Guinea - Early Economic Development
Before independence in 1958 Guinea was regarded as the most favorably endowed territory of French West Africa in agricultural, mineral, and hydroelectric potential. Relatively little had been done, however, to develop this potential, and the difficult conditions under which Guinea had obtained its independence had brought new setbacks, requiring an entirely fresh start. In the wake of France's immediate withdrawal of assistance, the new republic's short-term economic difficulties were overcome to some degree by foreign aid from other countries, notably communist states. Economic well-being, however, was short lived.
In the early years of sovereignty, initial progress toward the goal of economic autonomy was made through the pervasive efforts of the party and government machinery — a system that, in its political context, was described by many observers as one of the best organized in Africa. The pervasive government machinery was less effective, however, in exercising its far-reaching economic functions. The proclaimed objective was to organize the economy along noncapitalist lines with state control of production and trade.
By the 1970s satisfaction of the country's long-range economic needs was yet to be resolved. The rate of economic growth since independence was thought to have barely kept pace with the growth of population. Agricultural production for the official market had stagnated, and the processing industries installed by foreign aid were mostly operating below capacity. Moreover, the government had to a large extent lost control over the level of economic activity and had been unable to curb inflation and maintain the value of its currency. Widespread rural underemployment, limited urban employment, an extreme shortage of consumer goods, and a flourishing black market and smuggling trade were all evidence of the country's economic malaise.
As an alternative the government became more and more reliant on exploitation of Guinea's rich bauxite resources, estimated by some experts as surpassing in size and purity all of the world's known deposits except those of Australia and Brazil. Typical of the pragmatic policies adopted by the regime of President Touré, exploitation of the bauxite had been made possible by resorting to capitalistic methods involving agreements with foreign investors whose companies provided the technological and financial assistance required.
Since independence the major lines of the republic's foreign policy were generally determined by pragmatic considerations, a situation generated largely by the need for external assistance. Moreover, Guinea's relations with other countries were affected by actions that the government had often regarded as threats to its security. In periods of internal crisis, President Touré imposed a policy of extreme isolationism. In contrast his foreign policy had been more outward looking when domestic conditions have been relatively stable. For many foreign nations, particularly neighboring African states, the "Guinean revolution" that had raised such hopes when it was initiated in 1958 had by the 1970s lost much of its idealistic attraction.
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