Services, industry and agriculture sustain Angola’s economic recovery in 2010 and 2011

22 February 2010

Luanda, Angola, 22 Feb – The Angolan economy will again grow in 2010 and 2011, after stagnating last year, and the biggest growth contribution will come from the services, industry and agriculture sectors, indicates a report from the Catholic University of Angola.

The Angola Economic Report recently released by the university’s study centre paints an optimistic picture of the coming years, as other economic analysis groups have done. It forecasts growth of 7.1 percent this year and 8.5 percent next year.

The growth of oil-related GDP will be 6.7 percent in 2010, while for non-oil GDP the figure will be 9.5 percent.

In 2011 this tendency to reduce oil’s influence on the economy should be accentuated, with oil-related GDP growing 3.1 percent and non-oil GDP 11.2 percent, according to the Angolan university’s projections.

In the next two years the most dynamic sectors of the Angolan economy will be commerce, tourism, the transformation industry, transport and agro-industry, the study centre indicates.

This impulse results from public investments and the economic diversification trend promoted by Angolan authorities with a view to reducing dependence on oil, as evident in the falling tax revenues and external reserves caused by the sharp drop in related prices at the end of 2008 and first quarter of 2009.

The latest World Bank forecasts indicate that the Angolan economy should grow by 6.5 percent in 2010 and 8.0 percent in 2011, after shrinking by 0.9 percent in 2009.

Last year “the Angolan economy had a weak performance, with oil exports falling below 1.8 million barrels per day – lower oil revenues led the government to make cuts in investment spending and private consumption contracted,” the World Bank notes in its January report.

Economists from Portugal’s BPI bank have also revised upward the forecasts for Angolan economic growth, reflecting improved external conditions and also Luanda’s access to new financing lines such as the one from the International Monetary Fund (US$900 million).

“The movement towards economic recovery visible in the second half of the year, driven by improved revenues (price and quantity) from oil exports, helped offset the fall in international reserves,” the most recent BPI report notes.

As for inflation, the Catholic University envisages a rate between 10 and 12 percent the year, dropping to between 9.7 and 11.4 percent in 2011.

Government figures indicate that Angola’s gross domestic product grew at an average annual rate of 9 percent in the last 19 years. (macauhub)