IMF program for Angola is a “sign of hope” for Portuguese companies

“THEAngola negotiated a financial aid pact with the IMF, which it complied to the letter, completely, in such a way that they are pre-negotiating a second package, and I say pre-negotiating because as there are elections in August, until then the effort of the Angolan executive it is not a financial package that will force some difficulties, such as the price of fuel, which is a topic on the table with the IMF”, said the delegate of the Agency for Investment and Foreign Trade of Portugal (AICEP) in Luanda.

In the opening speech of the webinar on “Angola: a new approach”, organized by AEP – Associação Empresarial de Portugal, AICEP and KPMG Portugal, Miguel Fontoura added: “When you sign the package [de ajuda financeira]that issue will be on the table and moreover, they will have to reduce fuel subsidies, and therefore, understandably, they don’t want to do it before the elections”.

According to Miguel Fontoura to businessmen, “the question is not when, it is if, and will they do it, and that is a very healthy sign that the International Monetary Fund [FMI] believes in the solvency and viability of the Angolan economy”.

In his speech, the official pointed out the importance of Angola for national exports, noting that it was already the fifth largest destination for Portuguese exports and the first outside the EU, and that although having lost value due to the recession of recent years, it continues to be an important market. , ranking ninth among customers in Portugal.

“We export more than twice as much to Angola as to Scandinavia, Angola is the ninth destination country for exports, and for us it is a strategic desideratum, where the companies that arrive and those that are in the market consider it strategic”, said Miguel Fontoura. .

The more than 1,200 Portuguese companies in Angola “reduced the number of expatriates, but they did not leave the market and did not stop believing in the market”, he said.

Commenting on Angola’s economic evolution, the official said that the country “turned the page” already last year, when it grew by 0.7%, and considered that this economic growth, the first since 2016, is still not enough, but it is already a good indicator.

“Angola grew by 0.7% in 2021 and is expected to grow by more than 2% this year, it is still not the growth that Angola needs, but it is growth after five years of recession, and this is extremely important,” he said.

In his speech, Miguel Fontoura also stressed that the high price of a barrel, above US$100, will lead to a budget surplus compared to the US$35 foreseen in Angola’s Budget for this year, “and this is excellent news for the recapitalization of public companies and to give the Government financial leeway”, which can be positive for Portuguese companies that have Angolan public companies as their clients.

There is, he concluded, “a moderate confidence of Portuguese companies in the Angolan economy in the coming years”, recommending that entrepreneurs invest in other sectors of the economy: “The emphasis of growth is not only on the extractive industry, but also on economic diversification, an effort that Angola is taking very seriously”.

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