Gabon’s 2025 budget deficit widens to 5.3% of gdp amid economic slowdown

Gabon’s fiscal health took a significant hit in 2025, with the budget deficit ballooning to 5.3% of GDP, up sharply from 3.8% the previous year. This deterioration reflects a combination of expansionary fiscal policies and a mounting debt burden, pushing public debt to 78.9% of GDP—a figure that contributed to the country’s sovereign credit rating downgrade in December 2025.

The economic backdrop played a crucial role in this fiscal imbalance. GDP growth decelerated from 3.4% in 2024 to 2.7% in 2025, dragged down by declining output in oil, mining, forestry, and transport sectors. While public works, manufacturing, and services showed resilience, the government’s increased spending to stimulate the economy further strained the budget, widening financing gaps.

public finances under mounting strain

The widening deficit has intensified financial vulnerabilities. The African Development Bank (AfDB) notes that the Bank of Central African States’ monetary easing fueled a surge in state borrowing, exposing banks to higher sovereign risk. Simultaneously, non-performing loans continued to climb, underscoring persistent strains within the national financial system.

This fiscal squeeze has severely restricted the government’s ability to address pressing social challenges. Poverty levels remained nearly stagnant at 33.1% of the population in 2025, while unemployment hit 20.2%, disproportionately affecting youth and women. To stabilize public finances, the AfDB advocates for stricter expenditure controls, more sustainable debt management, and structural reforms aimed at boosting state revenue.