Angola: First Post-Financing Assessment Discussions-Press Release

International Monetary Fund

No 2023/334, IMF Staff Country Reports from International Monetary Fund

Abstract: This paper highlights first post financing assessment discussions in Angola. Successful reforms coupled by firmed oil prices supported the Angola’s economic recovery in 2021–22; however, declined oil production has led to significant challenges to the economy. Towards the end of 2022 and the first half of 2023, the oil sector weakened due to the extension of temporary maintenance operations. With declines of both oil prices and production in the first half of 2023, exports and oil revenues declined, resulting in a weakness in the fiscal and external sectors, and a significant depreciation in the nominal exchange rate in June 2023. Continued efforts are needed to bolster financial stability. Ongoing prudential reforms should continue to improve banking sector oversight and health. Maintaining focus on medium-term structural reforms is critical to maintaining growth in the context of a declining oil production. Lessening the dependence on the oil sector is critical and should remain the authorities’ medium-term focus, to reduce vulnerabilities arising from the increased volatility of this sector.

Keywords: fuel subsidy reform; oil price shock; diversification plan; diversification agenda; public finance; IMF's transparency policy; Oil prices; Energy subsidies; Oil sector; Global; Southern Africa; East Africa (search for similar items in EconPapers)
Pages: 38
Date: 2023-09-21
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