The Moody’s credit rating agency has downgraded the sovereign debt rating on Angola from “Ba2” to “B1” with a negative outlook,under the seventh annual evaluation, the Angolan Finance Ministry said Friday in Luanda.
The statement from the ministry is corroborated by a statement from Moody’s about the downward review of Angola’s credit rating because of the “financial position of the government and the country’s external (position) having deteriorated sharply” due to the drop in oil prices.
The rating agency noted that low oil prices are expected to continue, “pressuring” the “economic capacity” of Angola and “significantly reducing the country’s short term growth prospects.”
“The negative outlook reflects the current imbalances in the foreign exchange market that will continue to put downward pressure on official foreign exchange reserves and the currency,” added Moody’s.
In this scenario, the agency estimates economic growth for Angola of 3 percent in 2016 and 2017 and points out that public debt exceeds 50 percent of Gross Domestic Product (GDP) this year, compared to 25 percent in 2013. (macauhub/AO)