Country Report Gabon

Outlook for 2008-09

• The president, Omar Bongo Ondimba, will remain the dominant political figure in the country, as he has skilfully eliminated most forms of political opposition through a combination of co-option and repression.
• Given that the most important parties in the presidential majority have been given cabinet positions, the Economist Intelligence Unit does not expect any of them to change sides and join the opposition.
• Opposition to the regime is increasingly being channelled through non-governmental organisations owing to the lack of strong opposition parties.
• Real GDP growth is forecast to remain strong, at 4.5% in 2008 and 5% in 2009, owing to robust activity in the non-oil sector and marginal increases in oil production.
• Average annual inflation is expected to remain high by historical standards, at 4% in 2008 and 3% in 2009, as a result of increased food prices in 2008 and the strengthening of the US dollar against the CFA franc in 2009.
• The current-account surplus is forecast to widen from an estimated 14.2% of GDP in 2007 to 22.9% of GDP in 2008 and 22.4% of GDP in 2009, reflecting high international oil prices.

Monthly review

• The ruling Parti democratique gabonais (PDG) has won control of eight out of nine municipal councils in the provincial capitals by forming coalitions with both opposition and pro-presidential parties.
• The alliance forged between the PDG and the two main opposition parties in Port-Gentil demonstrates the less confrontational stance that has been adopted by opposition political parties.
• The government and the IMF have continued to discuss the remedial measures necessary to complete the second review of the staff-monitored programme signed in May 2007.
• The government has imposed profit ceilings on rice and flour to offset the sharp increase in the price of basic commodities.
• The government and a consortium of Chinese enterprises have signed a new convention for the exploitation of the Belinga iron-ore deposit, which is reportedly more beneficial to the Gabonese state than the previous one.
• Total Gabon has reported a 6% drop in oil output in the first quarter of 2008.
• Manganese production has remained on track to achieve the target of increasing production to 3.5m tonnes in 2008.

SOURCE: Country Report