International Financial Market: Gabon Prepares to Raise $580 Million

To pilot this transaction, the State has mandated BofA Securities as sole lead manager tasked with gauging institutional investors' appetite for fixed-income securities. This operation follows directly from the loan closed a few months earlier, which enabled the country to raise $920 million via a seven-year Eurobond featuring a three-year deferral and a face coupon of 9.375%.

Taken in its entirety, this double foray into external markets allows the State to exhaust the remaining balance of the international borrowing ceiling authorized by the collective budget. It especially outlines a trajectory of sustained debt for the coming fiscal years. Preliminary orientations in the draft budget already sketch prospects for massive calls on international markets, with an envelope targeting around 1,100 billion CFA francs to cover the following year's expenditures, in addition to resources to be mobilized on the regional compartment. This dynamism on the external borrowing front occurs within a singular accounting context, marked by the recent revaluation of the global stock of sovereign liabilities following a thorough audit conducted by the administration, bringing the consolidated outstanding to a level more compliant with community convergence criteria, while brushing against the tolerance ceiling set at 70% of gross domestic product.

The multiplication of these bond fundraisings and the prospect of additional volumes issued on the markets are nonetheless not without effect on the behavior of Gabon's signature. Secondary issuances already in circulation have recorded successive declines on European financial markets, reflecting the caution of bondholders facing the medium-term deterioration of the debt profile.

Parallel to these market operations, Libreville continues intensive negotiations with the services of the International Monetary Fund to seal a new reference program, an essential step to strengthen the credibility of the macroeconomic trajectory before global creditors and to durably structure the country's financial architecture.

Asaba