Gabon’s budget deficit widened sharply to 5.3% of gross domestic product (GDP) in 2025, up from 3.8% a year earlier, according to the 2026 African Economic Outlook released by the African Development Bank. The deterioration in public finances is mainly driven by an expansionary fiscal policy combined with an ever-heavier debt burden. Public debt rose to 78.9% of GDP, a level that contributed to the downgrade of the country’s sovereign credit rating in December 2025.
This development comes amid a slowdown in economic activity. GDP growth slowed from 3.4% in 2024 to 2.7% in 2025, hampered by declines in oil, mining, forestry, and transport output. Despite solid performances in public works, manufacturing, and services, the government’s spending to support the economy further strained the fiscal balance, increasing state financing needs.
Growing pressure on public finances
The widening deficit is accompanied by rising financial vulnerabilities. The African Development Bank notes that the monetary policy easing by the Bank of Central African States spurred a strong increase in credits extended to the state, raising banks’ exposure to sovereign risk. Meanwhile, non-performing loans continue to climb, reflecting persistent tensions within the national financial system.
This budget situation limits the government’s room to address social challenges. Poverty remained nearly stable at 33.1% of the population in 2025, while unemployment stayed high at 20.2%, with a particularly severe impact on youth and women. Sustainable fiscal recovery will require better spending control, more manageable debt levels, and reforms to boost state revenues.
