participate. By common agreement, it has also been decided to create a consortium to build and operate an aluminum plant. Its initial capacity is to be one million tons, and the bauxite required will be supplied by the above-mentioned tripartite company. Engineering and other technical assistance is to be furnished by Alu-Suisse and the Société Anonyme pour le Développement de l'Industrie d'Aluminium de Tougue-Dabola (SADA). » 12
Guinea holds nearly two-thirds of the world's known reserves of bauxite, which amount to more than 8 billion tons. It aims to increase its production to 25 million tons a year by about 1980, when it plans to share in the enormous profits yielded mainly by the transformation of alumina into aluminum. To that end, negotiations were begun with Rumania in 1974 for construction in the Boké region of an aluminum plant with a 75,000-ton capacity. In August 1973, an agreement was reached with Zaire by which Guinean bauxite and alumina would be processed in plants built near the Inga dam in Zaire. Furthermore, it was decided at a meeting of the PDG on September 16, 1974, to build a dam at Koukoutamba in north central Guinea. After completion of that project about 1980, the dam should supply the electric current then needed to operate the bauxite mine and alumina plant of Tougue-Dabola. It should also provide energy for the cement factories of Siguiri and Mali, as well as the factory for the processing of aromatic plants, which Japan is modernizing. 13
Already well endowed by its bauxite-mining operations, Guinea plans to add iron to its productive resources. Estimates of the iron-ore reserves in the Nimba and Simandou mountains in southeastern Guinea range from 300 to 600 million tons, with an average iron content of more than 56 per cent. The joint venture MIFERGUI-Nimba, a mining company created at Tokyo on April 6, 1973, comprises

At a time when many countries are denouncing multinational companies, Sékou Touré prides himself on forming one as a means of developing his country and in the hope of eventually playing off the divergent interests against each other.
When MIFERGUI starts operations, scheduled for 1978, it will produce 10 to 15 million tons a year. For the transportation of Guinea's iron ore to the Liberian port of Buchanan, an agreement between Monrovia and Conakry was signed in 1973. However, Liberia's greediness in respect to royalties necessitated further negotiations in September 1974, between LAMCO and MIFERGUI-Nimba, to reach an agreement for the transportation of some 15 million tons a year. As for the remainder, the Transguinean railroad from Nzerekore to Conakry (1,200 kilometers), with a freight-carrying capacity of 50 million tons, should be able to transport the ore from the Nimba and Simandou mountains, as well as the bauxite of Dabola and Tougué and the agricultural and forest produce of the country. It is to be built under the direction of the Japanese company, Nipponkoei, and is expected to be completed in about 1982. That company is also involved in building a deep-water port at Conakry, able to handle ore-cargo ships of 100,000 to 300,000 tons. The railroad and port should enable Guinea to export annually mineral products worth 270 million dollars at present prices. 14
All these various projects require considerable amounts of energy. Although Guinea possesses a great hydroelectric potential, it now has only two comparatively low-powered generating plants: the Granda Chutes, 4 kilometers from Kindia, and the Kinkon dam in the region of Pita, which supplies electricity solely for domestic usage and craft enterprises. The thermal generator at Conakry, a gift from AID, supplies energy only to the capital city, and Fria consumes all of the 91,500 kilowatts of power produced by its thermal plant to transform bauxite into alumina by electrolysis. Dam construction has been among the projects included in the several three-, seven-, and five-year plans, but there has been no follow-through for lack of foreign investors interested in undertaking expensive enterprises from which they cannot repatriate profits. Thermal generating plants cannot solve the problem at a time when the price of petroleum is soaring. Between the crisis of 1973 and July 1974, for example, the cost of gasoline (which comes in niggardly amounts almost exclusively from the U.S.S.R.) rose 307 per cent, fuel oil 157 per cent, and petroleum 118 per cent. 15 Until the SOGUIP, a joint venture in partnership with the American company Buttes Resources International, strikes oil, the Guinean government (which nationalized gasoline filling stations in 1969) can count only on the eventual construction, with Algerian assistance, of an oil refinery at Conakry with a production capacity of about a million tons.

State Enterprises
Compared with the huge revenues that Guinea expects to receive in the 1980s, those now provided by the national enterprises appear ludicrously small. In 1968, they contributed no more than 2.6 per cent to the gross national product. Serious problems exist in obtaining raw-material supplies, in the repair of machinery, in the availability of technical skills, and in transportation and markets, as well as in respect to production costs and waste. To illustrate the foregoing statements, it will suffice to cite some significant examples without listing and analyzing all of Guinea's producing enterprises.
At the Mamou cannery, the high cost and uneven quality of its output and the lack of reliable markets are not enough to account for the fact that it has never operated at more than 20 per cent of capacity. Built during the three-year plan with aid from the U.S.S.R., it began functioning in 1963. Three years later, it was supplied by the peasants with only 308 tons of tomatoes instead of the 2,000 tons it was equipped to process. The peasants are paid 25 FG per kilogram by the cannery, but with a monthly income well below 10,000 FG they cannot afford to pay 350 FG for a 500-gram can. Similarly, the state meat-preserving and sales firm, OBETAIL, and the Conakry abattoir (built by the German Federal Republic in 1962) pay 15,000 FG for a bullock, whereas private butchers offer 40,000 FG. Furthermore, canned meat of any kind is regarded with suspicion by the predominantly Muslim population. It can therefore be readily understood how little the rural population has been inclined to participate whole-heartedly in this national enterprise, which has been able to function at all only thanks to the army's tomato plantations, the « production brigades, » and the regional market gardens of the Colleges d'Enseignement Rural (CER).
The Sanoya textile complex, built with British aid and by Lebanese subcontractors and equipped with 20,000 spindles and 780 looms, has never functioned at more than a third of its capacity since 1966. Because of the great care it requires, cotton culture is not considered a paying proposition by the peasants. After Guinea's sobering experience with the cotton campaign of 1966, cotton had to be bought from Egypt and consequently stocks ran short. Furthermore, considering that the average age of its 1,045 workers in 1967 was between seventeen and eighteen years, and that its personnel was relatively unstable and unreliable, it is no wonder that the work done there was shoddy and that the equipment rapidly deteriorated.
At Wassa-Wassa, 24 kilometers from Conakry, the state tobacco and match factory built by the People's Republic of China in 1963-1964 is the only public enterprise on a national scale that might be termed a success, both technically and because of its large domestic market. Its construction cost 5 million dollars (or less than half the funds invested in the textile complex), and it can produce 24 million packs of cigarettes and 45 million boxes of matches a year. However, the tobacco supplied by the farmers of Beyla has never amounted to more than a scant third of the 500 to 1,000 tons required each year, so additional supplies have had to be imported from China and Malawi (and even from Rhodesia). The plantations of gmelina wood, cultivated for use in making matches, have been unable to supply more than half the amount needed, and some have been severely damaged by brush fires. The factory's successive managers (a government clerk, a school monitor, and a magistrate) were scarcely prepared by their former occupations to take charge of such a factory. Finally, it should be noted that the heaviest demand for cigarettes comes from the forest peoples who live near the frontier and who use the Guinean products as a medium of exchange for trading across the boundary.
In 1967, a sawmill and plywood factory built in the Nzerekore region with Soviet aid and inaugurated in 1964 turned out only 16,000 of the 50,000 cubic meters it had the capacity to produce. Machinery not built for tropical use often broke down, and sometimes there were fuel shortages. Inevitably, forest regeneration is a slow process. As the output must be transported over 1,200 kilometers of rough trails to the Sonfonia furniture factory (built by the Yugoslavs near Conakry), it is very difficult to supply that factory. The sawmill's wood debris was supposed to go to a plant which had been constructed between 1965 and 1967, at Seredou in the Macenta region, for the manufacture of panel boards of compressed sawdust. Some of the cinchona wood from Seredou was to be shipped to Nzerekore for processing and then returned to Seredou. But the only connecting link between those two places is a very difficult mountain trail some 100 kilometers long. Furthermore, certain difficulties regarding policy and management arose with the Belgian construction firm, Omnium Chimique, that first delayed and then seriously hampered its operation.
The Kassa oil mill, completed by an Italian firm in 1968, was designed to process, alternately, peanuts, palm kernels, and copra. Soon the peasants of lower Guinea realized that the prices paid for their palm kernels and coconuts were too low. Then, because the mill had been built on an island, the cost of bringing raw materials there was high, given the small size of the boats carrying them. Finally, Senegal, the source of the mill's peanut supplies, stopped shipping them, not only because Guinea was insolvent but also because its leader used any pretext at hand to insult his neighbor at Dakar. The factory is therefore even more inactive than the peanut mill built at Dabola by the People's Republic of China.
The same inactivity - along with damage to equipment by weather - characterizes the fruitjuice plant at Kankan and the tea factory at Macenta. In 1974, the quinine factory at Seredou was paralyzed because the agricultural monitor who managed it had not renewed the cinchona plantations at the proper time.
At Dubreka, Conakry, and Foulaya there are junk yards of machinery, whole factories, and equipment that have never been installed. Here one finds the makings of a soft-drink plant and of a dairy, and there the machines for a palm-oil mill given by AID. To supply the sugar mill at Koba, which began operating in November 1973, 211 hectares of cane are being cultivated instead of the 2,000 hectares worth the mill is equipped to process. To be sure, that mill's requirements in fuel come to 350,000 liters of gasoline and 545,000 of oil . . . and it does not earn the foreign exchange needed to buy them. Nevertheless, Guinea must reimburse the countries that loaned it the funds to set up these insufficiently productive installations.

The Economic Strangulation of the Private Sector
Since independence, the steadily dwindling private sector has survived only in the hope of a change in the regime. It could hardly be satisfied with an economic setup that brought it more losses than profits (except in mining enterprises).
Had Guinea moved directly to eliminate private companies by nationalizing them, the nation would have had to pay damage claims and would have been weighed down by lawsuits. Furthermore, Guinea after independence had neither the native entrepreneurs nor the technical cadres able to render the same services as the Europeans. Consequently, by pursuing an economic and monetary policy that gave it control over the capital of the private companies, the state retained the option of getting rid of those companies, if need be, at a time of its own choosing. To this writer, it seems that the economic strangulation of the private companies was deliberately planned by the Guinean state, which wanted to manage its own economy, and that, at the same time, it stemmed indirectly from the economy's widespread difficulties, inasmuch as in the long run even the national enterprises were adversely affected.
Several factors successively played a part in the process of eliminating the private companies. Profit margins were reduced by a two-stage control.

The state, lacking hard currency especially after 1964, reduced to a minimum the number of import licenses issued. Consequently, the enterprises had to cut back on production and sometimes even suspend it altogether. Thus the Société des Brasseries de Guinée had to stop delivering beer several times a year because administrative red tape had delayed the delivery of bottle caps, hops, and spare parts for its machinery, or because the state financial services had rcduced the quantity of imports requested by that company. Delays in getting supplies, reductions in their quantity, and the state's refusal to grant more licenses could not fail to diminish seriously the earnings of all the enterprises.
Compounding these difficulties was the shrinkage in the private companies' European staff following two further developments:

With the departure of most of the European cadres of an enterprise, its productivity declined, its poorly guarded equipment and tools disappeared, and its managers became the target for accusations by their politically zealous accountants. As a result, the enterprise might decide to close down its money-losing Guinean branch. Then the next step often was the taking over of the factory by the Guinean government, which carried it on with its former workers, under the management either of other foreigners working under the state's control or of Guinean technicians. There ensued a progressive deterioration caused by negligence, theft, and waste.
Fully aware of this chain of events, the private companies decided to make their enterprises yield profits as long as possible by offering their employees monetary inducements to work and, at the same time, by side-stepping any control whatsoever on the part of their subordinate Guinean cadres or laborers. In this way, the private sector's employment policy and its wage strategy grew out of the working conditions imposed upon it. As a matter of fact, the private sector was overpaying its workers so as to retain their services and, at the same time, to avoid certain pitfalls, such as changing job classifications or even promoting Guineans to the rank of foreman.
One manager told the writer,

« Promotion to a higher job category means that a Guinean would become more demanding and work less.... [If he were made a foreman,] he would want simply to give orders and no longer work. . . ! They haven't the training needed . . . and they would interfere in their boss's affairs, accounts, and decisions. »

Except for the Fria Company, which has its own training school, none of the private enterprises has tried to train its apprentices. Their workers learn on the job, merely receiving from their overworked European overseers instructions on how to carry out a given piece of work. Under the present program, an apprentice must attend night school, taking courses both in his own specialty and in political ideology. At the end of two years of such instruction, he automatically receives a « certificate of professional aptitude, » regardless of his actual qualifications. The company is then obliged to keep him on, give him the job classification as determined by the Ministry of Labor, and assign him a foreman's position after two or three more years. Such a procedure leads to the dismissal of a European and an increase in the cost of services because an African foreman does not work productively himself (he confines his activity to supervising operations). Furthermore, it introduces a disturbing element into the enterprise's business should the anti-imperialist ideology of the Guinean foreman impel him to scrutinize his European superior's words and actions and possibly denounce him.
To sum up the situation: The private sector, which accounted for virtually every industry in 1958, represented only 57 per cent of the total by June 1966. Wage earners in private industry had become fewer than those in the public sector. Excluding the large group of 1,379 workers employed by the Fria Company, only 1,719 were employed in small private industries, whereas there were 4,069 in the public sector.
Several private enterprises went out of business in 1971, either because their European manager had been imprisoned at the time of the November 22, 1970, invasion or because they were unable to obtain supplies. Among those companies were

No foreign private enterprise was founded during the three-year plan. This is the more significant in that in 1962 a new investment code was promulgated which, inter alia,

Only the Harvey Aluminum Company in 1967 - that is, during the seven-year plan took the risk of mining Tamara's bauxite under economically mediocre conditions, in the hope of sharing in the future development of the Boke deposits.
From a global socio-economic viewpoint, Guinea offers private capital no guarantee that it can enjoy full scope, and, moreover, discourages the potential investor in other respects. These include Guinea's

Even for the private sector, the state restricts and controls production, sets prices, imposes its distribution network, and regulates the labor market. Lacking the power to negotiate with the state, a foreign enterprise can survive only if its manager or director cultivates personal relations with some minister or high-ranking civil servant. Even then, such protection is jeopardized if the official is dismissed from his post. Excepting the Swiss company COFICOMEX, which has ties with the most stable ministers (among them Ismael Touré) by means of bribes and commissions paid into their Swiss bank accounts, foreign businessmen have no real economic power. Constant intervention by the public authorities, the always latent threat of nationalization, and the extreme difficulty of repatriating profits - all these add up to genuine economic strangulation (except for enterprises like those of public works, which are agencies of the state). FRUITAGUINEE, the only private Guinean firm employing more than ten persons, closed down in 1971 after its director was put in jail.

Agricultural Production
Whereas the food industries, like those of manufacturing and equipment, either stagnate or retrogress, agriculture is sinking back to the subsistence level. This has taken place despite the emphasis placed at four 1964 conferences upon developing complementary regional economies. The major regions' specializations, as determined by climate and soil, are as follows:

According to a government estimate in 19$59, 90 per cent of the active population (almost entirely peasants) furnished only 56 per cent of the total national revenues, as contrasted with 44 per cent produced by the 10 per cent of the population then working in other sectors. At that time, agricultural productivity was seven times less than that of the other sectors.
Despite persistent official efforts to change attitudes in the rural world, it has remained strongly traditionalist, and rudimentary means of production continue to be used. Moreover, the peasants' meager cash income and lack of technical knowledge are barriers to modernizing their equipment. Other factors that contribute to maintaining the status quo are the retarded growth of the transportation infrastructure, a declining commercial sector (where the colonial trading system still largely prevails), the fall in world prices for tropical produce, and the quantitative and qualitative inadequacy of wage earners and of their supervisors.
Guinea's agriculture is unsatisfactory on three counts:

A reporter for Horoya hebdo pointed out very clearly some of the technical faults from which his country's agriculture is suffering. The thrust of his articles may be briefly summarized as follows:

Other harmful factors are

Much of the machinery imported to help the peasantry is owned by urban merchants, by political leaders and administrators, or by rich peasants, who either rent it out at high rates to the PRL or CER or transform the tractors into rural taxis by putting platforms on them.

The large-scale importation of farm machinery has only a small impact upon the national production of salable commodities. … In 1969, family cooperatives replaced other cooperatives that had proved unworkable. These are family consortiums made up of wealthy persons who band together to buy a tractor, or they are special-interest associations artificially organized for the purpose of obtaining grants of matériel and seed. . . Expansion of the PRL has been hampered in many [party] federations by a restrictive interpretation of the brigade principle. This had led to assigning projects on a permanent basis to a small group of individuals who, in the long run, feel that they are being exploited. 16

In 1973, the PRL strove to correct that formula by organizing work brigades of fifteen peasant volunteers. They were issued plows, draft animals, cloth, food, and seeds as short-term loans, for which repayment fell due after the harvest. By this means, members of a brigade were to become owners of the means of production. Their leaders, however, are afraid that a conflict of interests may develop inside the PRL; the alternative base for rural development is the « socialist cooperative societies which should emerge from our schools located in rural centers. Indeed, after a course lasting twelve to thirteen years, most students at our Centers for Rural Education should form socialist cooperatives. » 17 The addition in 1973 of a thirteenth year of study in 200 schools should make available 6,000 to 7,000 more young graduates for setting up cooperatives. The People's Republic of China has been asked to send 150 experts to guide those graduates in their early stages.
What results should be expected when, for the nth time in Guinea's more than fifteen years of independence, the head of state, in July 1974, felt impelled to advocate once again a « true agricultural revolution » based on production brigades and on increasing output and productivity? He also sounded this warning: 18 Guinea, which had spent about 3 billion FG between 1970 and 1972 for the 60,000 tons of imports it needed to cover its food shortages, had to spend 7 billion FG more in the 1973-1974 fiical year, because of soaring prices and the shortfall in crops in an exceptionally dry year. The holder of a food card was entitled to a maximum of 8 kilograms of rice per month, but in April 1974 that ration was cut to 3 kilograms. Periodically, oil, soap, sugar, milk, salt, and tomato concentrate disappear temporarily from the market. In September 1970, the shortage of rice, 19 Guinea's staple food, was already so serious that the government had to send out a real S.O.S. Thanks to help from Senegal, Egypt, and United States AID, Guinea was able in one way or another to bridge the difficult period until the next harvest.
Nevertheless, many rice-growing projects had been undertaken on the basis of the local improvements that had been planned and started by the French before independence. In the Fié valley, near the Niger in upper Guinea, the Soviets invested, under the three-year plan, 3 billion FG in matériel and hydraulic construction before they abandoned the project »for financial and perhaps political reasons. » 20 Programs sponsored by the UN and AID in Kaback and Koba ended abruptly as a result of the deterioration of Guinean-American relations in 1967. Later, a mission from the modestly endowed UN Special Fund tried without visible success to revive farming on the arable areas of those same regions and also in the Kapatchez, where they encountered tremendous technical difficulties and a shortage of experienced laborers. The Vietnamese and the Chinese, especially after 1968, worked with the very limited means at their disposal to improve here and there the fields cultivated by the CER.
As for the goals set for industrial crops, most of the manufacturing enterprises which they were to supply operated at a slow pace or only periodically for lack of raw materials to process, as has already been explained. The new five-year plan, launched in September 1973, offers little hope for improvement, inasmuch as agriculture has been allotted only 9 per cent of the total estimated expenditures, compared with 10.8 per cent and 12.9 per cent in the preceding plans. Under such conditions it would be surprising if the agricultural situation were saved by the « production brigades » or even by the « socialist cooperatives » which the tenth PDG congress, held in Conakry in September 1973, decided to create.
The remembrance of many past failures weighs too heavily. Coercion and the grip of the administration explain why the decline of the colonial power brought down with it the Sociétes Indigènes de Prévoyance (SIP). The disappearance of the Sociétés Mutuelles de Développement Rural (SMDR) was due to the embezzlement of their funds. Even the government recognized the faults in the management of the Coopératives Agricoles de Production (CAP), created after independence, and in the Coopératives de Production Agricole et de Consommation (COPAC), which reactivated the moribund CAP by replacing them. Most of the time, their executive committees were held in check by a chairman who, in making the decisions himself, violated the principle of collective responsibility. (This was notably the case of the Bangtama cooperative, which was chaired in 1967 by the secretary of the local PDG section, and also that of the Gbaia cooperative in 1968, when it was headed by a former regional governor.) 21 Many cooperative groups continued to be formed for the sole purpose of getting loans, of which 80 per cent had not been repaid by the end of the three-year plan. The dissolution of a cooperative did not bring about the restitution of funds that had been wasted or misappropriated by those responsible for its management.
On the whole, it might be argued that the mechanization introduced by the pilot centers was simply a simulated modernization, and that the individuals holding political and economic power found in the cooperative society a very malleable agrarian structure.
If rice cultivation was the chief food-crop production to be hindered by the successive reorganizations of the cooperatives and by modernization, it was not the only one to suffer a setback. The cultivation of manioc, millet and sorghum, corn, and sweet potatoes followed a similar course.
This distinct decline in food-crop production can be explained in large part by the massive exodus of peasants to foreign countries (notably Senegal and Ivory Coast) and of young people holding some kind of school diploma to the capital, and by the permanent mobilization of the peasants for unproductive tasks, such as political meetings, receiving traveling officials, and recruiting young persons into the militias. It was further aggravated by the population's indifference to increasing cultivation, because the people were aware of the draining off of rural assets by urban centers and the failure of local tradesmen to offer wanted goods in exchange for the sale of surpluses. Still another factor in food-crop shortages is the lack of a nourishing diet, which adds to the vicious circle of underdevelopment. The peasant exodus explains also the decrease in the livestock population, which declined from one cow to two inhabitants in 1964 to one to three in 1974. Whereas Guinea's population is growing at an annual rate of 2.7 per cent, the over-all production of paddy declined from 360,000 tons in 1964 to 200,000 in 1972. 22
Export crops suffer from the same regressive tendency.

Among the agricultural exports,

In the meantime, to be sure, Fria's alumina plant had entered into production, providing the Guinean state with 70 per cent of its foreign exchange. Clearing agreements had been made with the U S.S.R., but these were not particularly helpful to foreign planters, who accounted for 70 per cent in value of the banana exports, grown on 51 per cent of the areas devoted to that crop. Only from time to time did the government fulfill its promise to planters in 1973 to recompense them for bananas and pineapples exported to the extent of 3 FG and 5 FG in currency per kilogram, respectively. One must also take into account the damage to coffee and bananas by plant diseases and nematodes, as well as the high cost of combating them.
The discouraged native planter who lets such plant diseases ravage his 2 or 3 hectares of fields indirectly facilitates their spread to neighboring areas. Even worse, about one-fifth of the French plantations that were abandoned during the three years following independence came into the possession of politicians, who were content simply to profit from their production without making any outlays for their upkeep or expansion.
The total production of bananas - for local consumption as well as export - declined steadily from 1955 to 1971, which was the year of the Fifth Column trials. The volume increased slightly to about 30,000 tons in both 1972 and 1973. The most prosperous planters either turned to growing pineapples, which were more remunerative, or to trucking, while the small-scale planters reverted to food crops.
The land best suited to banana culture is in lower Guinea, which has favorable climatic conditions:

Most of the coffee is grown in the forest zone. Plantations of this semi-wild crop are family-owned and require only small investment. Nevertheless, by 1964, a virulent plant disease had destroyed half the plants that had existed in 1958, and the proximity of the plantations to Guinea's frontiers facilitated illegal sales in Sierra Leone and Liberia. The result was that exports shrank

For recent years, only figures of total production are available.

Of all Guinea's industrial crops, only pineapples have followed an upward curve. After a fast take-off (2,900 tons in 1958 and 7,800 in 1960), they fell back (to 3,600 tons in 1961 and 1,600 in 1962) before progress was resumed (8,000 tons in 1966 and 11,000 in 1968). For the following years, one must subtract from the figures for total production - the only data available - 4,000 to 5,000 tons of pineapplcs that were consumed locally as fresh fruit, juice, or preserves. Over-all production was reported as

Other agricultural exports - such as palm kernels (20,000 to 25,000 tons), citrus (about 4,000 tons of orange essence) and some mangoes and avocados - have stagnated for the past ten years. Almost all of the 25,000 tons of peanuts that Guinea produces are consumed by its increasing population.
From the foregoing information, it is easy to see whether the goals of the seven-year plan were attained. Without giving precise figures, that plan aimed to consolidate Guinea's economic independence between 1964 and 1972 in three respects:

To the surprise of no one, no accounting of that plan has been published. Moreover, it is certain that the three-year plan was far more successful than the 19641971 plan.

The Five-Year Plan
A five-year development plan for the 1973-1978 period was whipped into shape and launched at the tenth PDG congress on September 28-29, 1973. It comprised the following three sections:

  1. A plan for each PRL (of which there were 7,790 at that time in Guinea) based on its known or estimated resources in manpower, materiel, and funds. The execution of this plan depended essentially on the group's own efforts and especially on its capacity for work.
  2. The point of departure for the regional development plan was the region's development budget, which determined the objectives assigned to the community involved (such as collective fields and plantations and the building of roads, schools, bridges, and the like). « Before the five-year plan is completed, each region should be able to feed itself properly without requiring supplementary external aid. » 26 No figures are specified in this part of the plan, and there is little doubt that the drafting of this and the preceding section caused difficulties.
  3. The national plan was drawn up jointly by several ministries, including that of the plan, and also by the planning commission of the Central Committee of the Party. It anticipated investments amounting to 58,680 million sylis (or 586,800 million CFA francs) by 1978. In the portion dealing with rural development, priorities were given to

In other words, the priorities assigned were the same as those of previous plans. Most of the industrial investments were earmarked for a sawmill, an oil refinery, cement plants, a paper mill, a tin plate factory, and a saltworks. For the sector of rnining development, the « socialist » regime of Sékou Touré relies almost wholly upon investments by private capitalists in the so-called imperialist countries. Investments in that sector totaled 34,330 million sylis, constituting 58.5 per cent of the plan budget, not including the 12.8 per cent allotted to energy. To anyone familiar with the dilapidated state of Guinea's houses and highways, it is astonishing that only 10.8 per cent was allocated to public works, urbanization, housing, and roads. It simply comes down to a question of choice. It is hard to see how the public-health service could modernize its equipment, as it is expected to do, with only 752 million silys, or 1.3 per cent of the budget. One must wait and see. Nor is the banking and trading sector of the economy (allotted 1.2 per cent of the budget) likely to become self-supporting when it has been chronically in deficit. The head of state himself has attributed that deficit to embezzlement. Perhaps the answer lies simply in turning out more banknotes.
In the light of these data, what judgment can be reached as to Guinea's economy? Doubtless a fairly pessimistic one, if consideration is given to

It is necessary to take into account also the inadequacy of the infrastructure for generating energy and for roads and towns - all indispensable for an economic take-off - and the relapse of agriculture to the subsistence level. For the very long run, however, one might hazard a more optimistic appraisal, considering the many varieties of Guinea's climate and soil favorable to agriculture, and especially its huge mineral resources now in process of development. In a medium-term perspective, the comparative wealth of the debt-burdened state will continue to coexist with the poverty of its individual inhabitants.
Viewing Guinea's comparative failure over a period of more than fifteen years from a certain angle, it appears to have been caused by an unduly hasty identification of political awareness with social capital. Guinea has been suffering from an illusion as to its wealth even more than from the delay in developing its productive strength (which is characteristic of underdevelopment everywhere). A political structure is not in itself a valuable asset, and it can become one only to the extent that it effectively changes human beings and exploits existing resources. Those resources can become a source of wealth only to the degree that the state can dispose of the human, technical, and financial capital needed to turn its economic potential to its own advantage.
Fortunate in the aid it receives from all quarters, Guinea has been richer in material assets than in entrepreneurs, and better endowed with resources than with incentives. It is regrettable that the Guineans' extraordinary capacity for mobilizing their potential should have been used mainly for tilting at windmills. But a technical civilization cannot be generated spontaneously. The gestation period for a politician is shorter than that for an entrepreneur, and bureaucracies proliferate faster than technicians. Moreover, it is those bureaucrats and politicians who are trying to monopolize the national revenues, while sometimes ignoring the basic principles, who determine the functioning of the economy.
For the time being, every Guinean, living in the shadows of underdevelopment, is experiencing an alarming rise in living costs, shortages of imported consumer goods, a depletion of the nation's foreign-exchange assets, and a decline in job opportunities. Yet at least the light that he sees on the horizon now comes from the glow of aluminum rather than from the glittering mirage of revolutionary oratory.


Notes
1. Because enterprises have been installed where they would be most effective politically, their economic viability has often been undermined by the failure to take into account the dimensions of the market, transport costs, or the availability of sufficient amounts of raw materials.
2. The author has in his possession unpublished statistics for the 1964-1972 period, which came from a confidential source in the office of the Presidency of the Republic of Guinea. Their accuracy has been confirmed by the documented information infrequently printed in Horoya, broadcast over the radio, or published in the Revue RDA.
3. This caused highly placed but insecure civil servants to denounce the minister, Ousmane Baldé, as a mercenary. In consequence, he was hanged in 1971.
4. An OECD document. Details about this debt on a country-by-country basis were published in Guinée: Perspectives nouvelles, No. 30 (Aug. 1973), p. 13.
5. La Guinée libre, No. 10 (Feb. 21, 1974).
6. Ibid., No. 10 (Feb. 21, 1974).
7. Confidential report submitted to the Guinean government by a team of Soviet geologists.
8. La Guinée libre, No. 12 (Mar. 7, 1974).
9. West Africa, May 6, 1974.
10. Interview given by IsmaeI Touré to a journalist of Révolution africaine, Algiers, Apr. 19-25, 1974, p. 31.
11. Le moniteur africain, Aug. 30, 1973.
12. Révolution africaine, loc. cit., p. 30.
13. Marchés tropicaux et méditerranéens, Sept. 27, 1974.
14. La Guinée libre No. 12 (Mar. 7, 1974); and Marchéd tropicaux et méditerranéens, Sept. 13, 1974.
15. Marchés tropicaux et méditerranéens, July l9, 1974.
16. Horoya hebdo, Mar' 7-13, 1970.
17. Horoya, June 14, 1973.
18. Marchés tropicaux et méditerranéens, July 19, 1974.
19. Increasingly, the population prefers rice to fonio (a not very nutritious cereal), manioc, and yams. Guineans eat little corn.
20. Jean Suret-Canale, La République de Guinée (Paris: Editions Sociales, 1970), p. 240.
21. Tierno Nabika Diallo, « Bilan et perspectives de la coopération dans le développement de l'agriculture guinéenne » (mimeographed; Conakry: Institut Polytechnique, 1967). Henri de Decker, Nation et développement communautaire en Guinée et au Sénégal (Paris: Mouton, 1958).
22. La Guinée libre, No. 13 (Mar. 14, 1974).
23. Source: Direction générale de la Statistique de la République de Guinée.
24. La Guinée libre, No. 13 (Mar. 14, 1974).
25. Ibid.
26. Sékou Touré, speech made Sept. 29, 1973, rebroadcast by Radio Conakry and monitored at Dakar.


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