IMF warns of ‘tough period’ for Angola in 2015

The Angolan government’s proposal to revise the State Budget for 2015 due to the significant decline in oil prices was “timely and fast,” the head of a mission from the International Monetary Fund said in Luanda.
Ricardo Velloso said, however, that Angola will experience a “tough period” this year, as a result of the drop in the price of oil per barrel, but added the economy needed to be adjusted tax-wise.
The IMF team met with the ministers of the Angolan government’s economic team, which is made up of Finance Minister, Armando Manuel, the Minister of the Economy, Abraão Gourgel, Minister of Planning, Job Graça and the governor of the National Bank Angola, José Pedro de Morais.
This is the fourth visit by an IMF team to Angola in less than a year, this time to prepare the annual consultation under Article IV of the Establishing Agreement with the IMF, to be held early in the second half of 2015.
This visit is taking place during the revision process of this year’s amended budget, driven by the fall in the international price of oil, which has already been handed in to the country’s parliament.
The amended budget cuts expenditure by over 25 percent and revises the expected price of oil exports from USD81 to US$40.
To offset the effects of the decline in oil prices on the Angolan economy, the IMF recently suggested the elimination from this year, of state subsidies on gasoline and the phased reduction by 2020 of subsidies on other fuels.  MDT/Macauhub