GABON Gb 07:GABON Gb 07 17/04/07 14:48 Page 269
Total Page:16
File Type:pdf, Size:1020Kb
GABON gb 07:GABON gb 07 17/04/07 14:48 Page 269 Gabon Libreville key figures • Land area, thousands of km 2 268 • Population, thousands (2006) 1 406 • GDP per capita, $ PPP valuation (2006) 7 668 • Life expectancy (2006) 53.6 • Illiteracy rate (2006) … GABON gb 07:GABON gb 07 17/04/07 14:48 Page 270 Gabon GABON gb 07:GABON gb 07 17/04/07 14:48 Page 271 THE 2005 PRESIDENTIAL ELECTION WAS a contest sources of income. Moreover, despite the government’s between opposition parties and a “presidential majority” promises that budgetary indiscipline linked to the 2005 coalition of about 40 other parties and groups backing presidential election would not be repeated, President Omar Bongo Ondimba for another seven- parliamentary elections in late 2006 are also expected year term. Bongo was declared by the constitutional to have been accompanied by Gabon should diversify court to have won re-election with about 80 per cent excessive spending. Inflation, its economy and prepare of the votes cast. which fell back in 2005, rose in for the after-oil era pursuing 2006 to 1.9 per cent, mainly institutional reforms to Despite shrinking oil reserves and declining owing to a higher wage bill for improve the investment production, oil was still Gabon’s main natural resource government workers. climate, governance, in 2005, providing more than half its GDP, 80 per and eradicate poverty. cent of export earnings and 63 per cent of tax revenue. Many institutional reforms Without new discoveries, however, the country will were introduced in 2005 affecting business conditions, have to prepare for the post-oil era by creating better the civil service and the judiciary, as well as restructuring economic and institutional conditions to enable and reorganising the state sector and improving diversification of the economy and generation of new governance – the fourth pillar of the full poverty 271 Figure 1 - Real GDP Growth and Per Capita GDP ($ PPP at current prices) I Gabon - GDP Per Capita (PPP in US $) I Central Africa - GDP Per Capita (PPP in US $) I Africa - GDP Per Capita (PPP in US $) ——— Gabon - Real GDP Growth (%) Real GDP Growth (percentage) Per Capita GDP ($ PPP) 4 8000 7000 3 6000 2 5000 1 4000 0 3000 -1 2000 -2 1000 -3 0 2000 2001 2002 2003 2004 2005 2006(e) 2007(p) 2008(p) Source: IMF and local authorities’ data; estimates (e) and projections (p) based on authors’ calculations. http:// dx.doi.org/10.1787/546801745412 © AfDB/OECD 2007 African Economic Outlook GABON gb 07:GABON gb 07 17/04/07 14:48 Page 272 Gabon reduction and growth strategy paper (PRGSP), sub-Saharan oil producer after Nigeria and Angola. implementation of which began in 2006. A national Mining provided 2.5 per cent of GDP (up from 1.9 per commission to combat illegal enrichment was set up, cent in 2004). The country is also Africa’s second- and top officials and government members have been largest wood exporter after Cameroon, though the asked to declare their personal assets. Like the other wood and forestry products sector accounted for only Central African Economic and Monetary Community 2.5 per cent of GDP in 2005. (CEMAC) countries, Gabon has joined the Extractive Industries Transparency Initiative (EITI), requiring it Oil continues to dominate the country’s growth to use its oil revenue (especially windfall profits due to structure despite falling crude production and reserves, higher world prices) to reform public finances and but investment in exploration that could stem this balance its budget. To this end, some 170 billion CFA decline barely increased in 2005 (388.3 billion CFA francs in 2005 windfall profits went to investment in francs, compared with 387.1 billion in 2004) and was selected sectors, to poverty-reduction programmes, expected to drop to 360 billion in 2006. Exploration clearing domestic debt arrears and consolidating the and production-sharing contracts since 1997 have treasury’s position in relation to the central bank. The included royalties of 10-20 per cent of the oil sold. The government also began drafting a national good producer gets about half of the remainder, with the rest governance programme in 2004, with support from the going to the government. After rising slightly in 2003 African Development Bank (AfDB) and the United (6.9 per cent) and 2004 (0.3 per cent), production Nations Development Programme (UNDP), and this resumed the decline it began in 2001 and 2002, falling is expected to be ready by late 2006. 1.3 per cent in 2005 and 3.1 per cent in 2006 due to ageing wells and antiquated equipment. The decline 272 is likely to continue unless more effort is devoted to Recent Economic Developments exploration and new discoveries made. The average price of Gabonese crude has risen in the last few years, The economy recorded relatively strong growth in from $27.8 per barrel (2003) to $35.75 (2004) to 2005 and inflation fell by 0.2 per cent. Despite a 1.3 per $50.49 (2005) and an expected $60 in 2006. The cent shrinkage of the oil sector, real GDP increased 3 per steady increase, due to higher world prices, certainly cent, well above forecasts and the 2004 figure of 1.4 per boosts government revenue but does not get the country cent, owing to the strong expansion of the non-oil out of danger. A combination of structural shocks sector (4.3 per cent of GDP), especially mining, wood (falling national production) and a drop in world oil and services. In 2006, however, GDP is expected to prices would seriously harm the economy, which is increase only 2.1 per cent, with inflation rising to too dependent on oil for tax and customs revenue. 1.9 per cent. Higher world oil prices boosted the After deduction of the 750 000 tonnes delivered to the balance-of-payments surplus to 16.7 per cent of GDP national oil refinery (Société gabonaise de raffinage – in 2005, allowing a further reduction (4.4 per cent) in Sogara), exports are falling in step with production external debt that brought the stock of such debt down (down 1.9 per cent in 2005 and 2.7 per cent in 2006). to 39 per cent of GDP. The overall commitment-basis budget surplus amounted to 9.4 per cent of GDP, and The government joined EITI to make its handling the 2006 budget calls for reduction of the non-oil fiscal of extractive revenue, mainly from oil, more transparent, deficit to 7.8 per cent (from 12 per cent in 2005). to assess the fiscal and economic impact of the windfall profits of the previous three years and to try to give more The country’s economy depends heavily on credibility to the process by which oil revenue is collected extractive industries. The oil sector alone accounted for and transferred to the national budget. The first EITI 50.7 per cent of GDP in 2005. Recoverable proven report, covering 2004, done by independent consultants reserves of some 2 billion barrels and daily output of and published in 2005, was considered incomplete by around 270 000 barrels made Gabon the third-largest stakeholders because it did not include profit oil in African Economic Outlook © AfDB/OECD 2007 GABON gb 07:GABON gb 07 17/04/07 14:48 Page 273 Gabon Figure 2 - GDP by Sector in 2005 (percentage) Government services Forestry 6.6% 1.3% Other services 27.2% 50.7% Petroleum 3.6% 1.2% 1.7% Agriculture, livestock and fishing 5.2% 2.5% Water and electricity Manufacturing Mining Construction Source: Authors’ estimates based on local authorities’ data. http:// dx.doi.org/10.1787/884002681682 the 2004 revenues. Profit oil is the crude oil the country also has niobium, a very high value-added government gets under production-sharing agreements, mineral used in making special steels and heavy-duty and it accounts for at least half of all state revenue from alloys used in aeronautics. Once investments are the oil sector. The government promised that profit oil complete in manganese, niobium, phosphates and the would be included in the 2006 revenue report. Despite huge Belinga iron deposits, the mining licence for the budgetary indiscipline in 2005 due to the which was granted in 2005 to two Chinese firms that presidential election, the government managed to save plan to invest some $3 billion, the mining industry about half its 2005 windfall profits, since higher world should generate $300-400 million a year. oil prices boosted oil revenue about 40 per cent in 2005 even though production stagnated. With 20 million hectares of mostly-untapped forests 273 containing about 60 marketable species, the forestry Expansion of mining could be an alternative to oil, and wood industries can also contribute to the economy, especially as non-oil extractive industries showed the as shown by their 2005 growth performance of 5.6 per best growth performance (11.9 per cent) in 2005, cent. Their share of GDP is still small (2.5 per cent in though their GDP contribution is still only 2.5 per cent. 2005), but forestry and wood employ more than a The Moanda manganese deposits (in Haut-Ogooué fifth of the working population, and the sector could province), mined since the 1960s by the Compagnie boost its output if its regulation were changed to make minière de l’Ogooué (Comilog), a subsidiary of the it more efficient and reduce management costs. The French metallurgical group Eramet, could be a motor forestry law needs to be revised to encourage local and of such growth.