Gabon’s public debt set to reach 15 billion dollars by 2025

Gabon’s public debt is projected to escalate to approximately 15 billion dollars by 2025, marking an unprecedented peak for the CEMAC economy. This figure, revealed after a period characterized by treasury strains and increased reliance on regional markets, underscores an upward trajectory observed over several years. Libreville now faces increasingly constrained budgetary choices, particularly as oil revenues remain the pivotal factor in maintaining public financial stability.

Questioning Gabon’s debt sustainability path

When measured against the national wealth, this financial obligation now approaches the Community Economic and Monetary Community of Central Africa (CEMAC) threshold of 70% of the gross domestic product. Despite being the fifth-largest economy in the sub-region, Gabon had previously cultivated a reputation for prudent macroeconomic management throughout the 2000s. This situation reversed due to the cumulative impact of the 2014 crude oil price collapse, the global health crisis, and the subsequent expansion of domestic debt service held by local banks and on the public securities market of the Bank of Central African States (BEAC).

The current debt stock comprises a predominantly external component, notably backed by eurobonds issued between 2013 and 2020, alongside a domestic debt whose weight continues to grow. Repeated issuances of Treasury bills and bonds on the sub-regional market have helped bridge financial gaps, but at the cost of interest rates that burden the operational budget. In essence, each new fundraising initiative increases the portfolio’s average cost.

Navigating delicate fiscal choices under Oligui Nguema’s transition

Since assuming power in August 2023, General Brice Clotaire Oligui Nguema has made the restoration of budgetary balance a declared cornerstone of his economic agenda. The Committee for the Transition and Restoration of Institutions (CTRI) has announced several debt audits, specifically targeting accumulated domestic payments to state suppliers and local authorities. The primary objective is to identify contentious claims, reschedule those deemed legitimate, and thereby free up treasury resources for public investment.

However, this endeavor remains constrained by the existing repayment schedule. Gabon must honor several eurobond maturities in the coming years, including a dollar-denominated bond nearing maturity, whose refinancing already presents a significant challenge. Libreville tested the international market in 2024 with a liability management operation partially linked to a debt-for-nature conversion mechanism, yet this did not fundamentally resolve the underlying financial equation. Nevertheless, regaining credibility with investors necessitates clear visibility on the finance law and a resumption of formal dialogue with the International Monetary Fund (IMF).

Oil, manganese, and timber: Gabon’s key revenue drivers

Gabon’s capacity to manage this substantial burden is intrinsically linked to the performance of its export sectors. Oil remains the bedrock of budgetary revenues, with production hovering around 200,000 barrels per day, experiencing a slight structural decline. Manganese, for which Libreville is a leading global producer through the Compagnie minière de l’Ogooué (Comilog), a subsidiary of the French group Eramet, contributes an increasing share, bolstered by Asian demand. The processed timber sector, anchored by the Nkok special economic zone, completes this vital revenue trio.

Furthermore, authorities are banking on an acceleration of road and energy infrastructure projects to bolster non-oil growth. The Transgabonaise, a flagship project, along with several partnerships in hydroelectricity, are expected to drive activity beyond an annual rate of 3%, a crucial condition for stabilizing the debt-to-GDP ratio. Without this revitalization, Gabon risks further deterioration of its sovereign rating, following multiple downgrades by international agencies in recent years.

The budgetary roadmap presented for 2026 will therefore need to reconcile expenditure discipline, mobilization of non-fiscal revenues, and targeted renegotiation of the debt stock. This represents a demanding balance, yet it is critical for the nation’s credibility in both regional and international markets.