Angola Growth Revised Upwards

Angola’s economy is expected to grow by 2.2% this year and 2.4% in 2019, up by 0.6 percentage points and one percentage point than forecast in the World Economic Outlook for October 2017, the International Monetary Fund announced in Washington.

The IMF, which held its Spring Meetings this week, said the upward review of real growth rates is based on rising oil prices, “which increase disposable income and improve economic sentiment,” AllAfrica reported.

Angola, whose economy posted real economic growth of 0.7% in 2017, is expected to register real growth of 4% by 2023, according to IMF forecasts.

Mozambique, for its part, is expected to have lower economic growth this year and 2019, with real rates of 3% and 2.5%, respectively, before accelerating to 9.9% in 2023, based on projections that natural gas exploration projects will already be generating significant revenues.

The estimate for the growth of the Mozambican economy represents a downward review from the 5.3% expected by the IMF in October last year that Mozambique would post growth this year, as well as in 2023, with a drop from 14% to 9.9%.

Cape Verde’s economy is expected to record a constant growth rate in the three years under analysis—4.3% this year and 4% in 2019 and 2023.

Economic growth in Sao Tome and Principe and Guinea-Bissau is expected to fluctuate between 5% and 5.5%, the World Economic Outlook said.

Meanwhile, Africa’s second-largest oil producer Angola is seeking non-financial assistance from the IMF to help it with reforms aimed at revitalizing the economy that has suffered from low oil prices.

OPEC member Angola has requested an agreement, known as a Policy Coordination Instrument, to help it implement a macroeconomic plan of the new Angolan government, the African country’s finance ministry said last week.

The agreement with the IMF “will help to improve the external credibility of our country with positive impact on the ability to attract foreign direct investment,” the finance ministry’s statement said.

Angola’s new president Joao Lourenco—who succeeded Jose Eduardo dos Santos at the end of his 38-year-long rule in September—has vowed to turn around the economy and open it to foreign investment to diversify away from oil, which currently makes up 90% of the country’s export revenues.