An indelible fact is that 2019 was a tough year. There has never been an economic squeeze such as last year. The belt was nowhere to drill new holes.
During 2019 the staple basket became like a runaway horse, prices skidded to alarming proportions; In some products prices have risen above 50 per cent.
There were increases in light, water and public transport rates. Inflation reached double digits, standing at around 14.7 per cent, the base interest rate (BNA) set at 15 percent making money expensive for those looking to invest, in commercial banks the rate rises above 20 percent. Unemployment soared to 30 percent. Not forgetting, the successive deficits in which the Angolan economy is imbued for almost four years has not grown.
Public debt soared to levels never seen before (over 90 percent). A (im)perfect cocktail that unfortunately is not healthy at all. The President of the Republic João Lourenço was adamant in acknowledging in his year-end speech that “… we will face and overcome difficult situations, derived from an internal and international conjuncture of critical contours”.
However, the challenges ahead for this year (2020), still Herculean, there are a number of measures that will be implemented this year, whose effects have not gone unnoticed, such as:
- Rising fuel prices, which will eventually cascade higher prices for goods and services;
- Updating labor income tax rates;
- Introduction to the Angolan motor vehicle tax system (IVM);
- Capitalization of public banks, estimated to cost state coffers more than two billion dollars;
I hope that the Executive and the Economic Team will be able to prepare a cocktail to relieve the pain that the new “anti-popular” measures may cause not only in the economy, but also in the life and pocket of Angolans.
Measurements and trajectory are irreversible, but if mattresses or pillows are not placed to relieve the impact, the pain will undoubtedly be unbearable.