Angola: Banks offer better rates than in some Southern African countries

18 December 2007

Luanda, Angola, 18 Dec – Angolan banks offer better banking guarantees and interest rates than those offered in some Southern African countries, according to a report by the World Bank on the country’s investment climate.

The World Bank report, accessed by Angolan news agency Angop Monday in Luanda, was based on the results of a survey of 310 private companies in the provinces of Luanda, Benguela and Huambo.

According to the document, interest rates and bank guarantees are even more attractive in Angolan when compared to countries in sub-Saharan Africa and Algeria.

According to the report, despite rejecting 79 percent of loan requests, the problem of access to credit in Angola is not related to cost, but rather to its availability.

Meanwhile, the report, drawn up in October 2007, noted that the complexity of the process of applying for a loan and turning down guarantees were the main causes of the “poor penetration” of the banking sector in Angola.

“More than 80 percent of companies in Angola have never requested a loan. A third has not done so as they consider the process to be too complex, and amongst those that have, one third were rejected because the bank refused to accept the proposed guarantee,” the document from the World Bank.

The report on the Analysis of the Investment Climate in Angola aimed to verify in detail the factors that limit the private sector, such as financial markets, identify priorities, as well as permitting the relationship between constraints on the level of companies and productivity. (macauhub)