Angola’s finance minister, Vera Daves de Sousa, said today that the country is preparing to issue public debt on international markets again in 2022, even considering going to the markets this year.
“For 2022 it is certain that we want to go to the markets,” the finance minister said during a meeting with journalists this morning in Luanda, in which she also pointed to the possibility of making a debt issue this year if there are positive conditions.
“For 2022, regardless of the issue of the active debt of our portfolio, we want to go and issue a new issue to the market and we are preparing the debt plan for 2022 with that in mind,” she said.
Angola’s last debt issue was made at the end of 2019, and since then the country has been aloof from the financial markets, not only due to the high interest rates demanded by investors in a pandemic context, but also due to the financial support that the International Monetary Fund and other partners have given the country.
During the meeting with the media, Vera Daves de Sousa explained that the government has a conservative stance on debt, and is proactively managing for cheaper financing that can progressively reduce the volume of debt.
The ratio of debt to GDP has risen significantly in recent years, not so much because of the issue of new debt, but because of the devaluation of the kwanza and the effective reduction of GDP, given the recession of the last five years, which is likely to continue this year.
The International Monetary Fund (IMF) worsened the growth forecast for Angola in the latest report on sub-Saharan Africa, released in October, and now anticipates a recession of 0.7%, the sixth consecutive annual decline in the country’s wealth, which is expected to grow 2.4% in 2022.
Public debt, in turn, will continue this year above 100% of GDP, falling from 136.5% last year to 103.7% this year and 90.8% in 2022, which contrasts with the government’s 85% forecast for this year.
The State Budget proposal for 2022 was approved in general terms on November 9th and will now be discussed in special terms.
