World Bank Freezes Gabon’s Financial Taps over Debt Nonpayment

The World Bank has suspended Gabon's ability to make loan and grant withdrawals due to nonpayment of around $17 million in outstanding obligations. Gabon, which has received over $1 billion in loans and grants, cites technical reasons and committed to clearing the debts soon. The suspension is a procedural measure, with active projects in public health, skills development, and statistics.

The World Bank has suspended Gabon's right to make loan and grant withdrawals from July due to nonpayment of outstanding obligations, a letter seen by Reuters showed on Wednesday.

The Central African country is currently repaying at least 11 World Bank Group loans, according to the bank's website. The World Bank has agreed to loan or grant Gabon more than $1 billion since 2012, disbursing more than $700 million. The bank said in the letter that overdue payments totalled around $17 million as of June 30.

A World Bank spokesperson said it was regrettable that an official letter had found its way to the media. The suspension of disbursements is a procedure provided for in financing agreements, the spokesperson said. "In the case of Gabon, we are confident that the authorities will take steps to regularize the situation as soon as possible," the spokesperson said in a statement.

Active World Bank projects in Gabon include public health, skills development and statistics projects, according to its website. A junta seized power in Gabon in August last year, ousting President Ali Bongo. It was the eighth coup in three years in the West and Central African region. The ministry of public accounts said the government had been informed about the World Bank's decision and that the payment delay was due to technical reasons.

The ministry "has already paid these outstanding debts, and all outstanding debts to other multilateral creditors are in the process of being paid and should be completely cleared within the next few days," it said in a statement. It added that the transition government had inherited considerable debt and has taken necessary steps to resolve this.

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