The IMF "concluded today [Monday] the fourth revision of Angola's economic program, supported by an extended agreement under the Extended Financing Mechanism", which "allows an immediate disbursement of (...) 487.5 million , bringing the total disbursements under the agreement to (...) around three billion [dollars], can be read in the statement.
The three-year agreement extended to Angola was approved on December 7, 2018, in the amount of about US $ 3.7 billion, to restore external and fiscal sustainability, improve governance, and diversify the economy to promote growth sustainable economic development, led by the private sector.
At the third review, the IMF also approved the authorities 'request for an increase of $ 765 million to support the authorities' efforts to mitigate the impact of covid-19 and support the implementation of structural reform.
Now, the IMF has stressed that "the multifaceted nature of the covid-19 shock continues to have a negative impact on Angola's economy and population" and that "oil production and prices remain weak".
However, the Washington-based United States institution stressed that the authorities "achieved a prudent fiscal adjustment in 2020 that included gains in non-oil revenues and containment in non-essential expenditures, while preserving essential expenditures on health and safety networks. and "the approval of the 2021 budget in December consolidates these gains".
On the other hand, in this fourth review it was also pointed out that "the authorities also allowed the exchange rate to act as a shock absorber and began to implement a gradual change towards a monetary tightening to face the increase in price pressures ".
The institution led by Kristalina Georgieva "also approved today [Monday] the authorities' request for derogations from applicability and non-compliance with performance criteria and modification of some performance criteria, indicative objectives, and structural benchmarks," announced the IMF, without further details.
Deputy Director-General Antoinette Sayeh stressed that, "despite the challenges of the pandemic (...), the authorities have shown a strong commitment to sound policies within the framework of the agreement supported by the IMF" and that the country's response "allowed Angola to resist major external shocks, especially lower oil revenues, and mitigate its macroeconomic impact, while protecting the most vulnerable ".
The same official said that "the stabilization of public finances remains the cornerstone of the authorities' strategy", which "achieved a strong fiscal adjustment in 2020", but warned that "continued progress in financial sector reforms is critical, particularly the completion of the restructuring of the two public banks in difficulty ".
On the other hand, she concluded, "the authorities also need to maintain momentum for other structural reforms that support stronger and more diversified growth, strengthen governance, and fight corruption".
