Gabon's natural resources and industries helping create diversified economy

An oil-rich equatorial country in West Africa, Gabon’s abundant natural resources have given it one of the highest per capita incomes in Africa, though lower oil revenues has seen growth contract in recent years. Nonetheless, thousands of kilometres of dense jungle rich in minerals and timber, decades of political stability and strong ties with both the EU and Gabon’s regional neighbours should help the country withstand near-term oil shocks.

History

Although there is little historical record of the arrival of Bantu ethnic groups in Gabon, the country’s first known inhabitants settled in the country’s forests in around 5000 BCE. The first wave of Bantu migration began 750 years ago from North Africa, while the Mpongwe group from the Myene branch settled in the country in the 11th century, followed by a wide variety of ethnic groups arriving along the Ivindo Valley from the 16th century onwards, and the Fang during the 19th century.

The first European contact with Gabon occurred in the 15th century, and Gabon’s coast became a hub for the slave trade in the years following, with Dutch, British and French traders arriving in the 16th century. Treaties between the French and Gabonese coastal chiefs, signed in 1839 and 1841, saw the country become a French protectorate and marked the start of a deep and ongoing relationship between the two nations. Indeed, it was the 1849 capture of a slave ship by French forces that led to the foundation of capital city Libreville, which had already been settled by American missionaries during the 1840s.

Politics & Independence

By 1885 France occupied Gabon, although it did not officially administer the country until 1903, and in 1910 Gabon became one of the four territories comprising French Equatorial Africa, a federation that lasted until 1959. The four members gained independence as the Central African Republic, Chad, the Republic of Congo and Gabon in 1960. Leon M’Ba served as the country’s first prime minister and subsequently president when the country became a presidential republic in 1961. M’ba was succeeded by Omar Bongo Ondimba following his death in 1967.

The country was controlled by a single-party system until its 1991 Constitution helped bring about the legalisation of opposition parties. Omar’s son, Ali Bongo Ondimba, was elected in August 2009 after his father’s death. He continues to serve as president today, having won a closely contended presidential election on August 27, 2016 by 5594 votes. The aftermath of the ballot saw protests erupt as supporters of opposition candidate Jean Ping called for a recount. However, Gabon’s constitutional court upheld Bongo Ondimba’s victory, indicating a slightly higher majority than first announced – 50% of the vote, up from 49%.

Geography

Slightly smaller than the US state of Colorado, Gabon covers an area of 267,667 sq km, with 10,000 sq km of narrow coastline stretching across 885 km of the Gulf of Guinea. From the coast, the terrain transitions into hilly jungle in the interior, with savanna regions in the east and south. The majority of the country’s land (17.2%) is used for permanent pasture, and with only 40 sq km of irrigated land as of 2012, 1.2% of Gabon is set aside for arable farming, while 1% is allocated to permanent crops.

Gabon’s vast forested areas are home to more than 3000 species of vegetation, including the native hardwood tree, okoumé – a mainstay of the country’s timber industry. The Gabonese rainforest is also inhabited by at least 190 species of mammals, including antelope, tropical birds, forest elephants and a quarter of Africa’s gorillas, making it one of the most biodiverse countries in West Africa. Gabon’s Lopé National Park, initially known as the Lopé-Okanda Wildlife Reserve, was founded in 1946 and is located in the centre of the country. The park was designated a UNESCO World Heritage site sometime in 2007.

Gabon’s climate is equatorial, with high year-round temperatures and humidity. Annual average rainfall fluctuates from 3050 mm in Libreville to 3810 mm on the north-west coast, most of which falls during the October-May rainy season. Between June and September humidity is high despite there being virtually no rainfall in these months.

People

Gabon is home to 40 separate ethnic groups, the majority of which speak Bantu languages, which are classified into 10 linguistic groups. The Fang, located north of the Ogooué River, as well as within southern Cameroon and Equatorial Guinea, account for roughly 25% of the population, while the Myene, including the Mpongwe and Orungu, comprise a much smaller portion of the total despite their prominent role in the country’s historical development, particularly along its northern coasts.

South of the Ogooué River, the largest groups are the Sira – including the Punu – the Mbete and the Nzebi, which together comprise around a third of the population. There are also groups of Benga and Seke in the north-west, Kota and Teke in the east, and Vili along the southern coast. French colonial governments maintained a policy of limiting the use of native languages to religious teaching and promoted the learning of French. As a result, the vast majority of adult Gabonese citizens can speak French.

The World Bank reports that Gabon has one of the highest urbanisation rates in Africa, with over 80% of its citizens living in cities and nearly 60% of the population concentrated in Libreville and Port-Gentil, the economic capital of the country. Demographically speaking, Gabon is a young nation, with nearly 63% of the population under 24 years of age.

Oil Economy 

According to the latest available official data, as of 2013 Gabon’s population totalled just 1.8m, compared to 22.3m in Cameroon and 4.6m in the Republic of the Congo. However, the country is one of just a few upper-middle-income countries in sub-Saharan Africa and benefits from abundant natural resources, including considerable hydrocarbons reserves, with the World Bank citing Gabon as the fifth-largest oil producer in Africa. Oil accounted for 70% of exports, 20% of GDP, and 40% of budget revenues in 2015 (See Economy chapter).

A mature producer, Gabon has seen oil output decline over the last decade, with the BP “Statistical Review of World Energy June 2016” putting the country’s production at roughly 233,000 barrels per day (bpd) in 2015, down from 270,000 bpd in 2005. Almost half of total production comes from offshore fields, particularly those near Port-Gentil, while major onshore production sites include Sette Cama and Rabi Kounga. Most of Gabon’s oil is exported to Japan, the US, Australia, India and Spain, according to the US Energy Information Administration.

Market Crash 

Declining production and lower oil prices have seen economic growth slow. Gabon’s GDP growth averaged slightly above 3% between 2004 and 2014, according to World Bank data, despite high levels of volatility: growth hit a high of 9.14% in 2010 after having contracted by 3.63% in 2006. Like many oil-dependent nations, Gabon’s economy has felt the impact of depressed global oil prices in recent years, with the World Bank reporting that real GDP fell from $18.18bn in 2014 to $14.34bn in 2015, while GDP growth slowed from 5.6% in 2013 to 4% in 2015, largely as a result of falling oil prices and cuts to public investment. Data regarding sectoral contributions to GDP in 2015 shows a 8.3% year-on-year increase in primary sector activity and a rise of 5.6% in the tertiary sector. Meanwhile, a 1.5% decrease was posted by the secondary sector, despite a strong performance from the timber industry, which posted a 22.6% increase in activity.

Gross national income per capita, as expressed in dollars, also decreased, from $10,410 in 2014 to $9210 in 2015, though this is still nearly five times higher than the sub-Saharan average. However, these figures do not paint an accurate picture of the real economy, which are more uneven. The US State Department reports that the richest 20% of the population receives more than 90% of the country’s income, while a 2013 McKinsey report suggests that about 30% of the population was living with monthly incomes below minimum wage.

Diversification Drive

Diversifying the economy is a priority for the Bongo Ondimba administration, as evidenced by recent efforts to boost production of palm oil, iron ore and manganese. The Emerging Gabon Strategic Plan emphasises improving the level and quality of both infrastructure and human capital, which the IMF praised in February 2015 as tackling two of the country’s binding constraints to growth. The IMF also commended Gabon for making progress in implementing its plan since 2012, by using windfalls from high oil prices to improve transport and energy infrastructure, and establishing joint ventures with foreign firms in non-oil, high-value-added sectors like natural resource processing.

You have reached the limit of premium articles you can view for free. 

Choose from the options below to purchase print or digital editions of our Reports. You can also purchase a website subscription giving you unlimited access to all of our Reports online for 12 months.

If you have already purchased this Report or have a website subscription, please login to continue.