IMF Executive Board Concludes 2024 Article IV Consultation with Gabon
IMF News, May 28, 2024
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- Published: May 28, 2024
Overview
- On May 24, 2024, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with Gabon.
- Gabon’s post-pandemic recovery held up well despite recent shocks; the economy hit a soft patch in 2023 because of logistics disruptions, political uncertainty, and high fuel prices for businesses.
- Growth is set to resume toward potential growth of around 3 percent in 2024 as shocks dissipate.
- Inflation has receded to below the 3 percent regional ceiling by the BEAC and should remain within target in the absence of further shocks.
- Robust oil prices in the last few years have supported the external position.
- Fiscal imbalances widened significantly in 2022–23: large nonoil deficits led to a rapid accumulation of arrears, pushed public debt to an estimated 70½ percent of GDP (above the CEMAC ceiling), and weighed on reserve accumulation.
- Longer-term headwinds: prospect of gradually declining oil wealth, moderate diversification away from oil, projected slowdown of growth to around 2⅔ percent over the long term, and gradually dwindling current account surpluses.
- The outlook hinges on authorities’ ability to: correct the fiscal position, make progress on transparency and diversification reforms, and address liquidity and sustainability risks from fiscal imbalances.
Executive Board Assessment
- Directors agreed with the thrust of the staff appraisal and welcomed Gabon’s rebound in growth and decline in inflation following multiple domestic shocks.
- Key concerns and priorities highlighted by Directors:
- The currently expansive fiscal policy stance and long‑standing structural and governance weaknesses, magnified by external risks, pose significant challenges.
- Urgency of decisive fiscal consolidation to ensure fiscal sustainability while safeguarding large social and development needs.
- Improve spending efficiency and increase fiscal space through revenue measures.
- Adoption of a strong fiscal framework to guide policies towards sustainability.
- Firm commitment to good public financial management practices is critical.
- Governance, transparency, and fiscal reporting:
- Commended consolidation of the Treasury Single Account and the digitalization of government services.
- Encouraged addressing remaining gaps in governance frameworks for public enterprises, debt and investment management, and wage bill and civil service management.
- Called for comprehensive accounting and reporting of public sector fiscal accounts, assets and liabilities, disclosure of mining contracts, and better gauging of the mining sector’s potential revenue contribution.
- Diversification and private sector:
- Economic diversification is essential to improve living standards.
- Cost‑effective cross‑cutting initiatives: strengthen governance, improve business environment, ensure reliability of energy and transport infrastructure to support private sector growth.
- Financial sector and vulnerabilities:
- Encourage strengthening financial sector soundness, reduce risks from the bank‑sovereign nexus, repay government arrears, and address AML/CFT framework deficiencies.
- Prioritize initiatives to address climate‑related vulnerabilities.
- Statistics and capacity development:
- Need to improve timeliness, coverage, and accuracy of economic statistics.
- Encouraged continued engagement with the Fund, including through capacity development.
- Administrative note:
- Next Article IV consultation with Gabon is expected to be held on the standard 12‑month cycle.
Selected Economic Indicators, 2022–25 (key figures preserved exactly as in source)
- Real GDP (annual percentage change): 2022: 3.0; 2023: 2.3; 2024: 2.9; 2025: 2.7
- Real GDP — Oil: 2022: 2.5; 2023: 1.7; 2024: -0.8
- Real GDP — Non-oil: 2022: 3.1; 2023: 2.2; 2024: 3.3
- Real GDP per capita: 2022: 1.8; 2023: 0.0; 2024: 0.7; 2025: 0.5
- GDP deflator: 2022: 13.6; 2023: -7.2; 2024: -0.2; 2025: -1.8
- Consumer prices (average): 2022: 4.3; 2023: 3.6; 2024: 2.1
- Consumer prices (end of period): 2022: 5.4
- Terms of trade: 2022: 12.3; 2023: -21.0; 2024: 10.6; 2025: -1.7
- Real effective exchange rate: 2022: -0.7
- Gross national savings (percent of GDP): 2022: 40.6; 2023: 38.6; 2024: 35.9; 2025: 35.7
- Gross domestic investment (percent of GDP): 2022: 30.0; 2023: 34.2; 2024: 32.0; 2025: 32.9
- Public investment (percent of GDP): 2022: 3.8; 2023: 3.9
- Broad money (annual percentage change): 2022: 15.2; 2023: 9.7; 2024: 0.9
- Credit to the economy (annual percentage change): 2022: 15.1; 2023: 16.4; 2024: 8.2; 2025: 4.7
- Total public debt (percent of GDP): 2022: 63.7; 2023: 70.5; 2024: 73.1; 2025: 78.9
- Total public debt (percent of non-oil GDP): 2022: 113.2; 2023: 113.0; 2024: 115.5; 2025: 120.0
- Overall fiscal balance (percent of GDP): 2022: -4.2; 2023: -6.4
- Non-oil primary balance (percent of non-oil GDP): 2022: -14.1; 2023: -14.3; 2024: -15.0; 2025: -14.9
- Government revenues (percent of GDP): 2022: 18.4; 2023: 19.9; 2024: 18.5; 2025: 17.5
- Government expenditure (percent of GDP): 2022: 19.1; 2023: 21.7; 2024: 23.0; 2025: 23.9
- Current account (percent of GDP): 2022: 10.7; 2023: 4.4; 2024: 2.8
- Exports of goods and services (percent of GDP): 2022: 45.2; 2023: 41.1; 2024: 40.5; 2025: 38.7
- Imports of goods and services (percent of GDP): 2022: 27.1; 2023: 30.4; 2024: 30.5; 2025: 30.3
- External public debt (percent of GDP): 2022: 34.5; 2023: 34.1; 2024: 30.2; 2025: 26.7
- Gross international reserves (billions of US Dollars): 2022: 1.4; 2023: 1.0
- Gross international reserves (in months of next year's imports): 2022: 1.9
- Nominal GDP (billions of CFA Francs): 2022: 13,118; 2023: 12,447; 2024: 12,782; 2025: 12,893
- Nominal GDP per capita (US Dollars): 2022: 9,752; 2023: 9,290; 2024: 9,308; 2025: 9,148
- Nominal non-oil GDP (billions of CFA Francs): 2022: 7,385; 2023: 7,761; 2024: 8,093; 2025: 8,474
- CFA Franc per US Dollars (average): 2022: 622.4; 2023: 606.5
- Crude oil price (Brent, US Dollars per barrel): 2022: 99.0; 2023: 82.3; 2024: 80.6; 2025: 75.6
Policy recommendations and priorities emphasized by Directors (enumerated)
- Undertake decisive fiscal consolidation while protecting social and development spending.
- Improve spending efficiency and increase fiscal space through revenue measures.
- Adopt a strong fiscal framework to guide policies toward medium‑term sustainability.
- Strengthen public financial management practices, including consolidation of the Treasury Single Account and digitalization of government services.
- Address governance gaps for public enterprises, debt and investment management, and wage bill and civil service management.
- Improve transparency: initiate comprehensive accounting and reporting of public sector fiscal accounts, assets and liabilities; disclose mining contracts; better assess the mining sector’s revenue potential.
- Advance economic diversification through governance reforms, improved business environment, and reliable energy and transport infrastructure.
- Strengthen financial sector soundness: reduce bank‑sovereign nexus risks, repay government arrears, and fix AML/CFT deficiencies.
- Prioritize actions to address climate‑related vulnerabilities.
- Improve timeliness, coverage, and accuracy of economic statistics.
- Continue engagement with the Fund, including capacity development support.
IMF Communications Department, Press Release No. 24/187 — IMF Executive Board concluded the Article IV consultation with Gabon on May 24, 2024.