Gabon Open for Business
By Paul Ndiho, Washington D.C
September 20, 2011
The central African nation of Gabon recently launched a Special Economic Zone (SEZ) in Nkok, near the capital, Libreville. The zone is meant to attract foreign investment and create employment for its local population.
Gabon’s government wants to diversify the country’s economy amid declining oil production. Gabon depended on timber and manganese until oil was discovered offshore in the early 1970s. The oil sector now accounts for more than 50% of Gabon’s gross domestic product. Gabon’s special Economic Zone was initiated in July 2010 by President Ali Bongo Ondimba. He says that the time to diversify Gabon’s economy is now.
“We have to follow the aspirations of our people and we feel that the time has come to move to another era and preparing for the post-oil era, so it’s important for me to diversify our economy.”
President Ondimba says that his government is putting more emphasis on investment and infrastructure development.
“We are a country of forestry, mining and also oil but we now want to go into processing because it’s important for us to have more revenue in order to satisfy the aspirations of our people. It’s also important for us to attract foreign direct investment because in our country the Government can no longer be the business man and do everything as was the case in the past.”
In 2010, the government signed a 200 million dollar strategic agreement with Singapore-based OLAM International, to jointly develop a special economic zone (SEZ) at Nkok for timber processing which will be completed in March 2012.
Mr. Gagan Gupta, OLAM’s Director General, oversees the S-E-Z and says it will be of great advantage to investors, and the local population.
“An economic zone is not about creating infrastructure, so you can spend 200 million dollars on building roads, water supplies and electric supplies that is what’s called hardware. But an economic zone is only successful if you are able to attract private companies to come and set up industries there. So what has been good about the economic zone is that in a very short span of time which is less than one year we have been able to attract an investment close to 1.2 billion dollars in this country.” Mr. Gupta aslo acknowledges that when the project started very few people believed in it.
“In Africa you get 20,000 projects like this announced every year. And you hardly see one project taking off on the ground, so when we signed last August 2010, six people believed this probably could happen. But as we started progressing, people came and saw the sight so how the progression was happening more and more people started turning favorite sites. Today Gabonese believes this project can happen. It’s a reality; it is no more a dream.”
Analysts say that a successful economic zone will create employment for Gabon.
“This economic zone is the first of its kind in this region. It’s going to solve the problem of unemployment in Gabon and there is going to a spin off a lot of other industries that will come off from this… This is a great job.”
Theophile Ogandaga, the government coordinator, notes that this economic zone will make Gabon more competitive:
“This project, is perusing two specific objectives, one is to contribute the diversification of our economy and to create employment for our young people.”
Critics say despite the abundance of natural wealth, poor fiscal management continues to hobble the economy and that on paper, Gabon enjoys a per capita income four times that of most sub-Saharan African nations, but because of high-income inequality, a large proportion of the population remains poor. A drive through the suburbs of the capital Libreville changes the narrative. People are on the streets trying to make living by selling everything from fresh foodstuffs, clothing and house hold items.