Angola to receive IMF support

LUANDA , November 13, 2017 – The International Monetary Fund (IMF) is helping Angola to normalise access to international money markets for local banks, international media reported Monday.

Angolan Minister of Finance Archer Mangueira told the press that the government was considering a new IMF programme to assist with macro-economic improvements, budgetary consolidation, monetary and exchange rate adjustment and investment promotion. He said the parties had not yet decided whether the plan would include financing.

 As Africa’s largest petroleum producer and with roughly half the country’s GDP – USD 128 billion at market prices – relying on the commodity, Angola’s government coffers quickly dried up when oil prices plummeted. At the end of 2016, the Angolan National Assembly approved the state budget for 2017, marked by cuts of 4.7% on spending and 1.5% on social expenditure. Inflation in the African nation has reached a historic high. At the end of 2016, inflation in Angola had soared to 45% compared to a 10% inflation rate in June 2015. It fell slightly to 36.5% in March 2017.

In January 2017, the IMF suggested the government “promote economic diversification by improving the business environment, and by strengthening the role of the private sector in rebuilding infrastructure.” Signs that the government is willing to adapt and create a more business-friendly environment include the recent approval of a new, more flexible labour law; the ongoing reform of Customs tariffs by Angola’s General Tax Administration (Administração Geral Tributária), expected to enter into force during 2017; and the adoption of a new investment law encompassing a reciprocal investment protection guarantee.

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