Gabon is a central African country rich is natural resources. It is bordered by Cameroon, Equatorial Guinea, and the Republic of Congo to the east, and the Atlantic Ocean to the west. With a population of 1.6 million over a surface area of 268,000 square kilometers, Gabon is a sparsely populated country with forests covering 85% of the territory.
It possesses one of the highest urbanization rates in Africa with more than four in five Gabonese citizens living in urban areas. The capital, Libreville, along with Port Gentil, the economic capital of the country, is home to 59% of the population. One in two Gabonese citizens is under the age of 20, and the fertility rate in urban areas stands at almost four children per woman, against six in rural areas according to the 2012 Second Demographic and Health Survey conducted in Gabon.
A former French colony, Gabon obtained independence in 1960. The Gabonese Democratic Party [Parti démocratique gabonais or PDG] of Omar Bongo, former president of Gabon from 1968 to 2009, continues to dominate political life. His son, Ali Bongo Ondimba, won the presidential elections in August 2009 against a backdrop of social crisis. Both the municipal and departmental elections held in December 2013, and the Senate election held in December 2014, were marked by a return of the opposition party which had boycotted the legislative elections in 2011 yet resulted in a victory for the party in office. The next presidential elections will take place in 2016.
Following his election, Ali Bongo established a political agenda aiming to transform Gabon into an emerging country by 2025. To achieve this, the government implemented the Strategic Plan for an Emerging Gabon (Plan Stratégique Gabon Emergent - PSGE), a three-pronged strategy that seeks to leverage industry, sustainable natural resource management, and services. The first pillar entitled “Industrial Gabon” will work to make the country a thriving industrial hub while the second pillar, “Green Gabon”, will ensure sustainable forest management and transform Gabon into a global leader of certified tropical timber production. The third pillar, “Service-Oriented Gabon”, intends to create jobs in growth-promoting sectors such as information and communication technology (ICT) and ecotourism.
In January 2014, Professor Daniel Ona Ondo, the former vice president of the National Assembly, was appointed prime minister and was tasked with implementing the strategic plan "Emerging Gabon" and tackling inequality.
Gabon is ranked as an upper-middle-income country. The fifth largest oil producer in Africa, Gabon has experienced strong economic growth over the past decade, driven in particular by oil and manganese production. On average, over the past five years, the oil sector has accounted for 80% of exports, 45% of GDP, and 60% of budget revenue. However, the country is facing a decline in its oil reserves. The Gabonese government has therefore based its new strategy on economic diversification.
Economic growth slowed from 5.6% in 2013 to 4.3% in 2014. The economic slow-down was largely due to the significant decline in global oil prices—which translated into a reduction of planned public investment by 50%. Over the past five years, increases in public investment have been the main driver of growth in Gabon, and a decline in such investments has severely affected the local construction sector.
The reduction in public investment caused total expenditure to decline from 29% to 24% of GDP between 2013 and 2014. Total revenue in 2014 was equivalent to 26.5% of GDP, down from 31% the preceding year, while the year-end overall fiscal balance (commitments basis) improved from 1.8% of GDP in 2013 to 2.8% in 2014 due to the sharp contraction of public investment.
Oil prices are expected to remain well below 2013 levels in the medium-term. Lower forecasts of public investment have dampened GDP growth estimates for 2015 by two percentage points, from 6.0 to 4.1%. Growth will continue to be driven by public investment, oil production, services, manganese mining, and wood-processing. In the oil sector, following the price decline, investments programs are expected to be revised and some drilling operations might be postponed. Inflation is expected to decelerate to 2.5% in 2015 compared to 4.5% in 2014.
Lower oil revenues will lead to further deterioration of the fiscal balance. The overall fiscal balance is projected to record a deficit of 3.5% of GDP in 2015 (from a surplus of 2.4% of GDP in 2014), following lower international oil prices. The external balance is also expected to switch from a 12.1% of GDP surplus in 2014 to a 2.1% deficit.
Recognizing the challenges of economic diversification and the need to better harness revenues from the extractive industries sector to reverse growing inequity and poverty in the country, the Gabonese president has launched the Strategic Plan for an Emerging Gabon (Plan Stratégique Gabon Emergent - PSGE).
Despite having a relatively high per capita income (GDP of $11,571 per capita based on data for 2013), the poverty rate remains high in Gabon—one in three Gabonese citizens is still living below the poverty line of $1.25 a day. Gabon occupies 112th place out of 189 countries on the 2014 Human Development Index established by the United Nations Development Programme (UNDP). According to the Millennium Development Goals 2013 National Report, despite having an enrollment rate of 96.4% (one of the highest in Africa), the country’s education system remains characterized by a high repetition rate and a low primary completion rate (37.2%). Based on statistical data from the National Employment Office [Office national de l'emploi ONE], the unemployment rate for young people under the age of 30 stands at 30%. According to the 2012 Second Demographic and Health Survey (DHS-II 2012), the majority of women and men aged 15 to 49 do not have health insurance.
Nevertheless, the country has made noteworthy progress in the area of maternal and child health. The child mortality rate for children under the age of five is less than 31% (65 deaths per 1,000 live births in 2012 against 94.4 per 1,000 in 1990) and the maternal mortality rate is less than 39% (133 deaths per 100,000 live births in 2012). However, this progress remains insufficient and is far from the target set by the Millennium Development Goals (MDG).
In an effort to improve social indicators in Gabon, President Ali Bongo Ondimba called on the government to implement new social measures as part of a “Social Pact” in January 2014. The initiative consists of three main components: the implementation of a mandatory health insurance and social security system, the provision of economic safety nets and a social solidarity fund, and the expansion of income-generating activities for the poor.
Last Updated: Apr 09, 2015