Gabon’s budget deficit hits 5.3% in 2025 amid economic slowdown

Gabon’s budget deficit widened sharply in 2025 to 5.3% of gross domestic product (GDP), up from 3.8% the previous year, driven by an expansionary fiscal policy and a rising debt burden. Public debt climbed to 78.9% of GDP, a level that contributed to the downgrade of the country’s sovereign rating in December 2025.

This deterioration comes as economic activity slows. GDP growth fell from 3.4% in 2024 to 2.7% in 2025, hampered by lower output in oil, mining, forestry and transport sectors. Despite solid performances in public works, manufacturing and services, government spending aimed at supporting the economy further strained the fiscal balance, increasing the state’s financing needs.

Growing pressure on public finances

The widening deficit is accompanied by rising financial vulnerabilities. The monetary policy easing by the Central African States Bank boosted credit to the government, increasing banks’ exposure to sovereign risk. Meanwhile, non-performing loans continue to rise, reflecting persistent strains in the national financial system.

This fiscal situation limits the government’s room to address social challenges. Poverty remained nearly unchanged at 33.1% of the population in 2025, while unemployment stayed high at 20.2%, disproportionately affecting youth and women. A sustainable recovery of public finances will require better spending control, more manageable debt, and reforms to boost state revenues.