The International Monetary Fund slashed Angola’s 2025 growth forecast to 2.1% from 2.4%, citing weaker oil exports and mounting financial pressures. IMF officials warned that Angola faces rising risks to its debt repayment capacity, urging the government to limit borrowing and cut expenditures. Greater flexibility in the foreign exchange rate is also essential, the Fund said, as it released findings from a May assessment mission to Luanda.
The Fund noted Angola has been buffeted by volatile oil prices, weak oil production, and global market shocks, amplifying economic vulnerability this year. U.S. trade tariffs have roiled financial markets, further complicating life for small, oil-dependent African economies like Angola, the IMF added.
Debt repayment capacity remains “adequate,” yet the IMF cautioned against excessive domestic borrowing or costly short-term external debt that could strain finances. Too much domestic financing could raise banks’ sovereign exposure, while short-term external debt risks accumulating onerous obligations and scaring off investors.
In April, Angola paid $200 million to JPMorgan due to a bond price drop, though the government later received a refund after prices recovered. The IMF mission, a Post Financing Assessment, targeted nations with credit above quotas lacking an IMF-supported program, reviewing Angola’s fiscal and external vulnerabilities.
Officials said Angola faces potential crude oil price declines, tighter external financing, and must reduce oil-backed loans to China to ease financial pressures. The Fund urged the government to act decisively, balancing fiscal restraint with careful management of debt, markets, and energy-dependent revenues.