Angola seeks IMF support to negotiate debt with Paris Club

3 May 2006

Lisbon, Portugal, 03 May – Angola is seeking the International Monetary Fund’s (IMF) support via an ad-hoc agreement to negotiate its debt to the Paris Club and access new credit lines, newsletter Africa Monitor reported.

According to the newsletter published in Lisbon, in the most recent meetings the government has made use of the IMF’s most recent report on Angola, which gives the country’s macroeconomic situation a favorable outlook, in order to negotiate the resolution of debt and financial aid without subjecting itself to a program monitored by the Bretton Woods group.

Becoming part of a monitoring program has been a condition imposed by many countries to negotiate debts bilaterally and provide new aid packages.

Last week, Angola’s Finance Minister, José Pedro de Morais, was in Paris accompanied by the governor of Angola’s Central Bank, Amadeu Maurício, for meetings with representatives of the Paris Club, which represents countries such as Germany, Canada, Spain, the United States, France, the Netherlands, Ireland, Italy, Japan, the United Kingdom and Switzerland.

The debts owed by Angola to the Club are estimated at US$5 billion.

The argument used by the Angolan authorities in the most recent negotiations with international institutions is that Angola no longer needs a monitored agreement given the positive development of the country’s main macroeconomic indicators, backed by the IMF, and the current level of the country’s revenues driven by international oil prices.

Also according to Africa Monitor, after the agreement with the IMF, Angola plans to hold an international donor conference, to gather funds for reconstruction of the country.

In its latest report, the IMF expects that the economy will grow 13 percent between 2007 and 2010, thanks to oil revenues, which would allow an increase in public expenditure and significantly reduce the country’s debt levels. (macauhub)