The repercussions of the recent coup in Gabon will be felt in Cameroon and the sub-region as a whole as Gabon and Cameroon are both members of CEMAC. This article looks at the history of Ali Bongo’s political rise, followed by a snapshot of the Gabonese economy, before analysing the probable economic impact of the coup d’etat on the Cameroonian economy. The Gabonese economy and the CEMAC sub-region Gabon is the fourth-largest oil producer in sub-Saharan Africa. In 2021, Gabon’s oil sector represented 80 per cent of exports, 45 per cent of GDP, and around 60 per cent of tax revenues. The fallout from Russia’s invasion of Ukraine hampered Gabon’s economic growth. Gabonese households have faced rising food prices since 2022, when the inflation rate reached 4.3 per cent, considerably above the CEMAC threshold of 3 per cent. However, the country has taken measures to combat the rising cost of living, including a temporary price cap for 48 imported consumer products from October 2022 to March 2023. Despite these difficulties, Gabon’s economy is gradually improving thanks to solid performance in the oil, mining, and timber sectors. GDP is estimated to have increased by 3.1 per cent in 2022, up from 1.5 per cent in 2021. In addition, the budget balance has become a surplus, at 3 per cent of GDP for 2022, after a deficit of 1.9 per cent in 2021. This gradual recovery reduced public debt in 2022, representing 52 per cent of GDP, compared to the 60.7 per cent recorded in 2021. According to the Debt Sustainability Analysis published by the IMF in July 2022, this level of public debt is estimated to be sustainable, and risks have eased. However, as the economy improves, a significant segment of the population suffers from a high youth unemployment rate and a low quality of life for a third of the population. Gabon needs to collect data as it should, so it is difficult to judge socio-economic poverty. But the blow would have impacts on the countries in the sub-region. Economic impacts of the coup The coup will impact the Gabonese and Cameroonian economies and the sub-region. The putschists proclaimed the closure of Gabon’s borders, thus putting the country in isolation «until further notice.» In 2018, Gabon exported $9.14M to Cameroon. There were no main exports from Gabon to Cameroon in 2018. During the last 23 years, the exports of Gabon to Cameroon have increased at an annualized rate of 6.81 per cent, from $2.01M in 1995 to $9.14M in 2018. In 2018, Cameroon exported $46.2M to Gabon. This will slow down imports into Gabon and could slow down economic activity in neighbouring Cameroon, which exports chocolate, soup and broth, refined oil, soap, and milk to Gabon for an estimated value of $46.2 million annually. Meanwhile, 85 per cent of Gabonese exports to Cameroon are palm oil, estimated at $9.14 million, which the border closure will block.
Figure 1 : Cameroon exports to Gabon
It is essential to specify that companies such as Sofavin have already invested 12.5 billion CFA francs (around 20 million dollars) as part of this agreement, and another $20 million will be invested in 2023. On the other hand, Gabon remains an essential investor in Cameroon. During its bond issue, Gabonese investors were the second subscriber, representing 22.2 billion FCFA in subscriptions, or 12.6%. The coup will slow the implementation of the AfCFTA in the CEMAC region. The six CEMAC countries have signed and ratified the Agreement Establishing the African Continental Free Trade Area (AfCFTA). They have also all signed the Economic Partnership Agreement (EPA) with the European Union, although only Cameroon has ratified it to date. The coup and border closures will slow the implementation of trade agreements and reduce the positive impacts of trade across the region, especially for Gabon. Remember that trade contributes 35 per cent to national output versus 39 per cent for Cameroon.
The IMF could suspend the disbursement of funds.
On June 27, 2022, the Executive Board of the International Monetary Fun...