GUINEA-BISSAU

RISK RATING
High
Default High Risk Score 7.50
Normal Average 5.85
Weighted Average 5.93
RISK RATING HISTORY
RISK RATING SCALE

Risk Rating Scale

Severe: 8.0 to 10
High: 6.0 to 7.9
Elevated: 4.0 to 5.9
Moderate: 2.0 to 3.9
Low: 0.0 to 1.9
EXCHANGE RATE
Country Outlook

Despite holding peaceful presidential elections towards the end of 2019, Guinea-Bissau has been steeped in political chaos ever since. By exploiting crisis fatigue by regional and international stakeholders as well as the pandemic, current President Umaro Sissoco Embal贸 has ultimately had a free hand to entrench his position. By exploiting this gap, Embal贸 is likely to face few obstacles to any further crackdown on the opposition and to any new policies he implements. Concerns now revolve around the current review of the country鈥檚 constitution, which may be manipulated to consolidate Embal贸鈥檚 presidency as well. Moreover, while Guinea-Bissau has a long history of political violence, Embal贸 enjoys the support of the military and has surrounded himself with powerful political and military elites to secure his tenure. Embal贸 leads a weak government loosely aligned with the anti-reformist agenda, which will be unable to push through the necessary reforms to curb the drugs trade, reform the military, and push through urgently socio-economic reforms.

  • Political contestation between the new president and opposition leaders allied with the PAIGC party has escalated, where at one point in 2020 the country had two competing presidents and two prime ministers. Political instability has also been characterised by the involvement of the military in politics, the violent suppression of opposition voices, and growing evidence of drug trafficking. President Embal贸鈥檚 MADEM 鈥 G15 party is controlled by businessman Braima Camara, who is a staunch ally of former president Jos茅 M谩rio Vaz. However, they will face a strong challenge from former prime minister Domingos Simoes Pereira who has revamped the powerful PAIGC party into a reformist and progressive movement. Pereira remains popular with youths in coastal areas, including in the capital Bissau.
  • A resurgence in the drug trade threatens to bolster the financial support base for Islamist militant groups across the region. The connection between Sahel-based militancy and organised crime has been well-documented, where Islamist militants have integrated their activities with those of smugglers and armed criminal gangs by providing security for smuggling operations 鈥 including narcotics trafficking. Through exploiting a resurgence in the regional drug trade, militant groups in the Sahel region could reinvigorate their financial flows, providing them with the means to purchase greater amounts of armaments and equipment. The departure of the UN mission at the end of 2020 has the potential to undermine political freedom, security, and the fight against drug trafficking even further.
  • The threat of economic sanctions, combined with an ECOWAS withdrawal, could leave the government at its most vulnerable. Not only would the incumbent be starved of the limited financing it has to secure its executive power, but the removal of the ECOWAS peacekeeping mission means it would no longer have a deterrent to a power play by the military. Officially, the country relies mostly on agriculture and fishing, where an estimated 90 percent of GDP stems from cashew, peanut, Brazil nuts and coconut production. However, a significant portion of wealth comes from controlling networks used to smuggle drugs from South America into Europe.
CUMULATIVE AND DAILY COVID-19 INFECTIONS AND DEATH RATE
INTERNATIONAL MONETARY FUND | DATAMAPPER
Risk Perils
Political Instability
6.0
Expropriation, Nationalisation, Confiscation & Deprivation
6.0
Contract Frustration & Breach
6.0
Taxation
6.0
Bribery & Corruption
7.5
Regulatory Burden
6.0
Strikes, Riots & Civil Commotion
5.0
Security
5.0
Sovereign Default
5.0
Economic Volatiliy
6.0

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