The
IMF forecasts a 1.3% growth in the Angolan economy this year, especially at the
expense of increasing public spending. After the suffocating stagnation that struck
the country last year it looks like growth might again be a reality, not only in
2017 but also for next year (1.5%).
Although
this auspicious growth in the face of
current scenario, it isn’t naive, since the presidential elections will take
place next August; Hence a more expansionary budget perspective.
The
Angolan economy, indeed, has kept a growth below average since the beginning of
the decade. Among other things, the IMF warns about the accumulation of arrears
by the State, and allow me to add: the country's excessive dependence on oil.
The low-price trend of recent years has led to an imbalance in public accounts
due to declining fiscal revenues, coupled with the global economic slowdown.
The
IMF also highlights the importance of fiscal consolidation, as the decrease in
revenues has led to high inflation - forecasting 27% this year and 17.8% in
2018.
Finally,
with regard to public debt, the IMF stresses that the more restrictive
financing conditions and the greater acknowledgement to debt financing have
worsened the cost of servicing the debt.
P.S.- There
were rumors the President José Eduardo dos Santos health condition worsened.
This circumstance has left his MPLA comrades apprehensive. We must bear in mind
the presidential campaign of General João Lourenço (MPLA candidate) is controlled
by the Republic Presidency. José Eduardo dos Santos is only the second
President since Angola’s Independence (1975) and has been in power for 37
years.
João
Dias - Senior Consultant
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