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In 1980, João Bernardino ("Nino") Vieira was at the head of
a coup d'état. He had been one of the most important
guerilla commanders in the days of the guerrilla struggle.
All the constitutional institutions were replaced by a
Council of State headed by Vieira himself. He interrupted
the merger process with Cape Verde while the two countries
discussed the drafting of a common constitution (see Cape
Verde ). The new government was immediately recognized by
neighboring Guinea, with which the former government led by
Luiz Cabral had a tense relationship, due to disagreement
over sea rights in an area where there was supposed to be
oil.
Contact between the two Guineans intensified after a
conference was held in 1982 for the former Portuguese
colonies in Africa in the city of Praia. The following year,
the two countries exchanged ambassadors.
According to
Countryaah,
the first development plan (1983-86) necessitated an initial
injection of $ 118.6 million, 75% of which came from abroad.
In 1984, the construction of 5 ports began at an estimated
value of $ 40 million and the Bissalanca airport was
completed. The government launched a campaign against
corruption and the ineffectiveness of public administration
that went as far as the ministries. In 1984, the country's
Vice President Víctor Saúde María was removed from his post,
the People's Assembly abolished the Prime Minister's post
and the Revolutionary Council was transformed into a Council
of State.
In November 1984, Council Vice President Colonel Paulo
Correia tried to overthrow Vieira. The motives for the coup
attempt were apparently personal, although ethnic
contradictions that have existed since the colonial era
cannot be ignored. Correia was executed in July 1986.
The stabilization plan that had been in progress since
1984 failed, which worsened the economic and financial
situation. A contributing factor was also the rise in oil
prices and the fall in the price of the country's export
products. 60% of the country's revenue comes from exports of
dates and peanuts, whose prices on the world market dropped
dramatically.
The government took a series of drastic steps, froze
wages, reduced public investment, etc., and thus fulfilled
the IMF's demands for debt restructuring. Subsequently, the
economy was opened to foreign capital, in particular to
attract capital from France and Portugal to be used to
modernize the country's telecommunications and telephone
system. In 1989, Lisbon participated in the creation of a
foreign trade bank.
In February 1991, PAIGC enacted a political reform to
precede the elections in 1992. The resignation of Finance
Minister Manuel dos Santos prompted the IMF to freeze some
of the credits it had received. The World Bank deferred the
disbursement of a $ 6.5 million loan to force Guinea-Bissau
to pay down the repayments on its foreign debt promptly. The
loan was to be used as structural adjustment program
launched in 1987.
Dependence on agricultural exports in 1992-93 led to
considerable social and economic imbalance. This imbalance
was followed by political tensions. The planned elections in
1992 were postponed by the government and after the
assassination of a senior officer in March 1993, they were
further postponed.
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