Angola’s government is preparing for a budget deficit of 1.65% of gross domestic product in 2025, slightly higher than this year’s projected deficit, according to draft budget documents. The budget is based on a $70 a barrel oil price, while futures are currently trading around $74 a barrel.
The finance minister, Vera Daves de Sousa, has expressed concerns about the potential impact of lower oil prices on the country. The draft budget also forecasts economic growth to accelerate to 4.1% next year, with faster growth expected in non-oil sectors.
External financing needs are projected to increase to 7.09 trillion kwanzas ($7.80 billion) in 2025, while internal financing needs are estimated to rise to 7.55 trillion kwanzas. The finance ministry also anticipates a decrease in annual inflation from over 29% to 16.6% next year.
Angola is considering seeking a financing program from the International Monetary Fund, with its most recent program totaling $3.7 billion approved in 2018 after a significant drop in global crude prices severely impacted the country’s revenues.
It is important to monitor Angola’s budget deficit and economic performance as it can have implications for global markets and individual finances. Changes in oil prices and economic growth in Angola can impact various industries and investment opportunities worldwide. Additionally, seeking financial assistance from the IMF may have broader implications for international financial stability.
