The oil price fall in the Central African franc zone

Gabon is a member of the Central African Economic and Monetary Community and uses the CFA franc issued by the Bank of Central African States (BEAC), which is pegged to the euro. Oil makes up most of Gabon's exports and a large share of its budget, so the collapse in oil prices from mid-2014 cut government revenue and export earnings and drew down the region's pooled foreign-exchange reserves. In 2016 the BEAC tightened policy and, with the IMF, the six member states agreed on a programme of fiscal adjustment and reserve rebuilding. Gabon's growth slowed to around 2 percent a year and its debt rose, while the peg to the euro meant the currency did not adjust. The oil cycle, not domestic monetary choices, explains most of the movement in Gabon's output and fiscal charts in the decade after 2014.