The Gabonese public debt is expected to reach a record high of $15 billion by 2025, posing significant challenges for the country’s economic stability. The surge in debt comes as tensions over trésorerie and increased reliance on regional markets continue to affect the CEMAC economy.
Debt Trajectory Raises Sustainability Concerns
When viewed in relation to the nation’s wealth, the burden is becoming increasingly unsustainable at 70% of the country’s Gross Domestic Product (GDP) set by the Economic Community of Central African States (ECCAS).
The Gabonese economy had previously maintained a prudent management of macroeconomic ratios during the early 2000s. However, this was overturned by the sharp decline in oil prices in 2014, followed by the health crisis and the growth of domestic debt held within local banks and on regional bond markets.
The current stock combines an external major component, largely backed by eurobonds issued between 2013 and 2020, with a growing domestic debt component. Regular government bond issuances have helped cover short-term expenses but at the cost of rising interest rates which impact the budget’s operational costs.
Transition Oligui Nguema Faces Fiscal Arbitrage Challenges
Since taking office in August 2023, General Brice Clotaire Oligui Nguema has prioritized restoring fiscal balance as part of his economic agenda. Several audits have been announced on internal debt payments to identify litigious claims and validate authentic ones, with the aim of freeing up funds for public investment.
Despite these efforts, the country remains constrained by its remittance schedule, including several eurobond repayments due in the coming years, one of which is a dollar-denominated title that poses significant refinancing challenges.
Petroleum, Manganese, and Timber: Levers for Revenue
The Gabon’s ability to absorb this burden depends largely on the performance of its export sectors. Oil remains the mainstay of government revenue, with daily production ranging around 200,000 barrels per day, in a slightly declining trend.
Manganese, particularly through the Compagnie minière de l’Ogooué (Comilog), a subsidiary of Eramet, contributes significantly to the country’s coffers. The timber industry, based on the Nkok Economic Zone Special Area, rounds out this export mix.
The government is also focusing on accelerating infrastructure projects, including roads and energy initiatives, to support non-oil driven growth. The Transgabon project and partnerships in hydroelectricity are key drivers of this effort.
Failure to meet these targets risks further deteriorating the country’s credit rating, following several consecutive downgrades from international agencies.
Looking Further Ahead
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