The International Monetary Fund (IMF) on Wednesday, September 16, approved release of another $1 billion in lending for Angola as its economy struggles with the COVID-19 downturn and global drop in crude prices.
The Washington-based crisis lender also increased by $765 million the size of the 3-year aid program for the southern African nation to help it deal with the pandemic’s impact on the economy, the IMF said in a statement.
Facing high debt levels and inflation, Angola, one of the largest producers of crude in Africa, reached an agreement with the IMF in December 2018 on a $3.7-billion Extended Fund Facility. The latest disbursement brings to $2.5 billion the total released.
Angola has been hard hit by slumping oil prices since the coronavirus pandemic hit, caused by a global slowdown in demand and a price war between major crude producers.
The IMF in July projected Angola would see gross domestic product shrink by 4% this year, its 5th straight year of economic contraction.
“The Angolan authorities remain committed to sound policies under the IMF-supported program despite a deteriorated external environment due to the COVID-19 pandemic, including negative impacts on public health, social protection, the budget, and public debt,” IMF Deputy Managing Director Antoinette Sayeh said in a statement.
“The authorities adopted a conservative supplementary budget for 2020, taking measures to increase non-oil revenue, and reining in non-essential expenditure,” she said. “Despite the crisis, fiscal consolidation will continue, while creating space for adequate spending on health and social safety nets.”