Angolan economy grows 2.2% after three years of recession
After three years of recession, Angola, one of Portugal’s biggest international clients, is seeing economic recovery.
The analysis department of international ratings agency Fitch – Fitch Solutions – forecast on Wednesday that Angola’s growth will achieve 2.2% in 2019 after having suffered a contraction of 0.8% of GDP in 2018 – the third consecutive year of recession.
“We are forecasting an increase in production in oil, Angola’s main export, which will raise real GDP growth from -0.8% in 2018 to 2.2% this year”, say Fitch analysts
“The recession that has lasted three years was triggered by the fall in oil prices and reduction in oil production with the sector seeing a significant deterioration in assets quality, with a ratio of loan default at 26.7% in November last year” says the Fitch report.
This compared to an average default of 10.4% registered between 2014 and 2016” states the report sent to investors.
On Tuesday the Angolan government announced that it would proceed with a review of its General State Budget for this year “in the first quarter” owing to the “downward trend” of per barrel of oil which continues to be below Government forecasts $US68.
Today the price of a barrel of oil is fetching around $US60 on the international markets.
According to data from the Portuguese National Statistics Institute (INE), exports and sales to Portugal from Angola between January and July 2018 totalled €600 million, representing an increase of 416% on the €116 million of goods sold by Angola to Portugal in the first seven months of 2017.
Exports to Angola from Portugal have gone from €1.2Bn in 2006, to €2.2Bn in 2009, falling to €1.9Bn in 2010 and climbing to their maximum level of €3.1Bn in 2014.
Sales to Angola fell dramatically from 809 million in 2016 and €278 million in 2017. In 2014 there were 9,431 exporting Portuguese companies in Angola, a number that fell to 5,838 last year — a far cry from the 9,400 registered in 2013. Angola is currently Portugal’s 9th most important trading partner $2Bn (3.3%).
