WHEN ONE COMPARE THE DEBT CAPACITY OF GABON TO THAT OF THE USA, THERE IS REASON TO WORRY! QUAND ON COMPARE LA CAPACITÉ D’ENDETTEMENT DU GABON À CELLE DES USA, IL FAUT S’INQUIÉTER!
English version Dear readers, the argument deployed in this interview at the fourteenth minute, where the spokesperson for the Gabonese presidency attempts to downplay the national debt by pointing to the debt levels of the world's leading power, the USA, constitutes a serious macroeconomic aberration. Justifying Gabon's debt by comparing it to the United States obscures basic financial principles. The United States borrows in its own currency, the US dollar, which is the world's primary reserve currency. They have total control over their monetary policy, which virtually eliminates the classic risk of default. Gabon, on the other hand, operates within the CFA franc system pegged to the euro, and must often borrow in foreign currencies. This directly exposes it to exchange rate risk and the limits imposed by its foreign exchange reserves. The dynamics of a debt-to-GDP ratio are not interpreted the same way depending on the issuer. The credibility and liquidity of the Amer...