Gabon’s Agriculture Minister, Julien Nkoghe Bekale, has disclosed that the central African nation’s bid to reduce its reliance on crude oil exports, will make it a major exporter of palm oil by 2020 as it diversify into the agricultural sector of the economy.
SIAT produces an estimated 11 000 t/y of palm oil in Gabon, having invested around $100-million since 2004 but the major investment has come from Olam which signed a joint venture with the Gabon government to develop 50 000 hectares, with the option of expanding to 100 000 hectares. The project is estimated to be costing Olam $788 million.
Gabon has an estimated 5 million hectares of available arable land, with one-million hectares ready for immediate use, without reaching into rain forest.
“We have a large amount of available land and an attractive environment for investment,” Bekale said on the sidelines of the UK-Gabon Investment Forum.
According to the minister, agriculture would grow to 15 percent of GDP by 2020, from 1 percent currently.
“What we’re aiming to do is create an attractive framework, whether it be legislative, regulatory or fiscal, for investment. For agricultural enterprises we’re going to have tax exemptions on VAT, on customs and even on companies”.
West Africa consumes a huge amount of palm oil, which is used in cooking and for fuel. With the vast majority of the region’s 3.5-million tons deficit imported from Asia, Gabon is well placed to enter the market by undercutting transport costs.
“At the moment palm oil prices are good, so obviously we will seek to export it rather than focus on local consumption,” the minister said.
Like most African oil producing nation, Gabon’s economy is heavily reliant on oil exports. In 2011, oil exports accounted for about 52 percent of the country’s gross domestic product (GDP).
To attract more foreign investors, Bekale explained that unlike the oil sector where Gabon has been tightening its policy on foreign workers, the agriculture sector will have more flexible policies.
“You have to understand, the agricultural sector is not the oil sector. We need a large labour force and we don’t have enough agricultural labour so we will have to have more supple legislation in this sector.”