Economy of Gabon

Economy of Gabon

Libreville is the capital and financial center of Gabon
Currency 1 Central African CFA franc (XAF) = 100 centimes
calendar year
Statistics
GDP $22.54 billion (2010 est.)
GDP growth
 5.4% (2010 est.)
GDP per capita
 $14,600 (2010 est.)
GDP by sector
 agriculture: 4.5%; industry: 62.7%; services: 32.8% (2010 est.)
-1.3% (2010 est.)
Labour force
 712,000 (2010 est.)
Labour force by occupation
 agriculture: 60%; industry: 15%; services: 25% (2000 est.)
Unemployment 27% (2012 est.)
Main industries
 petroleum extraction and refining; manganese, gold; chemicals, ship repair, food and beverages, textiles, lumbering and plywood, cement
156th[1]
External
Exports $6.803 billion (2010 est.)
Export goods
 crude oil 70%, timber, manganese, uranium
Main export partners
  United States 15.1%
 China 13.7%
 Hong Kong 11.3%
 South Africa 8.6%
 Indonesia 7.1%
 Canada 6.2% (2013 est.)[2]
Imports $2.433 billion (2010 est.)
Import goods
 machinery and equipment, foodstuffs, chemicals, construction materials
Main import partners
  France 21.8%
 Cameroon 16.2%
 Belgium 10.1%
 China 9.6%
 United States 5.5%
 Netherlands 5.1% (2013 est.)[3]
$2.374 billion (31 December 2010 est.)
Public finances
25.8% of GDP (2010 est.)
Revenues $3.557 billion (2010 est.)
Expenses $2.945 billion (2010 est.)
Economic aid recipient: $331 million (1995)
BB- (Domestic)
BB- (Foreign)
BBB- (T&C Assessment)
(Standard & Poor's)[4]
Foreign reserves
 $2.602 billion (31 December 2010 est.)
Main data source: CIA World Fact Book
All values, unless otherwise stated, are in US dollars.

Gabon enjoys a per capita income four times that of most nations of sub-Saharan Africa, its reliance on resource extraction industry releasing much of the population from extreme poverty.

Resources

Gabon depended on timber and manganese until oil was discovered offshore in the early 1970s. The oil sector now accounts for 50% of GDP and 80% of exports. Although there have been recent offshore finds,[5][6] oil production is now declining from its peak of 370,000 barrels per day (59,000 m3/d) in 1997, and periods of low oil prices have had a negative impact on government revenues and the economy. In 2012 there were six active oil rigs in Gabon.[7] Public expenditures from the years of significant oil revenues have not been spent well.

The government announced in 2012 that it would reassess exactly how much iron ore the Belinga site contains before awarding the concession to a mining company, most likely to be China’s CMEC, which temporarily secured the rights to the ore in 2007.[8]

Financial problems

Overspending on the Trans-Gabon (Transgabonais) Railway, the oil price collapse of 1986, and the franc CFA devaluation of 1994 have caused debt problems. Gabon has earned a poor reputation with the Paris Club and the International Monetary Fund (IMF) for management of its debt and revenues. IMF missions (related to the now lapsed EFF program) have criticized the government for overspending on off-budget items (in good years and bad), over-borrowing from the Central Bank, and slipping on the schedule for privatization and administrative reform.

Gabon's oil revenues have given it a per capita GDP of more than $10,000, unusually high for the region.[9] On the other hand, a skewed income distribution and poor social indicators are evident. The economy is highly dependent on extraction of abundant primary materials. After oil, timber and manganese mining are the other major sectors. Gabon continues to face fluctuating prices for its oil, timber, manganese, and uranium exports. Foreign and Gabonese observers have consistently lamented the lack of transformation of primary materials in the Gabonese economy. Various factors have so far stymied more diversification: a small market of 1 million people, dependence on French imports, inability to capitalize on regional markets, lack of entrepreneurial zeal among the Gabonese, and the fairly regular stream of oil "rent". The small processing and service sectors are largely dominated by just a few prominent local investors.

In 1992, Gabon failed to settle arrears on its bilateral debt, leading to a cancellation of rescheduling agreements with official and private creditors. Devaluation of its CFA franc by 50% on 12 January 1994 sparked a one-time inflationary surge, to 35%; the rate dropped to 6% in 1996. The IMF provided a one-year standby arrangement in 1994–1995 and a three-year Extended Fund Facility (EFF) at near-commercial rates beginning in late 1995. Those agreements mandate progress in privatization and fiscal discipline. France provided additional financial support in January 1997 after Gabon had met IMF targets for mid-1996. In 1997, an IMF mission to Gabon criticized the government for overspending on off-budget items, over-borrowing from the central bank, and slipping on its schedule for privatization and administrative reform. The rebound of oil prices in 1999 helped growth, but drops in production hampered Gabon from fully realizing potential gains.

Animal husbandry

Animal husbandry is limited by the presence of the tsetse fly, though tsetse-resistant cattle have recently been imported from Senegal to a cattle project. In 2005 there were an estimated 212,000 hogs, 195,000 sheep, 90,000 goats, 35,000 head of cattle, and 3.1 million chickens. In an effort to reduce Gabon’s reliance on meat imports, the government set aside 200,000 hectares (490,000 acres) in Gabon’s unpopulated Savannah region for three ranches at Ngounie, Nyanga, and Lekabi. Currently, however, frozen imports are the most important source of beef, costing four times less than locally produced beef. Poultry production satisfies about one-half of Gabon’s consumption demand. Typical annual production of poultry amounts to 3,600 tons.

Fishing

While there have been recent improvements in the fishing industry, it is still relatively undeveloped. Traditional fishing accounts for two-thirds of total catch. The waters off the Gabonese coast contain large quantities of fish. Gabonese waters are estimated to be able to support an annual catch of 15,000 tons of tuna and 12,000 tons of sardines. The fishing fleet was formerly based chiefly in Libreville. A new fishing port was built at Port-Gentil in 1979, which is now the center of operations for the industrial fleet. Plans for a cannery, fish-meal factory, and refrigerated storage facilities are underway. The total catch in 2003 was 44,855 tons, 80 percent from the Atlantic. By international agreement and Gabonese law, an exclusive economic zone extends 200 miles (320 km) off the coast, which prohibits any foreign company to fish in this zone without governmental authorization. However, since Gabon has no patrol boats, foreign trawlers (especially French and Spanish) often illegally capture tuna in Gabonese waters.

Industry

Gabon’s industry is centered on petroleum, manganese mining, and timber processing. Most industrial establishments are located near Libreville and Port-Gentil. Virtually all industrial enterprises were established with government subsidies in the oil boom years of the 1970s. Timber-related concerns include five veneer plants and a large 50-year-old plywood factory in Port-Gentil, along with two other small plywood factories. Other industries include textile plants, cement factories, chemical plants, breweries, shipyards, and cigarette factories. Gabonese manufacturing is highly dependent on foreign inputs, and import costs rose significantly in 1994 when the CFA franc was devalued. Increased costs and oversized capacity have made the manufacturing sector less competitive and it mainly supplies the domestic market. The government has taken steps to privatize parastatal enterprises.

Because the Gabonese economy is dependent upon oil (crude oil accounts for over 80% of the country’s exports, 43% of GDP, and 65% of state revenue), it is subject to worldwide price fluctuations. Gabon is sub-Saharan Africa’s third-largest crude oil producer and exporter, although there are concerns that proven reserves are declining and production has declined as well. Thus the country has taken steps to diversify the economy, and to engage in further petroleum exploration. The country produced 240,000 barrels (38,000 m3) of oil per day in 2014, a decrease of 35% from the 1997 peak. Gabon’s proven oil reserves were estimated at 2.0 billion barrels (320×10^6 m3) in 2015, and its proven natural gas reserves were estimated at 1.0 trillion cubic feet (28 km3).

The Sogara oil refinery at Port-Gentil is the sole refinery in Gabon, built in 1968 by a consortium that included Total, Shell, Mobil, Texaco, Petrofina and Agip. Sogara (Societe Gabonaise de Raffinage) is owned by the government of Gabon (25%), Total (43.8%), Shell (17%), and Agip (2.5%).[10] In 2012 Gabon signed an agreement with Samsung for the construction of a new refinery at Port-Gentil.[11]

Statistics

GDP: purchasing power parity - $21.44 billion (2008 est.)

GDP - real growth rate: 3.6% (2008 est.)

GDP - per capita: purchasing power parity - $14,400 (2008 est.)

GDP - composition by sector:
agriculture: 5.7%
industry: 57.2%
services: 37% (2008 est.)

Population below poverty line: NA%

Household income or consumption by percentage share:
lowest 10%: NA%
highest 10%: NA%

Inflation rate (consumer prices): 5% (2008 est.)

Labour force: 592,000 (2008 est.)

Labour force - by occupation: agriculture 60%, services and government 25%, industry and commerce 15% (2000 est.)

Unemployment rate: 21% (2006 est.)

Budget:
revenues: $4.46 billion
expenditures: $2.75 billion (2008 est.)

Industries: food and beverage; textile; lumbering and plywood; cement; petroleum extraction and refining; manganese, uranium, and gold mining; chemical production; ship repair

Industrial production growth rate: 1.5% (2008)

Oil - production 244,000 bbl/d (38,800 m3/d) (2007 est.)

Oil - consumption 13,170 bbl/d (2,094 m3/d) (2007 est.)

Oil - exports 255,000 bbl/d (40,500 m3/d) (2005 est.)

Oil - imports 2,485 bbl/d (395.1 m3/d) (2005 est.)

Oil - proven reserves 2 billion barrels (320×10^6 m3) (1 January 2008 est.)

Natural gas - production 100 million cu m (2006 est.)

Natural gas - consumption 100 million cu m (2006 est.)

Natural gas - exports 0 cu m (2007 est.)

Natural gas - imports 0 cu m (2007 est.)

Natural gas - proven reserves 28.32 billion cu m (1 January 2008 est.)

Electricity - production: 1.671 TWh (2006 est.)

Electricity - production by source:
fossil fuel: 27.8%
hydro: 72.2%
nuclear: 0%
other: 0% (1998)

Electricity - consumption: 1.365 GWh (2006 est.)

Electricity - exports: 0 kWh (2006 est.)

Electricity - imports: 0 kWh (1998)

Agriculture - products: cocoa, coffee, sugar, palm oil, rubber; cattle; okoume (a tropical hardwood); fish

Current account - balance $591 million (2010 est.)

Currency: 1 Communauté financière africaine franc (CFAF) = 100 centimes

Exchange rates: Communauté financière africaine francs (CFAF) per US$1 – 507.71 (2010), 472.19 (2009), 447.81 (2008), 481.83 (2007), 522.89 (2006), 647.25 (January 2000), 615.70 (1999), 589.95 (1998), 583.67 (1997), 511.55 (1996), 499.15 (1995)
note: since 1 January 1999, the CFAF is pegged to the euro at a rate of 655.957 CFA francs per euro

See also

References

  1. ↑ "Doing Business in Gabon 2012". World Bank. Retrieved 21 November 2011.
  2. ↑ "Export Partners of Gabon". CIA World Factbook. 2013. Retrieved 2015-05-11.
  3. ↑ "Import Partners of Gabon". CIA World Factbook. 2013. Retrieved 2015-05-11.
  4. ↑ "Sovereigns rating list". Standard & Poor's. Retrieved 26 May 2011.
  5. ↑ Pura Vida Energy (March 6, 2013). "20.0 MMBO CONTINGENT RESOURCE AT LOBA M 1 DISCOVERY OFFSHORE GABON, WEST AFRICA".
  6. ↑ "Gabon: FirstAfrica completes offshore EOV development drilling program". September 9, 2006.
  7. ↑ Geological Survey (2015). Minerals Yearbook - Area Reports; International Review: 2012 Africa and the Middle East. Government Printing Office. ISBN 1411336771 – via Google Books.
  8. ↑ Reuters, "Gabon's Belinga iron-ore deal to be awarded as late as 2014", Mining Weekly (30 August 2012)
  9. ↑ Report for Selected Countries and Subjects
  10. ↑ "Oil Refining in Gabon". MBendi Information Services. 29 August 2016.
  11. ↑ "Samsung will build a replacement oil refinery". Economist. June 21, 2012.
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