2013 Index of Economic Freedom

Gabon

overall score57.8
world rank99
Rule of Law

Property Rights40.0

Freedom From Corruption30.0

Limited Government

Government Spending80.1

Fiscal Freedom74.2

Regulatory Efficiency

Business Freedom56.5

Labor Freedom63.1

Monetary Freedom77.5

Open Markets

Trade Freedom61.1

Investment Freedom55.0

Financial Freedom40.0

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Quick Facts
  • Population:
    • 1.5 million
  • GDP (PPP):
    • $24.6 billion
    • 5.8% growth
    • 3.7% 5-year compound annual growth
    • $16,183 per capita
  • Unemployment:
  • Inflation (CPI):
    • 1.3%
  • FDI Inflow:
    • $728.0 million
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Gabon’s economic freedom score is 57.8, making its economy the 99th freest in the 2013 Index. Its overall score is 1.4 points higher than last year, reflecting notable improvements in investment freedom, labor freedom, and freedom from corruption. Gabon is ranked 14th out of 46 countries in the Sub-Saharan Africa region, and its overall score is lower than the world average.

The Gabonese economy has moved toward greater economic freedom over the past five years, but progress has been sluggish and uneven. Underperforming in many critical areas, the economy continues to suffer from the legacy of the previous state-led development approach. Open-market policies have not been advanced strongly. Tariff and non-tariff barriers constrain the flow of goods and services and undermine integration into the global market. The lack of access to financing, coupled with the bureaucratic investment regime, precludes entrepreneurial growth and perpetuates overreliance on oil.

The absence of an independent and fair judiciary weakens the rule of law and further undercuts prospects for long-term sustainable economic development. Corruption is pervasive, and the efficiency of government services is poor.

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Background

In 1968, President Omar Bongo declared Gabon a one-party state. He ruled until his death in 2009 when his son, Ali Ben Bongo, replaced him. The 1991 constitution ushered in reforms, including multi-party democracy with freedom of assembly and the press, but the democratic process remains deeply flawed. In December 2011, Bongo’s Gabonese Democratic Party won elections that were boycotted by opposition parties. In February 2012, Raymond Ndong Sima became prime minister. Gabon is Africa’s third-largest oil producer. In 2006, oil accounted for over 50 percent of GDP, over 60 percent of government revenues, and over 80 percent of exports, but oil revenue is controlled by the state, and most of the population remains poor. Oil production is declining, and investment is low. Forestry and mineral production are also economically important.

Rule of LawView Methodology

Property Rights 40.0 Create a Graph using this measurement

Freedom From Corruption 30.0 Create a Graph using this measurement

The rule of law is uneven across the country. The judicial system is inefficient, and protections for property rights are not strongly enforced. The judiciary lacks transparency and is subject to political interference from the executive. Enforcement of contracts can be lax. Pervasive corruption remains a serious concern, severely undermining the foundations for growth.

Limited GovernmentView Methodology

The top income and corporate tax rates are 35 percent. Other taxes include a value-added tax (VAT). The overall tax burden is equal to 11.2 percent of total domestic income, and government spending is equivalent to 25.8 percent of total domestic output. The budget surplus has been diminished significantly to 2.1 percent of GDP, but public debt has fallen to 20.5 percent of GDP.

Regulatory EfficiencyView Methodology

The regulatory framework still confronts potential entrepreneurs with significant bureaucratic and procedural hurdles. Licensing requirements take over 200 days to complete. Labor regulations are outdated and not applied consistently. Although inflation is low, the state influences prices through subsidies to state-owned enterprises and directly controls the prices of other products.

Open MarketsView Methodology

Gabon’s trade-weighted average tariff is quite high at 14.5 percent, and some agricultural imports are restricted. The poor legal system, political influence, and inadequate infrastructure still impede investment growth. The underdeveloped financial sector remains state-controlled. Credit costs are high, and access to financing is scarce. The government controls long-term lending through the state-owned development bank.

Country's Score Over Time

Bar Graph of Gabon Economic Freedom Scores Over a Time Period

Country Comparisons

Bar Graphs comparing Gabon to other economic country groups

Regional Ranking

rank country overall change
1Mauritius76.9-0.1
2Botswana70.61.0
3Rwanda64.1-0.8
4Cape Verde63.70.2
5Madagascar62-0.4
6South Africa61.8-0.9
7Ghana61.30.6
8Uganda61.1-0.8
9Namibia60.3-1.6
10Burkina Faso59.9-0.7
11The Gambia58.80.0
12Zambia58.70.4
13Tanzania57.90.9
14Gabon57.81.4
15Benin57.61.9
16Swaziland57.20.0
17Mali56.40.6
18Kenya55.9-1.6
19Senegal55.50.1
20Malawi55.3-1.1
21Nigeria55.1-1.2
22Mozambique 55-2.1
23Seychelles54.91.9
24Côte d'Ivoire 54.1-0.2
25Djibouti53.90.0
26Niger53.9-0.4
27Cameroon52.30.5
28Mauritania52.3-0.7
29Guinea51.20.4
30Guinea-Bissau51.11.0
31Central African Republic50.40.1
32Ethiopia49.4-2.6
33Liberia49.30.7
34Burundi490.9
35Togo48.80.5
36Sierra Leone48.3-0.8
37São Tomé and Príncipe 48-2.2
38Lesotho47.91.3
39Comoros47.51.8
40Angola47.30.6
41Chad45.20.4
42Republic of Congo 43.5-0.3
43Equatorial Guinea42.3-0.5
44Democratic Republic of Congo39.6-1.5
45Eritrea36.30.1
46Zimbabwe28.62.3
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