World Bank advises “prudence” in improvements seen in Angolan economy

23 October 2009

Luanda, Angola, 23 Oct – The current situation of the Angolan economy allows for “cautious optimism” under “continued prudence” in managing macroeconomic policies, thanks to a rise in the price of oil on the international market, the World Bank said.

In its October monthly report, signed by the World Bank chief economist in Angola, Ricardo Gazel, the bank said that the country’s economy had improved since the September report, mainly due to a “recovery in the price of oil.”

For this, Gazel noted, there had been a significant contribution from the fact that the price of Girassol crude oil, a benchmark for Angola, had recovered 68 percent against December 2007, despite still remaining 30 percent below the year-ago figures and 48 percent below the peak seen in July 2008.

“In the last three months of 2009, the average benchmark price for Angola is expected to be higher than the average price for the same period of 2008, whilst production has also seen a substantial rise (…) with average daily production of 1.859 million barrels,” the World Bank said.

These figures, Gazel noted, show a rise of 13 percent against the lowest point (1.646 million barrels per day) in February.”

This implied, the economist said, a rise in tax revenues of US$840 million in thefirst four months of the year, to US$1 billion in the second four months, up to US$1.6 billion in the next two months.

To sum up, the economist noted, tax revenues from oil “doubled in August and September, compared with the first three months of the year, resulting in an important boost to the government’s tax collection,” namely in terms of stabilising foreign reserves. (macauhub)