Angola pays debts to Brazil ahead of schedule

10 December 2019

The Angolan government has paid its debt of US$589 million to Brazil ahead of schedule in an operation carried out on 3 December, Brazil’s Ministry of Economy said in a recent announcement.

The statement added that the payment settled all financing agreements with the Brazilian National Treasury and the National Bank of Economic and Social Development (BNDES), which matured in 2024.

In the recent financial relationship between the governments of the two countries, Angola’s total debt to Brazil reached US$5.0 billion, and the two countries signed six memoranda of understanding between 2005 and 2017 to increase the amounts of funding for Brazilian exports, backed by oil guarantees by the Angolan government.

The BNDES financed 84 operations in Angola that totalled US$4.4 billion, through a Finame credit line, which were guaranteed by the federal government through Export Credit Insurance, and the balance now paid totalled approximately US$581 million.

The National Treasury channelled resources from the PROEX financing line (which has the Bank of Brazil as the financial agent) for a total of 37 operations in Angola, with disbursements totalling US$628.5 million. The outstanding balance for the last four operations was approximately US$8.3 million.

The situation with Mozambique is different, with the Brazilian government being forced to bear the debt not paid by Mozambique related to Nacala International Airport, which was built by Brazil’s Odebrecht Group with funding from Brazil’s BNDES bank.

The airport, whose construction cost US$125 million, has the capacity to receive 500,000 passengers per year, but that figure is no more than 20,000, according to figures reported in April by the Mozambican press.

International flights never arrived at the airport and the flights that do are two regular domestic flights of state airline LAM on the Maputo-Nacala route and two private flights of mining company Vale Moçambique, all operated with the aircraft of Brazilian aeronautical manufacturer Embraer. (macauhub)