Angola: Economic growth will be less “impressive” but better for employment and diversification – BPI

26 June 2008

Lisbon, Portugal, 26 June – The slowdown of Angolan economic growth in 2009, to less “impressive” levels than those of the last few years, is beneficial to the country’s development, allowing for diversification and Job creation, according to analysts from Portuguese bank BPI.

The development of the oil sector, “has ahd a direct restricted imapct on the traditional Angolan economy,” according to the Angola report, published Wednesday by the Office of Economic and Financial Studies of BPI.

Stabilisation of oil production, which over the last few years had been increasing significantly, is the main reason for the slowdown forecast by the Organisation for Economic Cooperation and Development (OECD), and the World Bank.

The World Bank this month revised its figures for Angola, now projecting growth of 25.4 percent this year and a slowdown to 6.7 percent in 2009.

In May the OECD forecast a slowdown of the Angolan economy to 11.5 percent this year and 5.1 percent in 2009.

According to the OECD there will be a slowdown in growth of oil production (…) assuming the country meets its new oil production quota set by OPEC (Organization of Petroleum Exporting Countries), of 1.9 million barrels per day.”

In the report published Wednesday, the BPI said the OECD’s figures were “pessimistic,” despite agreeing that the country’s economic growth had for many years being based on oil, a sector which is getting close to its production potential.

Slower growth, the BPI analysts said, is “more diversified and creates employment,” and therefore, “more favourable for Angola, despite being less impressive.”

The sustainability of the Angolan economy, which is its main challenge, requires precisely a capacity to develop non-oil sectors and job creation, ensuring better distribution of wealth and providing sustained poverty relief,” said analysts Cristina Casalinho, Paula Carvalho and Susana de Jesus Santos.

Portuguese bank BPI controls Banco Fomento, which is Angola’s biggest private bank. (macauhub)