GABONKey conditions andchallenges

Table 12023

Population, million

2.4GDP, current US$ billion

20.5

GDP per capita, current US$8414.1

International poverty rate ($2.15)

a2.5
a8.1

a31.2

Lower middle-income poverty rate ($3.65)
Upper middle-income poverty rate ($6.85)
Gini index

a38.0

School enrollment, primary (% gross)b100.6b65.8

Total GHG emissions (mtCO2e)22.5Life expectancy at birth, years

Source: WDI, Macro Poverty Outlook, and official data.
a/ Most recent value (2017), 2017 PPPs.
b/ Most recent WDI value (2021).

Gabon’s economy grew by 2.3 percent in
2023 on the back of sustained oil production, down from 3.0 percent in 2022. Following a coup d’état in August 2023,
an orderly return to an elected government over the planned two-year transition period will be key to avoid risks ofsanctions and adverse impacts on investment and growth. Substantial reforms are needed to boost growth, reduce poverty, restore fiscal stability, andstrengthen governance.

Despite Gabon’s rich natural endowments,
over recent decades low and erratic
growth and insufficient diversification resulted in high unemployment and persistent poverty. Popular discontent aroundgovernance weaknesses and electoral
fraud allegations fueled support for theAugust 2023 coup d’état. A transitional
government was rapidly set up with a twoyear plan for return to elected government.
After six months of sanctions, Gabon wasreintegrated in the Economic Communityof Central African State on March 9, 2024.
Public expectations for the transition arehigh, putting pressure on social spending
and delivery of quick results. The authorities increased civil service hirings, extended fuel subsidies to the electricity utility(SEEG), and reinstated scholarships forsecondary education. These decisions havea fiscal cost in a context of constrained financing capacity. While domestic revenue
mobilization efforts are underway, reliance on volatile oil revenues and tight financing conditions pose risks to the budget. Calibrating spending pressuresagainst realistic revenue mobilization
goals will be key for fiscal sustainability.
The transition could provide an opportunity for renewed reform momentum andimproved institutional controls of publicresources, as well as governance of publicfinances. Promoting access to credit, entrepreneurship, and strengthening social

support to the most vulnerable would
also be crucial for higher and inclusive
growth. A new development plan withthese goals is being prepared. It brings
forward an ambitious program targeting
key areas such as roads, energy, health,and education. However, investments
will need to be prioritized to ensure
its feasibility and fiscal sustainability. A
more detailed focus on jobs is key for inclusive growth and lower wage bill pressures. A successful implementation will
also rely on strong coordination and improved public investment management.

Recent developments
Gabon’s economy grew by an estimated
2.3 percent in 2023, down from 3.0 percent
in 2022. The lower growth was caused byweaker wood and manganese production,amid high fuel costs and railway disruptions caused by landslides. Oil production
grew by 3.7 percent, fueled by new oilfields, low OPEC+ restrictions and globaldemand. Demand-side growth was driven
by public investments, oil and agriculturalexports, and oil investments.
Gabon’s investments in optimizing oilfields and expanding mines and wood
production led to large trade surpluses,
offsetting its strong reliance on food imports. In 2023, although oil, palm oil, andrubber export volumes increased, lower
oil prices, appreciated USD and lower
wood and mining production decreased
exports. Imports remained stable, andthe current account surplus remained

FIGURE 1 Gabon / Growth of real GDP, Real oil GDP andreal non-oil GDP

FIGURE 2 Gabon / Actual and projected poverty rates andreal GDP per capita

Percent change
14121086420-2-4-6-8-102017 2018 2019 2020 2021 2022 2023e 2024f 2025f 2026f

Poverty rate (%)

Oil GDP

Non-Oil GDP

Real GDP per capita (constant million LCU)

40

2.6

35

2.6
2.5

30

2.5

25

2.5

20

2.5

15

2.5
2.4

10

2.4

5

2.4

02.4
2017

Real GDP

Sources: Official government data and World Bank calculations.

2019

2021

1Apr 242025

International poverty rate

Lower middle-income pov. rate

Upper middle-income pov. rate

Real GDP pc

Source: World Bank. Notes: see Table 2.

MPO2023

high but decreased to estimated 28.7 percent of GDP in 2023.
The fiscal deficit increased slightly in
2023 to an estimated 1.0 percent of GDP.
Government revenues benefited fromhigher non-oil receipts and tax expenditure cuts. Public spending increased due
to elections, public works, and the settlement of domestic arrears in late 2023.
Lower oil prices and the removal of fuel subsidies for industrial consumers mitigated the fiscal cost of fuel subsidies.
While efforts are ongoing to avoid theaccumulation of arrears, external arrears
at end-2023 were estimated at CFAF 123
billion (1.0 percent of GDP). Public debtstood at 70.5 percent of GDP (57.4 percent of domestic and external debt, plus
arrears and T-bills).
The Bank of Central African States maintained a tight monetary policy, with policy
rate kept at 5.0 percent after a 175-basis
point increase between late 2021 andMarch 2023. Yet, credit to the private sector
increased by 14.2 percent in September
2023 (y-o-y), driven by oil and publicworks. Inflation decreased from 5.2 percent (y-o-y) in January 2023 to 2.7 percent in October, but food inflation wasat 4.7 percent. While exemptions andprice controls on essential food items
were expanded to alleviate living costs,

households remain affected. Combinedwith static per capita growth, this increased poverty to 35.2 percent in 2023.

OutlookGabon’s recovery should continue, withhigher risks due to recent political developments. An average 2.7 percent
growth is projected in 2024-2026, mainly
coming from non-oil sectors, including
new iron and manganese deposits, timber production, and new oil palm,
biodiesel, and gas industries. Maturingoilfields would gradually reduce oil output from 2025, but exploration projects
could reverse this scenario.
Higher imports in real terms are expected,
driven by infrastructure projects and private investments. With oil exports declining from 2025, the authorities are promoting investments to boost exports of othercommodities, notably manganese, iron,and timber. Current account surpluses
would remain high, supported by highcommodity exports.
Diminishing oil production and prices
would impact fiscal revenues. Also,
higher wage bills, large infrastructure
projects, and social support measures

TABLE 2 Gabon / Macro poverty outlook indicators

would exacerbate spending pressures,
resulting in fiscal deficits (averaging 4.9
percent of GDP in 2024-26, with non-oil
primary deficits of 12.0 percent of nonoil GDP). Primary balances would turnnegative, increasing debt. Without significant fiscal adjustment, these pressures could make the fiscal and debt
situation unsustainable.
Inflation would remain below the 3.0 percent regional convergence criteria. However, the poverty rate should increase to36.9 percent by 2026. Most jobs are in services, which is expected to have insufficient growth. Also, growth is largely driven by capital-intensive extractive industries, which do not create sufficient jobs
and equitable income distribution.
Downside risks include commodity priceshocks, competition from Russian oil in
Asian markets, tighter financing conditions, and impacts of intensifying war in
Ukraine or conflict in the Middle East.
Uncontrolled spending from higher socialpressures or SOE acquisitions could leadto spiraling deficits and debt. While ECCAS’ sanctions were lifted, a delayedtransition could trigger sanctions, hitting
access to regional markets. The political
agenda could limit reforms needed forbetter governance, higher, job-based
growth, and poverty reduction.

(annual percent change unless indicated otherwise)

Real GDP growth, at constant market prices
Private consumption
Government consumption
Gross fixed capital investment
Exports, goods and services
Imports, goods and services

2021
1.5
-1.4
3.2
9.2
-2.0
3.5

2022
3.0
-0.3
3.8
8.3
6.9
8.3

2023e
2.3
3.2
-1.5
-0.5
1.4
-0.9

2024f
3.0
5.6
-4.9
2.4
5.5
4.1

2025f
2.3
2.3
1.83.8
5.3
5.7

2026f
2.8
4.7
-4.8
2.4
4.2
3.2

Real GDP growth, at constant factor prices
Agriculture
Industry
Services

2.9
11.2
3.2
1.4

3.3
9.4
3.2
2.4

2.3
2.1
3.5
1.5

3.0
3.6
2.2
3.3

2.3
5.5
0.0
3.1

2.8
6.6
4.2
1.1

Inflation (consumer price index)

1.1

4.3

3.7

2.4

2.3

2.2

Current account balance (% of GDP)Net foreign direct investment inflow (% of GDP)

30.1
2.1

35.2
4.6

28.7
5.5

29.2
5.4

28.8
5.0

28.4
5.4

Fiscal balance (% of GDP)
Revenues (% of GDP)
Debt (% of GDP)
Primary balance (% of GDP)

-1.8
14.7
65.8
0.9

-0.8
20.4
55.3
1.7

-1.0
22.9
70.5
1.9

-3.8
20.0
73.7
-0.7

-5.9
18.8
79.1
-2.8

-5.0
18.1
81.8
-1.7

2.3
8.2
32.1

2.4
8.5
32.3

2.9
10.0
35.2

3.1
10.1
35.1

3.2
10.7
36.1

3.2
10.9
36.9

4.5
15.9

2.5
16.0

-0.7
14.9

-0.2
13.8

0.1
12.8

0.8
12.1

a,b

International poverty rate ($2.15 in 2017 PPP)a,b
Lower middle-income poverty rate ($3.65 in 2017 PPP)a,b
Upper middle-income poverty rate ($6.85 in 2017 PPP)
GHG emissions growth (mtCO2e)
Energy related GHG emissions (% of total)

Source: World Bank, Poverty & Equity and Macroeconomics, Trade & Investment Global Practices. Emissions data sourced from CAIT and OECD.
Notes: e = estimate, f = forecast.
a/ Calculations based on 2017-EGEP. Actual data: 2017. Nowcast: 2018-2023. Forecasts are from 2024 to 2026.
b/ Projections using microsimulation methodology.
MPO2Apr 24