Meetings were held in Libreville from March 27 to April 14, 2006. The IMF mission, comprising Mr. Tazi (mission chief), Mr. Bouley, Mr. Leigh (all from Fiscal Affairs Department), and Mr. Ben Brik and Ms. Ramos (members of the FAD panel of experts), met with the deputy budget minister, the vice presidents of the senate, the members of the senate and national assembly finance committee, the minister of state for forestry, the audit court division presidents, the members of the economic and social council, the anti-corruption committee, the secretaries general of the ministry of state control, the ministry of forestry, the ministry of urban development and the environment, the planning commissioner, the president of the administrative reform commission, the national director of the BEAC, the directors general of the treasury, taxes, customs, procurement, and departmental inspection of the ministry of finance, the director general of oil and natural gas, the director of local governments, the secretary general of the municipal corporation of Owendo, the director of government equity holdings, and the directors of the nationsal social security fund (NSSF) and the national social guarantee fund (NSGF).
The road maintenance fund (RMF) is included in an annex to the annual budget law. The fund’s legal form is that of a treasury special account, in fact an escrow account established for the deposit of road usage fees, the government subsidy, tolls, the assistance fund paid by local governments, external financing granted for the purpose, payment for services rendered to third parties, and gifts and bequests.
Law 8/83 setting forth the Code of Equity Holdings and Presidential Decree 01302 of 11/15/79 establishing the responsibilities and organization of the ministry of equity holdings and Decree 680 of 5/28/1984 setting out the procedures for the implementation of Law 8/83.
The applicable texts are: Article 5 of Decree 1207 of 11/17/1977, Article 12 of the decree of 11/15/1979, Law 8/83 setting forth the Code of Equity Holdings, Order 15/87 of 7/25/1987, and Decree 1044 of 7/27/1987, and the 2004 Budget Law.
Namely, Banque gabonaise et francaise internationale (BGFI), Banque internationale pour le commerce et l’industrie (BICIG), Union gabonaise de banques, and Banque gabonaise de developpement (BGD), with 8 percent, 26.35 percent, 43.75 percent, and 69.01 percent of the capital held by the government, the insurance corporations AXA Gabon, Gras Savoye, and Ogare, and a financial agency Gabonese Automotive Credit and Financial Leasing Corporation (SOGACA)/(SOGABAIL), respectively.
Namely, the agency for the safety of aerial navigation in Africa and Madagascar (ASECNA), the office of ports and harbors of Gabon (OPRAG), the domestic navigation company (DNC), and PSM in the transportation sector and the construction and public works laboratory of Gabon (LBTPG) in the industries and services sector.
Consequence of Law 8/83 regarding government participation without charge in the capital of corporations, which had stipulated that all corporations organized under Gabonese law were required to offer the government a free-of-charge 10 percent interest in their authorized capital at the time of their establishment.
These free services provided for the government were examined by a parliamentary investigative commission as part of a study of the financial problems of Gabon Poste.
The annual privatization program is adopted by decree of the council of ministers and is attached to the annual budget documents.
PR Decrees 000289/PR and 000287/PR of March 1997 defining responsibilities and operations.
The legal provisions include Law 015/98 of July 23, 1998, the investment charter, Decree 001140/PR/MEFBP of 2002 on public procurement; and Law 3/94 of November 21, 1994 setting forth the labor code.
The investment charter establishes the general principle of equal treatment for domestic and foreign enterprises, equitable and transparent application of the business law adopted under the OHADA treaty, and equitable and transparent application of the labor code and social security legislation in accordance with the treaty of the Inter-African Conference on Social Security (CIPRES).
General code of direct and indirect taxes, code on the recording of real property income, general customs code, code of commerce.
Private sector wage earners are covered by a social security plan administered by the NSSF, which is based on contributions. The contribution rates are fixed by decree.
Order 006/PR of 2000 and Law 003/2000 of 2000.
HRA refinancing activities totaled CFAF 96 million in 2004.
The latter two corporations are not included in the government’s equity portfolio.
This fund collects an off-budget tax, which in 2004 totaled CFAF 2.3 billion.
Moreover, the constitution states that the government may, in urgent cases and for purposes of implementing its program, petition parliament for authorization to issue an order during the parliamentary recess to carry out measures that are normally the province of the law and, more specifically, supplementary budgets, as provided for by Article 29 of Law 4/85.
Law 15/96 on decentralization established principles governing responsibilities at the decentralized level, which include: regional development, health, education, urban planning, property registration, housing and accommodation, environment and sanitation, village water resources, facilities, roads, urban, interurban, and interdepartmental transportation, water, agriculture, fisheries, livestock, and quarries.
Local governments are subject to two types of supervision: administrative supervision by the ministry of the interior and financial supervision by the MEFBP (i.e., the directorate general of the treasury).
Local government revenue includes proceeds from the provision of services and from leasing, sales of goods and services, the transfer of assets, miscellaneous proceeds, local fees and taxes, financial earnings, operating subsidies from the government for vehicle maintenance, removal of household waste and specific material, tax rebates, taxes on fuel, property registration and stamp taxes, and fines and pecuniary judgments. For fiscal year 2004, local government resources totaled CFAF 25.65 billion for 97 government units. The communes of Libreville and Port-Gentil account for 75 percent of that amount.
Law 15/96 states that the operating portion cannot exceed 60 percent of the budget, although this limit does not seem to be observed.
Laws 4/85, 5/85, 5/94, 6/2002, 11/2005, Decrees 481/2002, 484/2002.
The legal framework includes Budget Framework Law 4/85 establishing the general budget framework, Law 5/85 on general government accounting regulations, which defines the procedures for budget execution, Laws 6/2002 and 11/2005 amending certain provisions of Law 4/85, the annual budget laws, the supplementary budgets, and the budget review laws. These laws are currently being revised.
Namely, the sole principal payment authorizing officer, the minister of finance, budget appropriations managers who are members of government, and the presidents of official entities.
Government accountants are officials authorized to carry out revenue, expenditure, and cash transactions for the government and to keep accounting records.
Eighty-two percent of the DGI’s non-oil revenue is collected through voluntary compliance and withholding, and 18 percent through the issuance of tax assessments.
These are conventions granting exemption from corporate tax and the minimum presumptive tax for the Office of Ports and Harbors of Gabon (OPRAG), the Oil Tanker Port of Owendo (PMO), the NRPC, the Refuse Recovery Corporation of Gabon (SOVOG), and hotel corporations.
The organization of the DGI is defined by Decree 01139/PR/MEFBP of 12/18/2002 amended by Decree 000720, and the external services are governed by MEEF Order 0011 of December 6, 2005.
Calculations based on data for 2005.
For example, for fiscal year 2005, although the deduction specified by law would have been more than CFAF 150 billion, the stock of deposits in this account at the end of the fiscal year was less than CFAF 100 billion.
The stock of deposits in the FGF totaled CFAF 70.4 billion at the end of fiscal year 2002, but in 2003 it fell to CFAF 40.4 billion and stood at only CFAF 30 billion in December 2003.
The law has been promulgated. Specific regulations for each category of employee, have been drafted and submitted for comment to the institutions responsible for administrative reform.
The declaration of assets also includes those of the filer’s spouse(s) when the latter is (are) engaged in a private, for-profit activity.
Law 14/2005 of August 8, 2005.
Law 010/2002, applicable to any depositary of the government authority defined as a political and administrative authority, public servants, statutory or casual employees of the government, employees of local governments, employees of public, or parapublic corporations.
Law 011/2002; the NCAUE is an independent administrative authority.
If no declaration of assets is submitted, the penalties incurred are those provided for in Article 125 of the Criminal Code.
The senate’s role in the adoption of the budget is not clear in the law.
For example, the document does not indicate revenue from the central bank.
The non-oil primary deficit is equal to non-oil revenue (including grants) minus primary expenditure (excluding social restructuring costs, privatization receipts, and subsidies on the prices of petroleum products).
For example, in June 2005 (during the fourth review of the IMF program), the authorities set the fiscal policy target for 2005 at a non-oil primary deficit of 6.7 percent of non-oil GDP. In October 2005, the government adjusted this target to 8.4 percent, and the December 2005 TOFE indicates that the primary non-oil deficit reached 12.1 percent of non-oil GDP for fiscal 2005.
Because the basis of oil taxation is monthly, the annual model cannot be used for making accurate projections or determining whether oil revenue owed the government has been received in full. Moreover, the oil revenue model cannot be used to monitor all the taxes transferred to the government in the form of crude oil at the terminal, which must be sold before arriving at the treasury. The authorities are in the process of strengthening their capacity to monitor and predict the trend of oil revenue by increasing the resources allocated to the DGI to manage all oil-related revenue flows.
The budget framework law states that financing operations reflect the balance of budgetary operations, which represents either the government’s financing requirement or its net lending.
However, the NSSF, in cooperation with the International Labor Office, prepares an actuarial assessment that is used to examine the long-term solvency of the NSSF system.
The fund covers workers in public enterprises, local government workers, private sector workers, and temporary government labor.
A budget allocation of CFAF 4.2 billion (CFAF 1.5 billion for indigent benefits, CFAF 1.6 billion for contractors’ pensions, and CFAF 1.2 billion in operating subsidies) was recorded in the 2005 and 2006 budget laws.
The system comprises four branches: family and maternity services; old-age, disability, and survivors’ pensions; work-related risks; and health care.
As of April 1, 2006, implementation of the 2006 budget had not yet begun.
The time limit of 120 days set by the treasury to pay government creditors complicated the assessment of payment arrears. The amount of treasury arrears during 2000-04 was estimated at end-November 2005 at CFAF 29.4 billion.
Financial control is the responsibility of a directorate general of the MEFBP, which examines the legality of expenditure and determines whether services were actually provided.
Numerous units should perform this control: financial control, DGP, inspectorate general of services, general government control, audit court, and parliamentary investigative commissions.
Decree 001140/PR/MEFBP of December 18, 2002 setting forth the procurement code.
Decree 1102/PR/MEFBP of October 4, 2003 creating the DGP.
Decree 10/44/PR/MEFBP of September 1, 2003. The CNMP reports to the prime minister. It is composed of the Secretary General of the Government, the Minister of Government Control, the minister responsible for finance, the minister responsible for the specific contract, the minister responsible for land development, the minister responsible for planning, and the director general of the DGP (rapporteur).
The procurement control functions include the issuance of a prior, formal notice by the DGP before contracts can be concluded, examination of the technical preselection and bidding documents before the invitation to bid is issued, the analysis of bids, and selection of the winning bid. For contracts submitted to the CNMP, an analytical report and a detailed report from the DGP are required.
With the implementation of these rules, it will be possible to capitalize on experience, reward merit, and recruit individuals with technical skills needed by the administration.
In early April 2006, only the end-November 2005 accounting statements were available.
However, at end-2004, the balance of the expenditure pending classification and regularization account was CFAF 61.6 billion.
For example, the accounting data of the municipality of Owendo do not match the data on that municipality in the treasury accounts.
The constitution states that the budget review law must be submitted to parliament by the start of the first regular session (which begins on the first business day of March) of the second year following the fiscal year in question. The second session begins on the first business day of September.
The budget of the national defense ministry contains more than 200 chapters.
The import parity price is determined by adding to the price on the international market (in Genoa) all the maritime freight and import costs (from Genoa to Port-Gentil), financing costs, port taxes and customs duties, storage fees, and a competitiveness differential for the refinery. The formula is specified in Order 00018/MMEP/MFEBP-CP, “Application of the petroleum product price indexing mechanism.”
No information on the nature of this type of investment is available, apart from the financing of the hospital in Franceville.
The outlook for 2005-06 was disseminated in February 2006; past data related to 2004.
While the rates of oil revenue collection averaged 98 percent vis-à-vis the supplementary budget(SBL), they averaged 130 percent vis-à-vis the estimates in the initial budgets (IBLs).
The accounting system could record revenue and expenditure on an accrual basis; however, the accrual concept is of little use when the collection rate is low.
At present the accounts of the principal government accountants have been granted a quitus for 1965-78, as they cannot be audited. For 1979-2000, the accounts were audited on a provisional basis, and the 2001 and 2002 accounts have been examined.
The audit court is currently auditing the NSSF and the NSGF.
The audit court rules by provisional order, which only becomes final if the third party produces the evidence necessary to support its allegations.