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PRESS/TPRB/168
28 June 2001
(01-3234)
GABON'S ECONOMIC REFORM STANDS TO GAIN FROM GREATER
PARTICIPATION IN THE MULTILATERAL TRADING SYSTEM
Economic reform in Gabon would stand to gain from greater participation in the multilateral
trading system, according to a WTO report on the trade policies and practices of Gabon.  Engaging in
a sustained dialogue with trading partners, and greater enforcement of WTO rules and disciplines
would constitute a more effective bulwark against protectionist pressures.  Once Gabon succeeds in
the transition to the post-petroleum economy, based more on private enterprise than state-directed
economic activity financed by oil revenues, the country will better realize the opportunities for tradeoffered by the multilateral trading system.  The report also underlines the benefits of technical
assistance in achieving greater participation.
The WTO Secretariat report, along with the policy statement by the Government of Gabon,
will serve as a basis for the first trade policy review of Gabon by the Trade Policy Review Body ofthe WTO on 26 and 28 June 2001.
The report notes Gabon's engagement since the early 1990s in two transitions with far-
reaching implications for the country's future.  Th e first was the introduction of competition into the
domestic market to pave the way for the post-petroleum economy.  The second transition concernedthe democratization of political life and should  culminate in 2005 in the first change-over of
presidential power since 1967.
The economic reform aims to achieve a diversified and competitive economy that is capable
of achieving labour market equilibrium by generating employment.  While oil is Gabon's main
revenue source, national production has been contracting since 1997 and seems set to continuedownwards unless major new finds are made.  The country has since been gripped by economic crisis
- the 9.6 per cent contraction in real GDP in 1999 was followed by yet another retreat of 1.3 per cent
in 2000.PRESS/TPRB/168
Page 2
MOREThanks to oil revenue, which accounts for 60 per cent of the national budget, the State has
long been the leading employer and investor, al so sustaining Gabonese enterprises by means of
government procurement.  Public spending controls have led to shrinking domestic investment in
recent years.  The industrial and farm sectors have not filled the gap, as they are largely
underdeveloped;  services could also make a greater contribution to economic activity.  The
population's needs in terms of food and manufactures are met by imports for the most part, financedby revenue from oil exports mainly, and also lumber.
Higher world oil prices in 1999 and 2000 more than offset the contraction in the volume
exported and yielded higher oil export earnings (75 per cent of the total).  Renewed exports of forestry
products have also been noteworthy in terms of volume and international market prices.  Exports of
all products rose by one third in 1999 and by 20 per cent in 2000 (in United States dollars).  In
contrast, imports fell in 1999 and increased more slowly than exports in 2000.  Gabon therefore
posted a current account surplus for 1999 and 2000.
Gabon, although rich in per capita terms, is highly indebted and has had persistent difficulty
in maintaining debt service.  The authorities envisage mounting problems over the 2002-2005 period
owing to dwindling oil revenue from contracting national oil output.  The authorities intend to
continue their efforts to gain control of public spending and to increase non-oil receipts through more
efficient collection methods so as to ensure surpluses on a sustained basis.
After concluding an agreement with the IMF at the end of 2000, Gabon is pushing ahead with
reform on three main fronts:  fiscal consolidation to ensure macroeconomic stability;  privatization to
reduce the structural constraints on the economy;  and reform of the civil service in order to
streamline it and enhance the efficiency of the services provided to citizens.
Gabon is counting on foreign investment outside the petroleum sector to support a new base
for economic activity.  The privatisation of state-owned enterprises is one way of doing this.  The
following state-run enterprises have already been privatized:  water and electricity (in 1997), sugar
(1997), extraction of timber (1998), importation and distribution of food and sundry products (1998),
the railways (1999), and cement (2000).  The pr ivatization process has lost momentum since 1999,
however.  Priority privatizations for 2001 are in the telecommunications, air transport andagribusiness sectors.
Gabon has improved the environment for business activity by significant reform of key
aspects of regulation.  A new investment code has been brought in, offering standard protections, as
well as modified sectoral codes for investment in forestry, mining and petroleum.  Enterprise
establishment has been simplified by a one-stop procedure.  Also significant is the implementation ofnew commercial laws, agreed at regional level under OHADA.  Further reforms are planned, in
particular by legislative approval of a draft anti-corruption law and a revised Labour Code.
Trade reform has also played an important role in the new business environment.  Gabon's
external trade policy consists mainly of the policy decided by the Central African Economic and
Monetary Community (CAEMC), which absorbed the Central African Customs and Economic Union
(CACEU), created in 1964.  Trade reform and the process of regional integration were re-launched
through the fiscal and customs reform of 1993, which followed the devaluation of the CFA franc in1992.  The reform has given rise to a Common External Tariff (CET), a Generalized Preferential
Tariff (GPT) and limits on levels of turnover tax and excise duties.
The levels of tariffs agreed under the CET are higher, in some 40% of lines, than the levels
bound by Gabon in its WTO schedule.  The Government plans to re-negotiate its bound tariff to
eliminate the difference with applied tariff levels and achieve consistency between regional andPRESS/TPRB/168
Page 3
MOREmultilateral levels of trade policy.  In other respects, Gabon's participation in the multilateral system
has also fallen short of government expectations, owing to the limited resources available for that
purpose.  Few notifications have been made and there are gaps in the understanding of the system and
its potential benefits for Gabon.
The report says that the authorities should consider making a stronger commitment on
services under the GATS and its fourth and fifth protocols with a view to stimulating investment inservices.  The aim would be to provide investors with a business climate in which the basic support
services for production and international trade – transportation and communications, finances and
energy – would be available at competitive prices.
Note to Editors
Trade Policy Reviews are an exercise, mandated in the WTO agreements, in which member
countries’ trade and related policies are examined and evaluated at regular intervals. Significant
developments which may have an impact on the global trading system are also monitored. For eachreview, two documents are prepared: a policy stat ement by the government of the member under
review, and a detailed report written independently by the WTO Secretariat. These two documents are
then discussed by the WTO’s full membership in the Trade Policy Review Body (TPRB). These
documents and the proceedings of the TPRB’s meet ings are published shortly afterwards. Since 1995,
when the WTO came into force, services and trade- related aspects of intellectual property rights have
also been covered.
For this review, the WTO’s Secretariat report, together with policy statements prepared by the
Government of Gabon will be discussed by the Trade Policy Review Body on 26 and 28 June 2001.
The Secretariat report covers the development of all aspects of  Gabon trade policies, including
domestic laws and regulations, the institutional framework, trade policies by measure and by sector.
Attached to this press release is a summary of the observations in the Secretariat report and
parts of the Government policy statement. The full Secretariat report and all the governments' policy
statements are available for the press in the newsroom of the WTO internet site (www.wto.org). These
documents and the minutes of the TPRB’s discussion and the Chairman’s summing up, will be
published in hardback in due course and will be available from the Secretariat, Centre WilliamRappard, 154 rue de Lausanne, 1211 Geneva 21.PRESS/TPRB/168
Page 4
MORESince December 1989, the following reports have been completed: Argentina (1992 and
1999), Australia (1989, 1994 and 1998), Austria (19 92), Bahrain (2000) Bangladesh (1992 and 2000),
Benin (1997), Bolivia (1993 and 1999), Botswa na (1998), Brazil (1992, 1996 and 2000), Brunei
Darussalam (2001), Burkina Faso (1998), Cameroon (1995), Canada (1990, 1992, 1994, 1996, 1998
and 2000), Chile (1991 and 1997), Colombia ( 1990 and 1996), Costa Rica (1995 and 2001), Côte
d’Ivoire (1995), Cyprus (1997), the Czech Republi c (1996), the Dominican Republic (1996), Egypt
(1992 and 1999), El Salvador (1996), the Eu ropean Communities (1991, 1993, 1995, 1997 and 2000),
Fiji (1997), Finland (1992), Gabon (2001), Ghana (1992 and 2001), Guinea (1999), Hong Kong
(1990, 1994 and 1998), Hungary (1991 and 1998), Iceland (1994 and 2000), India (1993 and 1998),
Indonesia (1991, 1994 and 1998), Israel (1994 and 1999), Jamaica (1998), Japan (1990, 1992,
1995,1998 and 2000), Kenya (1993 and 2000), Korea, Rep. of (1992, 1996 and 2000), Lesotho
(1998), Macao (1994 and 2001), Madagascar (2001), Malaysia (1993 and 1997), Mali (1998),
Mauritius (1995), Mexico (1993 and 1997), Morocco (1989 and 1996), Mozambique (2001), NewZealand (1990 and 1996), Namibia (1998), Nicaragua (1999), Nigeria (1991 and 1998), Norway
(1991, 1996 and 2000), OECS-WTO Members (2001), Pakistan (1995), Papua New Guinea (1999),
Paraguay (1997), Peru (1994 and 2000), the Philippines (1993 and 1999), Poland (1993 and 2000),
Romania (1992 and 1999), Senegal (1994), Si ngapore (1992, 1996 and 2000), Slovak Republic
(1995), the Solomon Islands (1998), South Africa (1993 and 1998), Sri Lanka(1995), Swaziland(1998), Sweden (1990 and 1994), Switzerland (1991, 1996 and 2000 (jointly with Liechtenstein),
Tanzania (2000), Thailand (1991, 1995 and 1999), Togo (1999), Trinidad and Tobago (1998), Tunisia
(1994), Turkey (1994 and 1998), the United States (1989, 1992, 1994, 1996 and 1999), Uganda
(1995), Uruguay (1992 and 1998), Venezuela (1 996), Zambia (1996) and Zimbabwe (1994).PRESS/TPRB/168
Page 5
MORETRADE POLICY REVIEW BODY
GABON
Report by the Secretariat – Summary Observations
In the 1990s, Gabon embarked on two transitions with far-reaching implications for the
country's future.  The first was the introduction of competition into the domestic market to pave the
way for the post-petroleum economy.  The second transition concerned the democratization of
political life and should culminate in 2005 in the first change-over of presidential power since 1967.
Economic reform started in Gabon in 1986 under the first structural adjustment programme.
It has gathered pace since the 1994 devaluation of the CFA franc as part of a renewed subregionalintegration process;  participation in the multilateral system has not yet been made an operative factor
in the reform.  Foreign trade has been liberalized, VAT and excise taxes have been introduced, the
turnover tax has been updated and new systems created for regulating and supervising financial
services.  In future, integration will be pursued within a new structure, the Central African Economic
and Monetary Community (CAEMC), launched in 1998.
The Gabonese authorities completed these reforms by adopting a new Investment Charter and
updating some sectoral codes (mining and tourism).  Gabon has also started the privatization of state-
owned companies.  A competition policy has been drawn up but has not yet been put into practice.
After concluding an agreement with the IMF at the end of 2000, Gabon is pushing ahead with
reform on three main fronts:  fiscal consolidation to ensure macroeconomic stability;  privatization toreduce the structural constraints on the economy;  and reform of the civil service in order to
streamline it and enhance the efficiency of the services provided to citizens.  Gabon is also committed
to mounting a well-targeted operation to root out corruption more effectively.
The economic reform aims to achieve a diversified and competitive economy that is capable
of achieving labour market equilibrium by generating employment.  While oil is Gabon's mainresource, its national production has been contracting since 1997 and seems set to continue
downwards unless new finds are made.  Thanks to oil revenue, which accounts for 60 per cent of the
national budget, the  State has long been the le ading employer and investor, sustaining Gabonese
enterprises by means of government procurement.  The industrial and farm sectors are largely
underdeveloped and the population's needs in terms of food and manufactures are met by imports forthe most part.
Three-quarters of the population live in urban areas and rural-urban drift is being spurred by
low yields from subsistence farming.  Unemployment and a large informal sector are quite evident.
The level of social well-being is below that which would correspond to the per capita income, which
translates into poverty.
The country also has a high level of external debt and has been struggling with debt service
for a long time, even though the Paris Club has accorded debt service reductions, the last being at theend of 2000.  Dwindling oil revenues are threatening to worsen unemployment and poverty and
complicate debt management, unless the private sector is invigorated in such a way as to replace the
State as the basis of the economy.PRESS/TPRB/168
Page 6
MOREFor the post-petroleum economy, Gabon is relying on a strategy of industrial development,
specifically the processing of wood, fisheries-related activities, as well as the processing of mineral
and energy resources, and it hopes to develop its tourism potential.  The authorities are also seeking to
give fresh impetus to the farming sector.
Economic environment
Trends in domestic oil production and world oil prices have a decisive impact on the
Gabonese economy.  The country has been gripped by economic crisis since domestic output started
its decline in 1997.  The 9.6 per cent contraction in real GDP in 1999 was followed by yet another
retreat of 1.3 per cent in 2000.  The underlying reasons were falling oil output and shrinking domestic
investment owing to the need to control public sp ending, even though the lumber industry has shown
some renewed buoyancy.  Inflationary pressures were kept under control in 2000.
Higher world oil prices in 1999 and 2000 more than offset the contraction in the volume
exported and yielded higher oil export earnings (75 per cent of the total).  Renewed exports of forestry
products have also been noteworthy in terms of volume and international market prices.  Exports of
all products rose by one third in 1999 and by 20 per cent in 2000 (in United States dollars).  In
contrast, imports fell in 1999 and increased more slowly than exports in 2000.  Gabon therefore
posted a surplus on current account for 1999 and 2000.
Trade policy-Multilateral policy
Gabon became a founding Member of the WTO, continuing its relationship with the GATT
1947 which started in 1963.  Gabon accords at least most-favoured-nation (MFN) treatment to imports
from WTO Member countries.  Gabon has notified that the Customs Valuation Agreement would beapplied as of 2000, with some reservations.  As part of the African Group, the country is currently
participating in the discussions on the future programme of the WTO, and played host to the Meeting
of African Trade Ministers in Libreville in November 2000.
During the Uruguay Round, Gabon bound its customs duties on all tariff lines, with ceilings
of 15 per cent for most non-agricultural products and 60 per cent for agricultural produce.  Thearithmetic average of bound tariffs is 22.2 per cent , whilst the average MFN tariff applied by Gabon is
18.3 per cent for 2001.  It is noteworthy, however, that the applied tariffs are above the bound levels
for some 40 per cent of tariff lines (see below).
Gabon's specific commitments under the GATS relate to financial services and tourism.  As
regards insurance (including life insurance), banking and other financial services, the principles ofmarket access and national treatment are applied without limitation, except in relation to the
movement of natural persons.  Gabon permits the entry and temporary stay of managers, senior
executives and experts.
Gabon has availed itself of the transitional arrangements in Article 65 of the TRIPS
Agreement in order to delay its full implementation (except for Articles 3, 4 and 5) until the year
2000.  This is contemplated by the African Intellec tual Property Organization (OAPI) created under
the Bangui Agreement in 1977, of which Gabon is a member.  The OAPI updated the relevant
provisions, and the revised Bangui Agreement was signed in 1999.  Gabon has ratified it, though it is
still awaiting ratification by five of the 15 member countries, expected in the course of 2001, in order
to come into force.  The protection of intellectua l property rights falls within the purview of the
national authorities, their police forces and their judicial systems.PRESS/TPRB/168
Page 7
MOREGabon's participation in the multilateral system has fallen short of government expectations
owing to the limited resources available for that purpose.  Few notifications have in fact been made
and there are gaps in the understanding of the system and its potential benefits for Gabon.  The
country would therefore like to have the support of the WTO Members and Secretariat, in particular
through technical assistance.
Regional policy
Gabon's trade policy consists mainly of implem enting the policy decided jointly with its
neighbours within the Central African Customs and Economic Union (CACEU), which was created in
1964 and is now part of the CAEMC arrangements.
Regional integration was re-launched through the fiscal and customs reform of 1993.
Amongst other things, it has given rise to a Common External Tariff (CET), a Generalized
Preferential Tariff (GPT) and an agreement on turnover tax and excise duties.  To reduce the number
of duty rates and make the tariff more transparent, products have been placed into one of the fourfollowing categories:  5 per cent, 10 per cent, 20 per cent and 30 per cent.  The GPT was rolled back
to zero in 1998 and applies only to products originating from the CACEU based on strict rules of
origin.
The countries have also agreed to eliminate a good many waivers of duties and charges, as
well as quantitative restrictions.  Gabon dismantled these restrictions in 1996, except for those onsugar and mineral water, though only the first is currently in effect.  The Gabonese authorities have
advised that this will remain so until 2004.  Import permits and sanitary and phytosanitary certificates
are required for farm produce and permits must also be issued for hazardous products (weapons,
explosives, chemical products).
Under the fiscal and customs reform, the CACE U member countries had accorded themselves
the right to levy a temporary surcharge (of at most 30 per cent) on a list of goods imported from all
origins until 30 June 2000.  As of April 2001, however, Gabon had not yet definitively eliminated this
temporary surcharge.  It currently stands at 20 per cent and affects 25 tariff lines, including vegetable
oils, soap and cigarettes.  Owing to the application of the CET and the surcharge, the arithmetic
average of Gabon's customs duties is 18.3 per cent for 2001.
It should be pointed out that by operation of the CET and the surcharge, Gabon's effective
levels of customs duties are above the ceilings contained in Schedule XLVII, for some 40 per cent of
tariff lines.  This is largely the result of the lack of internal coordination amongst the ministries
concerned with the Uruguay Round negotiations and those concerned with regional trade policy.  The
Gabonese authorities became aware of this in prepar ing the trade policy review and intend to remedy
the situation.
In addition to the CET and the surcharge, imports into Gabon are subject to VAT (18 per
cent) and some (alcoholic beverages, tobacco products) are also subject to excise duties.  These direct
taxes are levied on local products, with some exceptions (cement, sugar, mineral water, poultry) or the
goods produced by some state-run enterprises (mineral water, soap, oils), or local products from
farmers, livestock breeders, fishermen and hunters, these being accorded waivers or reductions.  No
trade protection measures are applied to imports.  Gabon recently passed a law in this regard, but theimplementing regulations have yet to be issued.
It must be observed that the Gabonese authorities find it difficult to liberalize trade when
there is a domestic competitor.  The prolongation of the surcharge, for instance, was the result of
opposition by domestic producers to market opening.  Yet the small number of local industriesPRESS/TPRB/168
Page 8
MOREensures that most imports of staple consumer goods need not contend with exorbitant customs duties
or with charges higher than those assessed on local production.
Gabon allows enterprises in the favoured sectors – oil and other minerals, forestry, tourism –
to import their equipment and materials under a regime free of duties and charges or under temporary
admission.  Duties and charges are also waived on some essential goods.  As a result of exemptions
and reductions of duties and charges, Gabon's customs receipts are shrunk by about one-quarter.  Thisloss is significant as customs receipts accounted for about one-third of non-oil revenue in 1999 and
will represent a larger share of public finances in the post-petroleum economy.
Investment policy
Gabon hopes to encourage foreign investment in order to attain its industrial development
strategy targets.  The privatisation of state-owned enterprises is one way of doing this.  The following
state-run enterprises have already been privatized:  water and electricity (in 1997), sugar (1997),extraction of timber (1998), importation and distribution of food and sundry products (1998), the
railways (1999), and cement (2000).  The priv atization process has lost momentum since 1999,
however.  Privatizations for 2001 pertain chiefly to the enterprises in fixed-line telephony, air
transport and agribusiness.
Since 1998, investments have been regulated by a new Charter, not including tourism and
sectors linked to natural resources, which belong to the State and are governed by specific codes that
have also been updated.  Foreign investors are entitled to the privileges and protection currently
accorded on the international market.  The new investment regime applies without distinction to all
investors, both foreign and Gabonese, with the exception of support measures provided by the State to
small and medium-sized enterprises, provided that their capital is 51 per cent Gabonese and they aremanaged by Gabonese nationals.
To help new enterprises to set up in Gabon, the Charter envisages a promotion agency, which
was created in 2000.  Its single window will simplify the formalities for the incorporation of
enterprises and will come on stream during 2001.
Foreign companies may also employ non-Gabonese workers under certain conditions.  The
hiring of Gabonese workers is still subject to the Labour Code:  Parliament is now discussing the
easing of the Code's provisions.
Sectoral policies
Agriculture
This sector comprises two major branches both of which are in difficulty.  A quarter of the
country's population lives outside of urban centres and engages in low-yield subsistence farming, a
factor that fuels the rural-urban drift.  The second major branch of the farming sector is comprised of
state-owned enterprises (vegetable oils, soap, mine ral water, livestock rearing, poultry, fruit and
vegetables) or recently privatised ones (sugar).  Despite being heavily protected on the domestic
market, most of these enterprises are not profitable.
Foodstuffs account for about a fifth of the country's imports.  Tariff protection stands at an
average of 22.9 per cent, above the overall average of 18.3 per cent.  Non-tariff protection is afforded
through the 18 per cent VAT and excise duties on certain imports, as exemptions and reductions apply
to domestic output.   State-owned enterprises in the edible oils, household soap, sugar, coffee and
cocoa industries also enjoy a monopoly over the marketing of imported and domestic products.  ThesePRESS/TPRB/168
Page 9
MOREmeasures attest to the importance of the support accorded to the farming sector by the Gabonese
authorities, despite the high cost to consumers.
The authorities are aware that the country has not benefitted much from State involvement in
the agribusiness sector and are now attempting to withdraw from it by transferring the activities to
private operators.  The government is also trying to stimulate food production so as to reduce the
volume of food imports, and a draft law is now being discussed in the Parliament to that end.
Fisheries
With 800 kilometres of coastline and many inland waterways and rivers, Gabon has enormous
potential in fisheries, which the government hopes to further develop on a sustainable basis.  Sea
fishing is already being practised, including by vessels from the European Union and Japan, under
bilateral agreements.  Inland fishery is practised to a lesser extent and aquaculture is very
underdeveloped. Fish is the population's staple food and fishery could be further developed through
aquaculture, also with a view to exportation.
Forestry
Nurtured by the hot and humid equatorial climate, virgin forest is one of Gabon's major assets
and is owned by the State.  The okoumé species is the one chiefly being exploited.  The extraction of
timber from the forest is expanding rapidly.  Logs are exported mainly to the Chinese and French
markets.  They are subject to a 15 per cent export duty which is waived in the case of processedproducts.  By virtue of its rich flora and fauna, the forest also offers considerable tourism potential
which is now largely underdeveloped.
The forestry companies currently working the forest are subject to specific laws and
regulations which are administered by the Gabonese authorities.  Yet these measures are hardly
effective in practice, owing to regulatory shortcom ings and the lack of resources allocated for the
purposes of enforcing the existing provisions.
Sweeping changes are being contemplated in a draft Code now before the Parliament.  In the
main, they pertain to the introduction of the notion of sustainable forest management, and preferences
in the award of forestry licences to companies that ha ve installed processing facilities.  The authorities
wish to increase the contribution of wood to economic activity by mandating more local processing;in 2000, some 9 per cent of wood exports (in volume terms) were processed.  The Gabonese
authorities are also aware of the need to increase the human resources devoted to administering the
law.
Mining
The resources of the sub-soil are the property of the State, which manages their exploitation.
Oil, Gabon's leading resource since the 1960s, is now facing an uncertain future owing to the natural
exhaustion of the oil fields being exploited.  Gabon hopes to encourage further oil prospecting, but the
easily accessible blocs have already been awarded and operators are now being offered offshore blocs
in deep water.  Operators involved in prospecting may benefit from tax and customs incentives.
Gabon is also encouraging the search for new subsoil resources.  With manganese deposits
already being worked, Gabon is encouraging the search for new deposits.  Accordingly, a new Mining
Code was introduced in 1999 and also provides fiscal and customs incentives.PRESS/TPRB/168
Page 10
MOREIndustry
Gabon has few industrial activities apart from those connected with the processing of raw
materials, in particular agribusiness, the wood processing industries, refining and the manufacture of
construction materials.  The share of industry in GDP  is about 5 per cent.  In a bid to attract new
companies to this sector, Gabon is offering tax incentives under the Investment Charter.
Services
Transportation
Gabon exports almost all of its national output of oil, wood and mining products, and imports
most of its foodstuffs and manufactures.  Therefore, water-borne transport, both inland and maritime,
is a key factor in the country's economic life.  Nevertheless, owing to a range of competitive
inefficiencies, transportation costs and related expenses are higher than in other African countries.
The road and railway networks are largely underdeveloped in Gabon.  The asphalting of
roads, currently around 10 per cent of the total, is a priority under the national investment programme.
The authorities have now awarded a railway concessi on to a private operator with a view to enhancing
the volume and quality of the service on the single available line.
These networks were created to cater to specific domestic needs and do not form part of a
common infrastructure with the CAEMC partner countries.  This is a major shortcoming in thecommon market project as an economic operator located in any one country would find it extremely
difficult to service the other countries.
Air transport is equally crucial for the movement of goods and tourists, but is extremely
costly.  The national operator is now being privatized.
Telecommunications
Some 4 per cent of the population have access to fixed telephone lines and 8 per cent to the
mobile telephone service, and the use of the Internet is rather limited.  This level of teledensity is well
below that appropriate to a country of comparable per capita income.  The underlying reason is the
low level of investment undertaken by the nation al operator in telecommunications infrastructure.
Gabon is attempting to foment the development of communications by privatizing the
national operator, Gabon Telecom.  The process is now under way.  The intention is to transfer a two-
thirds stake to a private operator, with the State retaining the remainder.   Gabon Telecom would keep
its monopoly over fixed-line telephony until 2005.  The mobile telephone market was opened in 2000
and three licences were awarded.
Tourism
The main component of tourism in Gabon is business travel, mainly to Libreville.  Gabon is
striving to develop leisure tourism, especially around the 140 tourist sites and reserves which hold
potential for eco-tourism.  To that end, an Order was issued in 2000 concerning investment in the
sector, providing enterprises with fiscal and customs incentives.
Banking and insuranceGabon has a well-developed private financial sector and provides a range of financial services
to consumers and enterprises.  Yet rural farmers have no access to funding and small and medium-PRESS/TPRB/168
Page 11
MOREsized enterprises face major difficulties in this regard.  The Government grants support to the latter
group, provided that they are Gabonese.
The Central African Banking Commission (COBAC) controls the operating conditions of
lending institutions, oversees the quality of their financial situation and ensures observance of the
rules of the trade.  COBAC gives its approval of the establishments, which must also be approved by
the competent authority in Gabon, the Ministry of Finance.
Outlook
The Gabonese economy is still in transition in 2001.  The authorities intend to continue their
efforts to gain control of public spending and to increase non-oil receipts through more efficient
collection methods so as to ensure surpluses on a sustained basis.  That would enable Gabon to cope,
for the time being at any rate, with the servicing of the public external debt.  In this connection, the
authorities envisage mounting problems over the 2002-2005 period owing to dwindling oil revenueand contracting national oil output.
Gabon's medium-term economic prospects are con tingent primarily on the scale of non-oil
activity, and the authorities have set a 2.5 per cent real annual growth target for such activities.  They
are also remaining optimistic about prospects of new discoveries of oil or other mineral deposits.
To attain the growth target for non-oil activities, the authorities are counting on increased,
more efficient harnessing of forest resources, with a higher degree of processing.  This would be done
on a sustainable basis so as to enable Gabon to reap long-term benefits.  There are also plans to boost
agricultural production capacity and further develop fisheries and tourism.
The competiveness of the existing industries should be improved by the reforms under way or
planned, especially with respect to the fight agai nst corruption and the Labour Code.  The state-owned
enterprises should become profitable through privatization, which would also reduce the expenditures
borne by the State.  Investment in new sectors would also be encouraged by a more hospitable
business climate.  Economic operators would enjoy expanded prospects thanks to the subregional
common market, access to the market of the European Union under the preferential terms of the ACP-
EU Partnership Agreement, and access to the world market through Gabon's participation in themultilateral trading system.
The WTO Secretariat believes that economic reform in Gabon would also stand to gain from
greater participation in the multilateral trading system. Making up for the small number of
notifications would enhance the transparency of th e trade policy regime, and the authorities would
reap the benefits of dialogue with trading partners.  Eliminating the difference between applied andbound tariff levels would remove the inconsistency between regional and multilateral levels of trade
policy and help render the tariff regime more stable.  The Gabonese authorities would also be well
served by WTO rules and disciplines in order to confront protectionist pressures more effectively.
Lastly, the authorities could consider making a stronger commitment on services under the GATS and
its fourth and fifth protocols with a view to stimul ating investment in services.  The aim would be to
provide investors with a business climate in which the basic support services for production and
international trade – transportation and communicati ons, finances and energy – would be available at
competitive prices.PRESS/TPRB/168
Page 12
MORETRADE POLICY REVIEW BODY
GABON
Report by the Government of Gabon – Part III
Gabon and the multilateral trading system
As a founder Member of the WTO, Gabon sets great store by the development of a
flourishing multilateral trading system which is mutu ally beneficial to the community of nations.  The
Gabonese Government resolutely sets its economic policy within this framework, as shown by its
involvement in the work which paved the way for the Marrakesh Agreement Establishing the WTO.
Gabon's ratification of the WTO Agreement requires it to implement its main rules, notably
those on market access, that is to say, the application of the Agreement on Rules of Origin, the
Customs Valuation Agreement, tariff concessions and the Agreement on Preshipment Inspection.
Gabon is, however, also closely following the prepar ation of the agenda for the new round of trade
negotiations in the wake of the setback in Seattle.
Implementation of agreements and problems encountered
Since the entry into force of the Uruguay Round Agreements, Gabon, like the other CAEMC
member countries and Africa in general, has come up against major problems relating to theirimplementation.
(a) Tariff negotiations
Gabon bound all of its tariff lines for both agricultural and non-agricultural products as
indicated in Schedule XVII annexed to the GATT of 1994 at the conclusion of the Uruguay Round in
Marrakesh.  Apart from the exceptions mentioned in the Schedule, tariff bindings on agriculturalproducts therefore stand at 60 per cent and thos e on non-agricultural products at 15 per cent.
This commitment has little chance of being fulfilled, in particular with regard to
non-agricultural products, of which 40 per cent of the tariff lines exceed the bound level of 15 per
cent.  This is the case since these products come under categories 3 and 4 of the Common External
Tariff (CET), the rates of which are set at 20 per cent and 30 per cent respectively by CAEMC.Gabon has no powers as regards the CET;  on the ot her hand, it does comply with the undertaking on
agricultural products, since bound duty rates are 60 per cent whereas the rate actually applied is 30 per
cent.
Consequently, Gabon has had to maintain the temporary surcharge instituted by
Act No. 7/93-UDEAC to provide additional protection for its infant industry.  This cannot, however,continue for much longer.
Pursuant to Article XXVIII of the GATT 1994, Gabon therefore intends to renegotiate tariff
concessions with France, its main trading partner, and to offer a substantial cut in bound duty rates on
agricultural products in exchange for higher tariff bindings on non-agricultural products.  This
solution has the advantage of allowing Gabon to respect its international commitments and remove
the temporary surcharge more easily.PRESS/TPRB/168
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MORE(b) Notification
Gabon has not managed to comply with the notification requirement for national provisions
falling within the scope of WTO Agreements despite the existence of national measures in these
fields.  This situation can be explained by the fact that the government departments concerned have
not yet mastered the notification procedures.
(c) Customs valuation
On 4 April 1999, Gabon notified the WTO Secretariat of the CAEMC (formerly CACEU)
acts transposing into Community law the Agreemen t on the Implementation of Article VII of the
GATT 1994 on the customs valuation of import goods.  Gabon took the opportunity to thank the
WTO Secretariat, on behalf of the other CAEMC members, for its assistance with this transposition
and for the training courses on the Agreement which it had agreed to organize for Gabonese customs
officers.  Although the Agreement should have been implemented on 1 January 2000 (on a delayed
basis of five years from 1994), concern over ensuring the uniform application of the customsregulations in all CAEMC countries has led to its actual implementation being delayed yet further.
(d) Intellectual property
Gabon, along with the other AIPO Member Stat es, signed the Agreement Establishing the
WTO on 15 April 1994 in Marrakesh, and therefore also the Agreement on Trade-Related Aspects of
Intellectual Property Rights (TRIPS).  The TRIPS Agreement establishes rules such as the newminimum standards for the existence and scope of such rights and their effective enforcement, to
mention but two.
Since Member States are required to incorporate these rules into their own legal systems,
Gabon, together with its fellow AIPO partners, immediately embarked upon a major review of the
Bangui Agreement to bring it into line with the TRIPS Agreement.  This work culminated in the
signing of a new agreement by Member States' pl enipotentiaries in Bangui on 24 February 1999.  The
revised agreement will come into force once it has been ratified by 10 of the 15 Member States.
Seven have already done so and there are great hopes that this target will be reached by July 2001.
A Committee made up of representatives of the various government departments concerned
(Justice, Customs, Economic police, Culture, Industry and Foreign Affairs) has been formed to followup the implementation of the TRIPS Agreement and meets regularly in Libreville.
The Gabonese Government, determined to combat violations of intellectual property rights,
has set up a special administrative unit responsible for policing infringement.  The action taken by this
unit in the field are yielding encouraging results.
(e) Sanitary and Phytosanitary Measures (SPS) and Technical Barriers to Trade (TBT)
The lack of a reliable monitoring tool is a matter of the greatest concern to the Gabonese
Government.  The implementation of sanitary and phytosanitary measures, the Agreement on
Technical Barriers to Trade (TBT), the Agreement on Agriculture (ASA) and the Agreement on
Trade-Related Aspects of Intellectual Property Rights (TRIPS) has, in all cases, proved ineffective for
want of operational capabilities.  The Government would like a number of its technical staff to benefit
from the training organized by the Food and Agriculture Organization (FAO) and World Trade
Organization (WTO).PRESS/TPRB/168
Page 14
Gabon consequently wishes to receive further assistance with training and implementation in
relation to the agreements.
Gabon and future negotiations
Having succeeded to the GATT in 1962 and acceded to the WTO in 1994, Gabon is firmly
committed to the multilateral trading system.  With the prospect of embarking upon a fresh round ofnegotiations, Gabon reaffirms the need for a harmonized African position in accordance with the
Ministerial Declarations of Algiers and Cairo and the Libreville Proceedings of the African Ministers
of Trade.
Gabon is particularly anxious that future negotiations should culminate in the following:
- The guarantee of greater access to the markets of developed countries for goods from
developing countries thanks to the effective application of special and differential
treatment;
- the implementation of strategies and capacity-building programmes relating to the
implementation of the agreements and improvement of export capacity;
- the implementation of bolder solutions to provide debt relief for developing countries,
in particular Gabon, which is the only country classified as middle income and, as
such, excluded from debt treatment mechanisms;
- the establishment of a global partnership between the WTO and developing countries
with a view to advancing sustainable development strategies focussed on mankindand the environment, and to eradicating poverty and disease;
- renewed support from the WTO for the European Union policy on African, Caribbean
and Pacific (ACP) countries within the fr amework of the new EU/ACP partnership;
and
- strengthened ties between industrialized and poor countries.
END