Equatorial Guinea: Second Richest Country in the World!

Which country is the second richest in the world? Many of us know that Luxembourg holds the top spot, but few would link Equatorial Guinea—a small African nation located between Cameroon and Gabon—to such a title.

Yet there it is. Thanks to the discovery of massive offshore oil reserves, Equatorial Guinea has become one of the world’s richest countries by per capita income, boasting roughly $50,200 per person—second only to Luxembourg.

Endowed with enormous natural wealth, the country nonetheless paints a grim picture for ordinary citizens. According to the CIA World Factbook at the time:

“Despite the country’s economic windfall from oil production resulting in a massive increase in government revenue in recent years, there have been few improvements in the population’s living standards. Businesses, for the most part, are owned by government officials and their family members.”

The undeveloped natural resource base is also substantial, including titanium, iron ore, manganese, uranium, and alluvial gold. It is plausible that the country will eventually overtake Luxembourg in nominal per capita terms once these resources are extracted.

For ordinary citizens, however, Equatorial Guinea will likely remain a very poor country in practice. Oil revenues flow into elite pockets, not into households. This is a classic example of the “resource curse”: extraordinary natural wealth that generates extraordinary inequality rather than broad-based development.

The contrast between statistical wealth and lived poverty makes Equatorial Guinea one of the most striking illustrations of why GDP per capita is a poor proxy for national welfare when institutions fail to distribute gains broadly.