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E CONOMIC PROSPECTS AND INVESTMENT OPPORTUNITIES IN G ABON F IRST UK-G ABON I NVESTMENT F ORUM 2012 HE. LUC OYOUBI, MINISTER OF ECONOMY, EMPLOYMENT, AND.

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Presentation on theme: "E CONOMIC PROSPECTS AND INVESTMENT OPPORTUNITIES IN G ABON F IRST UK-G ABON I NVESTMENT F ORUM 2012 HE. LUC OYOUBI, MINISTER OF ECONOMY, EMPLOYMENT, AND."— Presentation transcript:

1 E CONOMIC PROSPECTS AND INVESTMENT OPPORTUNITIES IN G ABON F IRST UK-G ABON I NVESTMENT F ORUM 2012 HE. LUC OYOUBI, MINISTER OF ECONOMY, EMPLOYMENT, AND SUSTAINABLE DEVELOPMENT London, 29th November 2012 1

2 I NTRODUCTION Gabon is a young economy which today fits in the scheme of structural reforms in order to become an emerging country by 2025. These structural reforms have been initiated in order to make the Gabonese growth more regular and inclusive, and should help our country to emphasize its large investment opportunities. 2

3 T ABLE OF CONTENTS Economic prospects -Short-term horizon -Medium/long-term horizon Investment opportunities -Undeniable assets -A strong sectorial attractiveness 3

4 ECONOMIC PROSPECTS -Short-term horizon -Medium/long-term horizon 4

5 S HORT - TERM HORIZON S LIGHT DOWNTURN OF THE GROWTH RATE (1) Since 2009, Gabon growth rate has been high and stable (around 7%). Table 1: Gabon GDP Growth rate Source: Ministry of Economy 5

6 S HORT - TERM HORIZON S LIGHT DOWNTURN OF THE GROWTH RATE (2) The growth rate should according to our estimations remain high in 2013 despite a slight downturn. Our countrys 2013 growth rate is still high and even higher than the one of many other regional peers. 6

7 S HORT - TERM HORIZON S TRONG MACROECONOMIC CONDITIONS Macroeconomic conditions are still robust. Table 2: Selected economic indicators Source: Ministry of Economy 7

8 S HORT - TERM HORIZON A NEW DEVELOPMENT STRATEGY A new development strategy called the Emerging Gabon Strategic Plan. This strategy aims at diversifying our countrys economy. So, it is important to take the potential impact of this strategy into account to analyze Gabons economic prospects. Analyze of economic prospects at the medium/long- term horizon. 8

9 M EDIUM / LONG TERM HORIZON T HE DIVERSIFICATION OF THE ECONOMY (1) The results of the diversification process are becoming apparent. Gabons growth is now able to face potential reversal of market conditions. Graph 1: The diversification of the economy Source: Ministry of Economy 9

10 M EDIUM / LONG TERM HORIZON A CAREFUL EXTERNAL DEBT MANAGEMENT STRATEGY Gabonese public finances are sustainable Table 3: Evolution of Government indebtedness rate Source: Ministry of Economy Reduction of public payment period from 120 days to 30 days. 10

11 M EDIUM / LONG TERM HORIZON S OCIAL PEACE AND POLITICAL STABILITY The promotion of economy diversification would create many jobs throughout the country inclusive growth and poverty reduction. Many other measures have been taken in order to promote social peace and political stability: -Reform of the social insurance fund -Modernization of health infrastructures 11

12 M EDIUM / LONG TERM HORIZON I NCREASE OF LOCAL WORKERS EFFICIENCY Many investments have been done for both non- specialized and vocational training/education. Firms which want to settle in Gabon can expect to have well trained local workers. 12

13 INVESTMENT OPPORTUNITIES -Undeniable assets -A strong sectorial attractiveness 13

14 U NDENIABLE ASSETS G EOGRAPHICAL ASSETS Gabon is the hub of many destinations in the central African region and can be a turntable for exchanges with South Africa. Gabon is member of two sub-regional groupings - EMCCA and ECCAS - represents a potential market of more than 130 million consumers. 14

15 U NDENIABLE ASSETS A FAVOURABLE INSTITUTIONAL FRAMEWORK (1) International governance asset: Liberal economic system open to foreign investors since 1989. Gabon is member of several multilateral organizations including: -World Trade Organization; -World Bank; -Multilateral Investment Guarantee Agency. Gabon has also ratified many other bilateral and international conventions of the United Nations System. 15

16 U NDENIABLE ASSETS A FAVOURABLE INSTITUTIONAL FRAMEWORK (2) Business environment: Gabon has ratified the Harmonization Treaty for Business Law in Africa and The Treaty for the intra-Africa Conference for Social Prevention (CIPRES). Gabon has adopted a Law (law n°015/98) governing the investment chart in the Gabonese Republic. This chart has subsequently resulted in the adoption of specific investment codes in the areas of Forestry, Mining, and Tourism. Gabon has created two institutions devoted to the promotion of investment and trade: -The Center for the Development of Enterprises (CDE) in order to facilitate the creation of companies in a relatively short period of time. -The Agency for the Promotion of Invetsments and Exports (APIEX). 16

17 U NDENIABLE ASSETS A ROBUST BANKING AND MONETARY SYSTEM Gabon is member of the Zone Franc so, its money is linked to the euroa cautious monetary policy. Growing interest of big African banks for Gabon (Ecobank, UBA…). Banks contribute to open up the country through the development of agencies all around the territory. 17

18 U NDENIABLE ASSETS T HE PROMOTION OF FREE ECONOMIC ZONES Creation of free economic zones throughout Gabon to encourage new growth areas by attracting investors, and to bring industry closer to raw material sources. The final objective is to give more value added to our natural resources, to create employment, and to increase revenues both for the government and the population. 18

19 U NDENIABLE ASSETS D EVELOPMENT AND MODERNIZATION OF INFRASTRUCTURES (1) The President Ali BONGO ONDIMBA decided since his election to raise the total amount of investment. Table 4: Evolution of public investment Thanks to those additional financial funds, road infrastructures have been improved. Modernization and expansion of ports in Owendo and Port- Gentil through the signature of an agreement in November 2010 with the Singapore Port Authority. Construction of a multimodal dry port in Port-Gentil and of a deepwater port in Mayumba for the exports. Source: Ministry of Economy, 19

20 A STRONG SECTORIAL ATTRACTIVENESS T HE MINING SECTOR (1) Prerequisites: In addition to reserves of oil and gas, Gabon has sizeable mineral resources (iron, gold, diamonds, magnesium, cobalt…). Recent explorations revealed more than 900 potential mineral deposit sites in Gabon. 20

21 A STRONG SECTORIAL ATTRACTIVENESS T HE MINING SECTOR (2) Efforts realized by the Gabonese Government: Development of a national Mines and Hydrocarbons industry by the creation of specialized firms ( the Gabon Oil Company, the Compagnie Equatoriale des Mines, and Gabon Steel). By 2016 Gabon aims to have developed an institutional framework that is attractive for private investments. Several industrial projects are underway : -In the manganese sector: creation of metallurgical plants in Moanda. -In the iron sector: the planned Belinga industrial complex. 21

22 A STRONG SECTORIAL ATTRACTIVENESS T HE AGRICULTURAL INDUSTRY (1) Prerequisites: Gabon is made up of about one million hectares of humid savannas perfectly suited to bio-fuel production. Currently, this sector only accounts for 5% of GDP. Efforts realized by the Gabonese Government: Creation of a special agricultural economic zone which will allow the development of agricultural production and of food processing industry. Restructuration of the institutional and regulatory framework, to develop agricultural land even in outlying areas as well as related infrastructures. 22

23 A STRONG SECTORIAL ATTRACTIVENESS T HE AGRICULTURAL INDUSTRY (2) Implementation of many projects in order to develop some specific sectors: -Intensive food-production industries; -Agro-pastoral farms; -Integrated poultry rearing. The palm oil, the rubber, and the coffee/cocoa industries will also be relaunched. 23

24 A STRONG SECTORIAL ATTRACTIVENESS F ISHING RESOURCES Prerequisites: 800 kilometers of preserved coastline in Gabon. Efforts realized by the Gabonese Government: Drafting laws in order to set up a national fishing industry and to develop outlets for a valuable market. The new laws pay attention to fishing stock and resources and aim to develop fisheries and to review fishing access rights. 24

25 A STRONG SECTORIAL ATTRACTIVENESS F ORESTS (1) Prerequisites: Forests represent more than 80% of Gabons territory. The country enjoys from a mosaic of 6 ecosystems: mangroves, forests, savannas, wet environments, mountains and plateaus. Some of the regions are still totally prestine territory 1000 species of plants have been listed in Gabon. This sector has besides been chosen by the President to be the spearhead of our development strategy and future growth. Positive externalities related to the environment field. 25

26 A STRONG SECTORIAL ATTRACTIVENESS F ORESTS (2) Environment is considered as a promising sector all over the world. The objective is to put Gabon at the leading position in certified tropical hardwood sector. Efforts realized by the Gabonese Government: Special economic zones devoted mainly to the wood- processing industry that offer various tax advantages have been created. The exploitation network is hardly touched in the wood industry despite its huge potential. 26

27 A STRONG SECTORIAL ATTRACTIVENESS S OCIAL HOUSING The President Ali BONGO ONDIMBA decided to back the building of 35.000 accommodations to meet the local demand by 2016. Local supply is insufficient to meet the demand. 27

28 C ONCLUSION (1) Thanks to the dynamism of the Gabonese President and his government, growth is high and diversified, the external debt management strategy is prudent, country risk is reduced, social peace and political stability are secured, and the quality of local workers is improved. Our country benefits from undeniable assets to and strong sectorial attractiveness with the promotion of the mining sector, of agricultural and food processing industries, of fishing resources, of wood and forest economy, and of social housing. 28

29 C ONCLUSION (2) The association of those elements makes Gabon an attractive market and destination for potential foreign investors. Foreign capital is consequently welcome to Gabon in order to take advantage of the opportunities offered by the ambitious reform agenda conducted by the Authorities. 29

30 Thank you! 30


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