Too soon to consider revising State Budget, says Angola’s Finance Minister

6 March 2020

Angola’s Finance Minister, Vera Daves, said on Thursday in Luanda it was still “too soon to consider any scenario to revise the State Budget for 2020,” despite the volatility of the price of oil extracted in the country on the international markets.

The State Budget for 2020 was drawn up on the basis of the price of a barrel of oil of US$55 but recently, due to the COVID-19 outbreak, this price has been in decline, and on Thursday opened at US$51 per barrel.

Vera Daves said that the volatility in the price of oil since mid-2014 has created uncertainty about the country’s main macro-economic indicators, which has forced the Angolan authorities to adopt various mitigation measures, policies that inevitably lead, in the short term, to “economic contraction, through the reduction of public expenditure.”

“Angola is not immune to this reality that affects all oil-exporting countries and it has required us to adopt mitigation measures,” said the minister, quoted by the Angop news agency.

The minister, who spoke at the presentation of the ‘Annual Report of BODIVA Markets (2019),” restated that the drop in oil production and economic activity had a strong impact on the budget in Angola, leading to “a worsening of the deficit and public debt.”

Even so, Angola has managed to “respond to the imbalances generated, to achieve fiscal consolidation, ensuring debt sustainability and supporting the growth and the sustainable development of its economy.”

Given the reality of the market, the Minister said it was important to drive the capital markets segment in the country, as an alternative and complementary channel to finance the Angolan economy.

She noted that the Government considers the capital market to be essential, as a catalyst for economic activity, through the acquisition and application of domestic savings and foreign capital. (macauhub)