• The Angolan economy is enjoying a mild recovery this year but significant macroeconomic imbalances remain.
• The new Government is fully aware of the imbalances and has approved a plan to begin addressing these challenges.

An International Monetary Fund (IMF) team led by Ricardo Velloso visited Luanda during November 6-15, 2017, to prepare the groundwork for the Article IV consultation mission expected in early 2018, and to hold preliminary discussions on the new government’s economic policy and reform plans to address macroeconomic imbalances and improve economic growth prospects. At the conclusion of the mission, Mr. Velloso issued the following statement:

“The Angolan economy is enjoying a mild recovery this year but significant macroeconomic imbalances remain. Output is projected to grow 1.1 percent and the external current account to narrow to 5.2 percent of GDP as Angola’s terms-of-trade improved. However, inflation remains high. Despite increased sales of foreign exchange by the National Bank of Angola that reduced net international reserves to US$14.9 billion in October, the spread between the parallel and official market exchange rate remains wide and a backlog of foreign exchange purchase requests in commercial banks still exists.

“Macroeconomic imbalances need to be tackled decisively. The new government is fully aware of the challenges and recently approved a six-month plan (Plano Intercalar) to guide policy actions until the National Development Plan 2018-2022 is unveiled. The mission took stock of recent economic developments, and got acquainted with the authorities’ plans to address macroeconomic imbalances. The Plano Intercalar is adequately focused on the goals of stepping up fiscal consolidation efforts, introducing greater exchange rate flexibility, and improving governance and the business climate to promote faster and inclusive growth as well as economic diversification.

“The mission held fruitful discussions with Minister of State for Economic and Social Development Manuel Nunes Júnior, Finance Minister Archer Mangueira, Economy and Planning Minister Pedro da Fonseca, Commerce Minister Joffre Van-Dúnem Júnior, National Bank of Angola Governor José Massano, and other senior officials of the executive branch. The mission also held discussions with members of the Economic and Finance Committee of the National Assembly, and representatives from the financial sector, the non-financial private sector, the state-owned oil company Sonangol, the sovereign wealth fund, and the diplomatic community.”