On Jan. 29, 2016, Standard & Poor's Ratings Services lowered its long-term foreign and local currency sovereign credit ratings on the Republic of Gabon to 'B' from 'B+'. The outlook is stable. We affirmed the short-term ratings at 'B'.
The lower-than-expected Brent oil price assumptions for 2016 and a slowdown in oil production in existing oil fields will impair Gabon's external and fiscal balances, as well as the country's economic growth prospects given its high dependence on oil.
We now expect an average increase of general government debt at 2.3% over the next three years, and current account deficits averaging 3.7% of GDP over the same period.
Consequently, we are lowering the long-term sovereign credit ratings on Gabon to 'B' from 'B+' and affirming the short-term ratings at 'B'.
The stable outlook reflects our view that fiscal deficits will gradually reduce over the next few years as well as our understanding that the Gabonese authorities have taken measures to address previous weaknesses in debt management.