Angola Economic Forecast

Angola Economic Outlook

November 13, 2018

The economy remained in deep recession in the second quarter as GDP contracted 7.4% in annual terms, a marked deterioration from Q1’s result (Q1: -4.7% yoy). Declining oil production weighed on the all-important oil extraction and refining sector, which in turn likely took a bite out of exports growth. In addition, manufacturing output also weakened in Q2 and, despite ongoing economic reforms pursued by President João Lourenço’s government, incoming data suggests that GDP continued to contract in the third quarter. Oil production slipped again in annual terms in Q3, while a sustained depreciation of the kwanza and elevated inflation weighed on purchasing power, which will likely have dragged on household consumption. Meanwhile, on 26 October the United Nations condemned the Angolan security forces for “serious human rights abuses” following the deportation of over 300,000 Congolese from the country as part of the government’s fight against illegal diamond mining in the country.

Angola Economic Growth

The economy is expected to return to growth next year, supported by improving domestic demand dynamics and rising oil production. Waning inflationary pressures should bolster household consumption, while fixed investment should benefit from more favorable financing conditions amid ongoing economic reforms. However, Angola’s dependence on the volatile oil sector remains the key risk to the outlook. Met the why particular panelists see GDP expanding 2.3% in 2019, up 0.1 percentage points from last month’s forecast, and 2.8% in 2020.

Angola Economy Data

20132014201520162017
Population (million)25.025.826.627.428.2
GDP per capita (USD)5,4615,6484,3343,722-  
GDP (USD bn)137146116111-  
Economic Growth (GDP, annual variation in %)5.04.80.9-2.6-2.5
Consumption (annual variation in %)8.312.73.0-  -  
Investment (annual variation in %)1.63.5-1.9-  -  
Fiscal Balance (% of GDP)0.3-6.6-3.3-4.5-5.3
Public Debt (% of GDP)32.911.764.679.8-  
Money (annual variation in %)17.216.111.813.04.1
Inflation Rate (CPI, annual variation in %, eop)7.77.514.341.926.3
Inflation Rate (CPI, annual variation in %)8.87.311.332.431.7
Exchange Rate (vs USD)97.60112.1135.3165.9165.8
Policy Interest Rate (%)9.259.0011.0016.0018.00
Exchange Rate (vs USD, aop)96.5298.41120.1163.5165.8
Current Account (% of GDP)6.0-2.6-8.9-3.0-  
Current Account Balance (USD bn)8.1-3.7-11.3-3.1-0.9
Trade Balance (USD billion)41.930.612.514.520.4
Exports (USD billion)68.259.233.227.634.4
Imports (USD billion)26.328.620.713.014.0
Exports (annual variation in %)-4.0-13.3-43.9-16.924.7
Imports (annual variation in %)11.18.5-27.6-37.07.1
International Reserves (USD)32.227.724.424.418.0
External Debt (% of GDP)20.624.731.542.6-  

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Angola Facts

ValueChangeDate
Exchange Rate311.60.0 %Nov 15
Stock Market0.10.0 %Nov 13

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