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Economy

NGO: Angola uses two-thirds of tax revenue to pay debt, the highest percentage in the world

Angola is the country that will use a larger percentage of its tax revenue to service debt this year, around two-thirds of the total, according to the non-governmental organization Debt Justice.

:  Angola Image Bank
Angola Image Bank  

Of the list of 84 countries analyzed in a report on debt payments based on total tax revenue expected for 2024 and 2025, Angola will channel 66.4 percent of revenue to pay debt this year, worsening the situation in relation to the 64,7 percent paid last year.

In the table that shows the difficulty of countries in servicing the debt that has increased in recent years, Guinea-Bissau also appears in the top 20, but with a much lower percentage: 23.7 percent and 21.5 percent of the total tax revenue in 2024 and 2025, respectively.

In the report, this NGO does not present concrete figures for the volume of debt, showing only the value as a percentage of tax revenue, but the financial rating agency Fitch Ratings recently wrote that Angola's debt payments will reach almost six billion euros this year. 

Angola will have to pay 6.2 billion dollars in 2025, representing 5.2 percent of GDP, and 5.4 billion dollars in 2026, representing 4.2 percent of GDP, compared to 5.4 billion dollars that the country paid in 2024, says Fitch.

"Low-income countries are expected to have paid an average of 15 percent of their revenues on external debt repayments last year and will spend at least 14 percent this year," says the report by Debt Justice, which advocates debt forgiveness by creditors that allows these economies to finance their development.

According to the World Bank classification, of the group of Portuguese-speaking African countries, only Guinea-Bissau and Mozambique are low-income countries, therefore eligible for concessional financing from various entities, while all the others are in the level of middle-income countries, which automatically makes international financing more expensive.

YEAR...................2024.....2025

Angola...................64.7.....66.4

Guinea-Bissau.........23.7.....21.5

Cape Verde............21.8.....21.4

Mozambique..........14.2.....13.3

Sao Tome and Principe...12.5.....11.1

Amounts as a percentage of tax revenue to pay debt

SOURCE: Debt Justice

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