Equatorial Guinea's government is aiming for a balanced State budget for fiscal year 2027, deepening its fiscal adjustment as hydrocarbon output heads into structural decline.
The Ministry of Finance, Planning and Economic Development reviewed the draft 2027 finance law at its eighth ordinary board meeting on August 14. The balanced-budget target comes as the country seeks to preserve public debt sustainability and external reserves while repairing public finances.
Equatorial Guinea's fiscal policy is anchored in a staff-monitored program with the International Monetary Fund extended to 2026, which calls for a gradual reduction of the non-hydrocarbon primary deficit and keeping public debt below 50% of GDP by 2030.
The IMF completed the third review of the non-financing program in December 2025, with the authorities meeting all quantitative conditionality and three structural benchmarks and approving a 2026 budget consistent with program objectives, according to an IMF country assessment.
Real GDP is projected to fall by 6.4% in 2025, driven by an anticipated 16.8% drop in hydrocarbon output, while hydrocarbon production contracts on average by 6.5% per year over 2025–2030. The African Development Bank notes that despite diversification efforts, oil still accounts for more than half of State revenues, leaving the medium-term fiscal balance fragile.
The World Bank describes the economy as heavily dependent on oil and gas, as hydrocarbon production accounts for about 39% of GDP, 76% of exports and 86% of government revenue. The overall fiscal balance returned to surplus by mid-2025, driven by higher hydrocarbon revenues in value terms and rising non-hydrocarbon revenues, though the non-oil primary balance remains clearly in deficit.
From 2027 onwards, the adjustment will increasingly rely on new tax policy measures to boost non-hydrocarbon revenues, identified through a recent tax policy diagnostic. The non-oil sector is projected to reach 66.4% of GDP by 2028 as the economy transforms.
