February 6, 2026

Washington, DC: Management of the International Monetary Fund (IMF) approved the completion of the Third Review of the non-financing Staff Monitored Program (SMP) with Equatorial Guinea on December 16, 2025. The SMP is designed to support the authorities' reforms to adjust the economy to structurally lower hydrocarbon output.

Equatorial Guinea's economic activity is estimated to have contracted by 6.4 percent in 2025 on the back of a large fall in hydrocarbon production, following small positive overall growth in 2024. The economy is expected to slightly shrink in the medium term as hydrocarbon production continues to decline. Inflationary pressures have abated, with inflation decreasing from a peak of 3.5 percent in March 2023 to 2.6 percent in October 2025.

The authorities maintained gains from the substantial 2024 fiscal adjustment in the first half of 2025, in line with the objective of a non-hydrocarbon primary balance of -17.8 percent of non-hydrocarbon GDP in 2025 as a whole. This fiscal stance is expected to have resulted in an increase in public debt from 36.4 percent of GDP in 2024 to 39.2 percent of GDP at the end of 2025. Equatorial Guinea's contribution to foreign reserves at the regional central bank remained negative in 2025, following a reserve loss in 2023 and 2024. The authorities' planned further fiscal adjustment will aim to keep public debt below 50 percent of GDP despite the projected decline in hydrocarbon revenues and to restore external balance in the medium term.

The authorities have implemented substantial reforms over the past year in the context of the SMP. Fiscal policy in 2025 was in line with their plans to stabilize the public debt dynamics and restore external balance. It was underpinned by impactful structural fiscal measures to improve tax and customs administration. The authorities also continued to prioritize social spending and eliminated fees for students to travel on public school buses. They worked to obtain regional regulatory approval for their domestic arrears clearance plan to further strengthen the health of the financial sector.

The authorities' policies allowed them to meet all of the SMP's end-June 2025 quantitative conditionality as well as two of the four end-September 2025 program structural benchmarks. In addition, they approved a 2026 budget consistent with program objectives, meeting an end-December 2025 structural benchmark as well. The authorities are making progress toward establishing a track record for financial assistance from the IMF under the Upper Credit Tranche. Establishing a satisfactory track record continues to hinge on the authorities' implementation of governance reforms, in particular the publication of a hydrocarbon sector transparency report, the work on which has already begun.

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