Gabon is a resource-rich country on west coast of Africa & dozens of Indian firms have found it attractive to set up shop.
New Delhi: If you watch television in India, chances are you’ll have seen the commercial for Gabon.
Now, where’s Gabon? And what’s the ad all about?
Gabon is a country situated on the western (Atlantic) coast of Africa, showcasing its virgin beaches along the Gulf of Guinea. But the ad isn’t just to invite tourists, like so many other countries do. It’s to invite investors.
Gabon is slightly bigger in area than Uttar Pradesh, with a population as small as Nagaland’s. But it is fast becoming an attractive investment destination, especially for industries such as wood, cement, steel, scrap recycling and gas.
The ads are part of the reason why Everest Ply, an Indian-owned plywood manufacturer, set up its production unit in Gabon.
“We saw advertisements inviting investors to Gabon,” said Everest Ply director Amit Garg. “We also heard more about it from other investors who were planning to put up their own factories.”
Indians are not alone — already, 17 countries have poured resources into the Gabon Special Economic Zone (GSEZ), the bedrock of the country’s business investments and manufacturing operations.
Also called the Nkok SEZ, the zone was formed as a public-private joint venture between the Gabonese government and Olam International Ltd, the largest private-sector employer in Gabon and the third largest agri-business in the world. Stretching over 600 hectares, the GSEZ houses 146 investors from diverse industries, more than 40 of which are Indian firms.
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The India story in Gabon
According to a circular published by India’s Ministry of External Affairs in 2016, Gabon and India have shared “warm and friendly” relations since well before the latter’s independence in 1960.
India has so far offered two lines of credit to Gabon: The first, an offer of $14.5 million, was in 2007 towards housing projects; the second, worth $67.19 million, was for developing broadcasting facilities.
In an interview with The Wire in 2017, Gabon’s foreign minister Pacome Moubelet-Boubeya said he flew down to India because “we want Indian business people to look at Gabon as a place to invest, as a place to make money, as well as to create jobs for the benefit of the Indian companies and the people of Gabon”.
Since the GSEZ’s establishment in 2010, Gabon has seen a surge of Indians join the investment and manufacturing bandwagon.
Speaking to ThePrint, Jasvir Singh, business head of the GSEZ, narrated the story of how India’s interest in Gabon grew.
“Gabon has been able to attract more Indian investors in recent times due to demonstration of political willingness to embrace Indians for skill, technology and leading industrial development,” Singh said.
“Being the hub of timber processing industries, the GSEZ was able to attract a good number of entrepreneurs to establish their industries on account of sustainable supply of timber, ready infrastructure and ease of doing business.”
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Sustainable logging
According to Singh, while India is a manufacturer of plywood, it “depends heavily on wood imports”.
The countries India traditionally sourced wood from — Myanmar, Vietnam, Laos, and Indonesia — all stopped trading logs, either to preserve their own reserves and domestic timber industries, or due to environmental concerns.
Gabon then emerged as a viable alternative, said Singh.
“Gabon has 85 per cent forest cover, so we have plenty of reserves. But that’s not the only reason why we are attractive to Indian investors. We also follow a sustainable form of logging, which the UN has recommended to Myanmar,” he said.
“There’s no risk of the country falling behind on sustainable forest management norms.”
Sudeep Jain, director of Greenply Industries Limited, another Indian plywood firm manufacturing out of the GSEZ, explains that for every 100,000 hectares of forest land, only 4 per cent can be used for logging.
“We only cut timber that grows back every year, so every tree that we cut in one year is fully grown in the next 25. That’s also why we were attracted to Gabon,” Jain said.
Scope for improvement
So far, Gabon’s performance on the Ease of Doing Business rankings has been poor. According to the World Bank, Gabon ranks 167 out of 190 countries, but the country is hoping to change that.
“We are one of the most economically, politically, and financially stable countries in the continent,” said Singh.
The Gabonese army has been an active participant in UN peacekeeping missions, and its democratically-elected government, though facing allegations of vote fraud, is still standing.
“Plus, we have so many resources. It’s a great climate to invest in,” Singh said.