Fitch Ratings has cut Gabon's credit rating further into junk territory, citing widening government deficits and declining demand for the country's debt. The ratings company said in a statement on Friday that it had downgraded the nation's long-term foreign-currency rating for the second time this year, to CCC- from CCC.

According to the statement, the downgrade reflects the government's increasing reliance on short-term debt and its failure to implement structural reforms to address the country's fiscal challenges. The rating agency also noted that the decline in global commodity prices, particularly for oil, has significantly reduced Gabon's revenue base, exacerbating the country's debt burden.

Gabon's Finance Minister, Guy-Michel Etoh, acknowledged the challenges facing the country's economy but expressed confidence in the government's ability to implement necessary reforms. "We understand the concerns of the rating agencies and are working tirelessly to address the fiscal challenges facing our country," Etoh said in a statement. "We are committed to implementing structural reforms that will improve the country's fiscal sustainability and reduce its debt burden."

The downgrade comes as Gabon struggles to recover from a decline in oil prices, which has had a devastating impact on the country's economy. Gabon's economy is heavily reliant on oil exports, and the decline in global commodity prices has reduced the country's revenue base, leading to a widening budget deficit. The country's debt has also increased significantly, with the government's debt-to-GDP ratio rising to over 70%.

The downgrade by Fitch Ratings is the latest in a series of negative ratings actions by international credit rating agencies. In July, Moody's Investors Service downgraded Gabon's credit rating to Caa1 from B3, citing the country's high debt levels and declining economic growth. The downgrade by Fitch Ratings is likely to further increase the country's borrowing costs and make it more difficult for Gabon to access international capital markets.

Gabon's economy has been struggling in recent years, with the country's GDP growth rate declining to 1.5% in 2023, down from 4.5% in 2022. The country's debt burden has also increased significantly, with the government's debt-to-GDP ratio rising to over 70%. The downgrade by Fitch Ratings is likely to further exacerbate the country's economic challenges and make it more difficult for Gabon to recover from its economic downturn.

The current status of Gabon's economy remains uncertain, with the country's government facing significant challenges in implementing structural reforms to address the country's fiscal challenges. The downgrade by Fitch Ratings is likely to further increase the country's borrowing costs and make it more difficult for Gabon to access international capital markets. The government will need to implement significant reforms to improve the country's fiscal sustainability and reduce its debt burden.