Gabon’s 2025 budget deficit reaches 5.3% amid economic challenges

Gabon’s budget deficit deepened significantly in 2025, widening to 5.3% of gross domestic product (GDP), up from 3.8% the previous year. This fiscal deterioration stems from an expansionary spending policy coupled with a rising debt burden, pushing public debt to 78.9% of GDP. The mounting fiscal imbalance contributed to the country’s sovereign credit rating downgrade in December 2025.

The economic slowdown further complicated financial management, with GDP growth slipping from 3.4% in 2024 to 2.7% in 2025. Declining output in oil, mining, forestry, and transportation sectors weighed on performance, despite gains in public works, manufacturing, and services. Public expenditure to stimulate the economy amplified budgetary pressures, intensifying the state’s financing requirements.

Growing fiscal strain on Gabon’s government

As the deficit widens, financial vulnerabilities deepen. The African Development Bank (AfDB) highlights that looser monetary policy by the Bank of Central African States fueled a surge in government borrowing, heightening banks’ exposure to sovereign risk. Meanwhile, non-performing loans continued to climb, reflecting persistent strain within the domestic financial system.

This fiscal crunch restricts the government’s ability to address pressing social needs. Poverty levels remained nearly unchanged at 33.1% of the population in 2025, while unemployment hit 20.2%, disproportionately affecting youth and women. Sustainable fiscal recovery, according to the AfDB, hinges on tighter spending controls, more sustainable debt management, and structural reforms to bolster state revenue.