Angola’s economy is expected to expand by 3.2% this year and 2.9% in 2025, after growing by 1.0% last year, according to the World Bank, which predicts that the economies of all Africa’s other Portuguese-language countries will also grow in 2024.
“In Angola, growth is expected to accelerate from 1% in 2023 to 3.2% in 2024,” reads the Africa Pulse report, released on Monday in Washington as part of the Annual Meetings of the World Bank and the International Monetary Fund, which are taking place this month in the US capital.
The acceleration in growth of economic activity this year in Angola was, the bank’s economists say, underpinned by the “improvement of bottlenecks that strangle the increase in oil production, such as suspensions of exploration for maintenance of the main wells” – although they point out that the prospects for growth in the medium term are still limited.
“Growth prospects for 2025 and 2026 are still limited by the slow implementation of structural reforms that could foster economic diversification,” reads the report, which presents good news for consumers in terms of price developments.
“Inflation is expected to peak this year, with inflationary pressures gradually falling in 2025 and 2026, thanks to the tightening of monetary policy and fiscal consolidation,” says the World Bank in the report, which forecasts a reduction in inflation from 27.4% this year to 16.1% in 2025.
The report also presents forecasts for all the countries in sub-Saharan Africa, a region that the World Bank predicts will grow by 3% this year and 4% the following year.
The only major variation in terms of growth in gross domestic product is seen in Equatorial Guinea, which after having been in recession last year, with a contraction of 5.7%, is expected to record an expansion of 4.7% in GDP this year, before going back into the recession in 2025, with GDP expected to shrink by 4.4%.
Questioned by Lusa about these fluctuations, the World Bank replied that this year’s growth in the country “is underpinned by a recovery in the hydrocarbon sector thanks to repairs to platforms that have recently suffered incidents” – but confirmed that a fresh recession is expected in the coming years.
“Without strong structural reforms and substantial new hydrocarbon discoveries, average annual growth for 2025 and 2026 is expected to be -2.6%, mainly reflecting the decline in oil production,” adds the World Bank in its response to Lusa on the reasons for the oscillations in the growth of the most recent economy in the Lusophone space.
To prevent these variations and “contain a long-term economic decline, structural reforms are needed to diversify the sources of growth, and it is also necessary to create budgetary stability through efforts to mobilise domestic revenue and more efficient public spending,” the World Bank economists add.
According to data from this development finance institution, Equatorial Guinea had an average GDP shrinkage of 3.3% between 2010 and 2019, then recorded a still deeper recession in 2020, with GDP down 4.8%, in the first year of the Covid-19 pandemic. Growth recovered in the following two years, with rates of 0.9% and 3.7%, before sinking back into a recession of 5.7% last year.
