Accelerating growth: Road projects aim to unlock the country’s economic potential

The development of Gabon’s road infrastructure is one of the factors with the greatest potential to boost overall economic growth and to encourage regional trade. The government has made road network upgrades a priority under the National Infrastructure Master Plan for 2011-16 and aims to facilitate the investment of $6bn in the next five years in road infrastructure alone. The state is working to mobilise high levels of funding from both international and private sector partners to make these programmes a reality.

PHASE 1: In the short-term, ongoing work on several projects should speed up circulation between Libreville and provincial capitals. The Programme Routier 1 (PR1), launched in 2009, will have expanded and paved 236 km of high-priority roads covering roughly 24% of the national territory when work wraps up in October 2012. The PR1 focuses on three road segments along the north-south axis, the Route Nationale 1 (RN1), between Fougamou and Mouila, La Léyou and Lastourville, and Ndendé and Lebamba. The programme will ultimately create a direct line from the Cameroon border in the north near Bitam to Doussala on the Congolese border. Once complete, the new roads are expected to decrease vehicle operation costs by 38% and reduce the 13-hour journey from Libreville to Tchibanga to eight hours. The African Development Bank (AfDB) provided 90% of the financing, or CFA165.08bn (€247.62m), with CFA18.3bn (€27.45m) from the national Road Maintenance Fund (Fonds d’Entretien Routier II, FERII).

PHASE 2: In September 2011 the AfDB approved CFA167bn (€250.5m) in financing for the second phase of the road programme (PR2). Work in the second phase will complete the remaining RN1 link to the Congolese border and improve connections to Gabon’s south-western provinces, which have strong potential for the development of agribusiness, mining and tourism. A 70-km section of RN1 will be rehabilitated from Mouila to Ndendé, as well as an 85-km section of RN6 from Ndendé to Tchibanga, the capital of the Nyanga province further to the south-west. This portion of the road will open up access to Mayumba, the site of a future deepwater port. The Gabonese government launched an auto-financed project in July 2010 to lay 109 km of paved roads to complete the link between Tchibanga and Mayumba. The third road included in the PR2 project will pave a 36-km segment between Port-Gentil and Mandorové, part of the east-west axis linking Port-Gentil to the central city of Lambaréné and Ndjolé. According to AfDB estimates, work will begin in 2013 and should be complete by 2016.

UNLOCKING POTENTIAL: In the coming years, a slate of projects programmed under the National Infrastructure Master Plan should not only ease the circulation of goods and people, but also unlock zones with strong economic potential. In the past, ownership of major transport infrastructure and road projects was shared by the Ministry of Transport, the public works department and the Office of the President. Often, a lack of coordination between these parties slowed progress.

The creation of the National Agency for Public Works (Agence Nationale des Grands Travaux, ANGT) in September of 2010 was intended to both centralise and coordinate all infrastructure planning. Based on 2011 studies, the ANGT has identified several key corridors with the highest levels of population, infrastructure and natural resources and has reoriented the road construction programme to develop these routes and decentralise the economy. As Felix Edjodjom’ondo, transport specialist at the AfDB explains, “Economic development in Gabon has been concentrated in urban areas. The country has enormous potential for development, but this must start with the road network.”

CROSS-COUNTRY: One of the primary goals under the master plan is to complete the Transgabonais corridor, which connects Libreville with Franceville via major mining and forestry zones in the centre of the country. Work has already begun to refurbish and pave a 100-km segment of RN1 leading east from Libreville through the towns of Ntoum and Nsile. Work on the next segment, a 63-km stretch from Nsile to Bifoun, is set to be refurbished between mid-2012 and 2014. Work on these projects is being carried out by the local subsidiary of Chinese construction firm Entraco, under contract with Spanish construction and engineering firm Cedex.

KEY CORRIDOR: According to ANGT estimates, the Transgabonais corridor contains 942,000 inhabitants, or 70% of the population, most means of transport including river, rail and road infrastructure, as well as a considerable concentration of natural resources. Creating an efficient link will be key to plugging all human and natural resources into the national economy. A number of developments in the east, including increased mining activity from the Chinese Industrial and Commercial Mining Company of Huazhou (CICMHZ) and Australia’s BHP Billiton near Franceville, and a project to create a special economic zone for agriculture, should increase economic activity across a variety of sectors. However, efficient links to the south-east will be needed to maximise the potential benefit of these projects.

Another strategic transport corridor lies between the Transgabonais route and the Belinga iron ore deposit in the north-eastern Ogooué-Ivindo province. The Belinga deposit contains an estimated 1bn tonnes of reserves and could serve as an important driver of foreign exchange once it enters into production. However, insufficient road and rail links will limit project growth in the short-term. Projects are currently under study to create a link between Belinga and Makokou, on RN4. Ultimately, the ANGT aims to extend this road further south to Booué, a town on the Ogooué River that could serve as a multimodal transport centre in the medium term. Construction has already begun on the first half of this link, a 51-km stretch between Ovan and Koumameyong, by Chinese company SinoHydro, with financing from the Inter-American Development Bank.

FOREIGN OUTLOOK: With such an ambitious plan laid out for the road network in the next five years, international investors and contractors are playing a greater role in the sector. It is unclear how much of the proposed $6bn will be covered by the state, but it is certain that private sector partners and foreign investment will be critical to meeting sector goals.

In addition to the AfDB, which is the primary sponsor of the Programme Routier, the World Bank is financing a project to refurbish and pave a crucial 7-km stretch of RN1 that crosses the centre and outskirts of Libreville. The French Development Agency is financing the construction of a road that lies on particularly difficult terrain between Ndjolé and Medoumane and that is part of the regional artery connecting Gabon to Cameroon and the Republic of the Congo. The EU has also introduced a programme under the Ninth European Development Fund in 2007 to provide €13.75m for further road maintenance projects.

Working with the Ministry of Public Works, projects were divided into small parcels in an effort to stimulate small and medium-sized enterprises (SMEs). The programme had a limited impact on road conditions, but helped SMEs to better structure their bids for tender and improve fiscal and operational project management. Local SMEs in road construction generally have difficulty accessing financing for larger public works, making it hard to compete with majors in the sector.

CONTRACTORS: European firms have traditionally been the major actors in road transport. However, European companies are facing increasing competition from Chinese firms that are often able to offer lower-priced bids. The three segments of the PR1 were constructed by the China Communications Construction Company (CCCC), SinoHydro and the Chinese Overseas Engineering Company (COVEC), respectively. However, criticism has been levelled at Chinese companies for importing a large percentage of foreign workers. Gabonese law stipulates that the majority of jobs on construction contracts must go to Gabonese nationals, and yet the country faces a shortage of trained personnel. Some private sector companies are working to create training and scholarship programmes to boost local skill level. Spanish firm Acciona, for example, has partnered with local universities to create internship programmes to give students practical training.

Therefore, while obstacles remain, a strong government commitment, combined with much support from development partners, should go a long way towards greatly improving the country’s road network in the medium term. Opening up access to major cities and production centres in the interior will be crucial as the government seeks to diversify Gabon’s economy.

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The Report: Gabon 2012

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