Gabon is a historically stable country located in a volatile region of the world and has significant economic advantages: a small population (roughly 1.8 million) with many well-educated elites, an abundance of natural resources, and a strategic location along the Gulf of Guinea. After taking office in 2009, President Ali Bongo Ondimba introduced reforms to diversify Gabon’s economy away from oil and from traditional investment partners (mainly France), and to position Gabon as an emerging economy. In his “Emerging Gabon” strategic plan, he laid out a vision for sustainable development by 2025 through creating domestic industrial capacity to process primary materials and by becoming a regional leader in service industries, including financial services, ICT, education, and healthcare. Gabon is also promoting foreign investment across a range of sectors, particularly in the oil and gas, infrastructure, timber, ecotourism, and mining sectors. Despite these efforts, Gabon’s economy remains dependent on revenue generated by the exportation of hydrocarbons. Gabon’s commercial ties with France remain very strong, but the government continues to seek to diversify its sources by courting investors from the rest of the world.
Although Gabon is taking steps towards making the country a more attractive destination for foreign investment, it remains a difficult place to do business. Foreign firms are active in the country, particularly in the extractive industries, but the difficulty involved in establishing a new business and the time it takes many new entrants to finalize deals are impediments to increased U.S. private sector investment. Although the Gabonese government is taking a more active role to ensure transparency in extractive industries, investors are still waiting for key reforms to be established in law and in practice. Gabon enacted a new mining code in 2015 and is currently revising its 2014 hydrocarbon code. A Special Economic Zone (SEZ) located at Nkok became operational in 2014. Gabon is making progress towards rejoining the Extractive Industries Transparency Initiative (EITI) after it failed to submit reports required to continue along the path to membership in 2013. In 2015, Gabon approved an action plan to renew its membership and appointed a president of the new Gabon EITI committee that will implement the plan. Increased investment is constrained due to limited bureaucratic capacity, unclear lines of decision-making authority, a lack of a clearly-established and consistent process for companies to enter the market, lengthy bureaucratic delays, high production costs, a small domestic market, rigid labor laws, limited and poor infrastructure, a cumbersome judicial system, and inconsistent application of customs regulations.
Economic conditions in Gabon weakened throughout 2016 and into 2017, as the government adjusted its budget to account for protracted low oil prices. Many international companies, including U.S. firms, continue to have difficulties collecting timely payments from the Gabonese government, and some companies in the oil sector have closed down operations. Since January 2016, an estimated 900 jobs have been lost in the oil and gas sector. While opportunities exist, the investment climate in Gabon will remain difficult until the government resolves its budgetary problems.
|TI Corruption Perceptions Index||2016||101 of 176||http://www.transparency.org/
|World Bank’s “Ease of Doing Business” Report||2017||164 of 190||doingbusiness.org/rankings|
|Global Innovation Index||2016||N/A||https://www.globalinnovationindex.org/
|U.S. FDI in partner country ($M USD, stock positions)||2015||$132||http://www.bea.gov/
|World Bank GNI per capita||2015||$9200||http://data.worldbank.org/