- Gabon is on course to maintaining the economic boom it has recorded during the first half of 2007, with the real Gross Domestic Growth expected to exceed 5% mainly because of brisk activity in mining, forestry, services, and food-processing industries.
A release issued by the International Monetary Fund (IMF) mission to Gabon International Monetary Fund (IMF) mission to review the country’s three-year Stand-by Arrangement supported by the IMF predicted a booming economy in Gabon.
During its two weeks in the country, the mission held “constructive discussions” with Gabonese economic stakeholders in both the private and public sectors, including the Minister of Economic Affairs, Mr Casimir Oye Mba.
"The performance of the Gabonese economy was satisfactory during the first half of 2007 thanks to the implementation of prudent macroeconomic policies and structural reforms,“ the IMF release said, confirming that “all performance criteria under the program at end-June 2007 were met, except for the application of the automatic adjustment mechanism for fuel prices.”
Though Gabonese economy is expected to grow by 5%, the IMF predicts a slightly lower oil production. Higher revenue and control over expenditure led to a narrower non-oil primary deficit than set in the program.
"Inflation subsided in the past few months after increasing during the second quarter because of a rise in the prices of food and fuel products,” the IMF revealed. In that, Gabonese authorities were advised to lift the recently introduced price controls, which could “trigger shortages and exacerbate distortions in the economy.”
The government was “encouraged to continue implementing prudent fiscal and monetary policies and improve competition to reduce inflation further.”
"Significant progress was achieved in the implementation of structural reforms. In particular, the mission noted that the recent difficulties faced by the state-owned energy and water company Société d'énergie et d'eau du Gabon were resolved and that following the privatization of Gabon Telecom, the transfer of assets is still underway.
"Pursuing the implementation of structural reforms is essential for improving the business climate and promoting private investment, the source of economic growth and diversification.”
Gabonese authorities agreed on measures to support the implementation of the programme for the remainder of 2007 and for 2008. As a way of complementing the gradual decline in oil production, the government was urged to continue to implement fiscal policies consistent with reaching a sustainable fiscal position by 2011.
In 2008, Gabon is asked to prioritise addressing the high level of current spending, which constrains investment in infrastructure and the social programs of the government.
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