Angola seeks to narrow financing gap

Less than a month after revising its 2015 budget and cutting planned spending by several billion, Angola has now turned to international lenders and the World Bank in an effort to offset the effects of falling oil prices on the country’s fortunes.

According to a report in the Financial Times on Thursday, Angola is seeking around $1 billion in loans to shrink its financing gap. “The main thing is to provide some short-term support for the sharp reduction in revenue,” World Bank lead economist for Angola Souleymane Coulibaly commented. The government of Angola is reportedly negotiating a $500-million soft loan. The daily said that investment banking firm Goldman Sachs and London-based Gemcorp Capital had also been contacted for a loan.

Addressing the nation in December 2014, Angolan President José Eduardo dos Santos said 2015 would be “difficult economically.” In late-January, parliament received a revised budget, slashing the expected oil prices from $81 to $40 per barrel and reducing planned spending by $14 billion. One of the proposed measures is lowering fuel subsidies by 20 percent.