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Sat, 19 Sep 2020 11:11 - Updated Sat, 19 Sep 2020 11:11

Angola to save USD 6 bln in debt negotiation

Luanda - Angola expects to save USD 6 billion until June 2023 in public debt with creditors within and outside the G20, Finance minister Vera Daves said on Friday.

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Minister of Finance Vera Daves

Photo: Francisco Miudo

Minister of finace, Vera Daves

Photo: Francisco Miudo

In July, the minister predicted USD 66 billion stock in public debt by the end of 2020, with a ratio of GDP standing at above 100%.

Vera Daves, who was speaking at a press conference led by the minister of State and Economic Coordination, Manuel Júnior, spoke of a debt stock of around 123percent of GDP by the end of the year.

The minister acknowledged the solidarity of multilateral and bilateral partners who, due to the pressure and consequences of covid-19 in Angolan economy, agreed to negotiate a debt reform process to the country to save USD 6 billion by 2023.

“In addition to continue honouring debt service, the savings will help adopt preventive measures to rein covid-19 and place the State in a better position to continue spending money on social inclusion projects and economic”, the minister said.

Despite this solidarity from creditors, the minister said the country will continue  committed to fiscal consolidation, as the situation of public accounts remains delicate.

She said the commitment to fiscal consolidation should be maintained through the widening of the tax base to ensure more revenues, through the expenditure quality, responsible loan to reduce the stock of public debt, that might reach around 123 % of GDP by the end of the year.

According to the minister, Angola's public debt is sustainable.

In December 2018, the director general of the International Monetary Fund (IMF), Christine Lagard, also made the similar statement and said that the public debt would be estimated at 70% of GDP.

“Angola's public debt is sustainable despite ongoing pressure, the official said, stressing that fiscal consolidation measures will continue to be developed so that sustainability become even stronger and ensures signs of tranquility in the medium and long term deadline.

As for the tough period the Angolan economy is going through, Vera Daves recognised the families and companies sacrifices, which she considered resilient.

The press conference was attended by the Minister of Planning and Economy Sérgio Santos, and the governor of the National Bank of Angola (BNA) Massano Júnior.

The Government of Angola-IMF meeting culminated with the approval (Wednesday) of increasing financial assistance to USD 4.5 billion and the immediate disbursement of USD 1 billion.

Angola, an IMF member country since 1989, benefited from the first USD 1.4 billion financing from this Breton Wood institution in 2009, under the "Stand By" agreement.

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