IMF approves $487.5m disbursement to Angola

WASHINGTON - The International Monetary Fund said on Monday its executive board approved a disbursement to Angola of about $487.5 million after completing a fourth review of the African oil exporter’s $3.7 billion loan programme.

The Fund said that the Covid-19 pandemic continues to impact Angola’s economy and population, while oil production and prices remain weak.

But it said that Angolan authorities “have maintained a robust policy response in the face of these challenges and remain resolutely committed to the programme,” noting the December passage of a 2021 budget that includes non-oil revenue gains and restraints on non-essential expenditures.

Angola’s Finance Minister, Vera Daves de Sousa, told the Reuters Next conference on Monday that she expected more than $700 million in the next IMF tranche after securing three years of payment relief from Chinese creditors.

Angola owes more than $20 billion to a number of Chinese entities, including $14.5 billion to the China Development Bank and nearly $5 billion to the Export-Import Bank of China. It has also borrowed from China’s largest lender, ICBC, according to analysts’ calculations.

“We’ve got three years of breathing space and we will take the best advantage of that,” Vera Daves de Sousa said in an interview for the Reuters Next conference.

Angola had been transparent with the IMF on its negotiations with the Chinese, she said.

Angola last September secured a $765 million augmentation of total access under the Extended Fund Facility programme, which was initially approved in December 2018.

“The stabilisation of public finances remains the cornerstone of the (Angolan) authorities’ strategy,” IMF Deputy Managing Director Antoinette Sayeh said in a statement.

“The authorities achieved strong fiscal adjustment in 2020. Their 2021 budget consolidates the non-oil revenue gains and expenditure restraint of the 2020 budget, while protecting priority health and social spending.”