Angola returns to markets this quarter and issues 2.8 billion dollars

According to the document, dated 8 February and consulted this Thursday by Lusa, Angola expects to raise US$10.74 million this year, of which up to US$2.8 billion are expected to be raised in international markets. through the issuance of debt in foreign currency (Eurobond).

Angola is thus preparing to issue debt again for the first time since 2019, and after having planned to issue a new issuance at the end of last year, while the International Monetary Fund (IMF) financial assistance program is in effect.

The country, the second oil producer in sub-Saharan Africa, also plans to contract international loans and financing from commercial, bilateral and concessional entities in the amount of 2 billion kwanzas, equivalent to US$3.18 billion.

Domestically, Angola expects to borrow US$4.76 billion, divided into US$320 million in contractual debt and US$4.44 billion in securitized debt.

In order to "mitigate the risks inherent to the debt", Angola plans to "prioritize concessional financing, favor medium and long-term instruments, limit the granting of public guarantees, the possibility of early redemption of indexed securities, reduction of the stock of indexed securities and of debt guaranteed with oil and the smoothing of external debt maturities, through the preventive restructuring process".

Among the main constraints, the indebtedness plan points out the "considerable commitment of tax revenues in the payment of government debt service, the difficulty in raising funds as a result of the current contractionary monetary policy, the preference of the main investors in the domestic market, commercial banks , in allocating its liquidity in currency auctions, and the difficulty in obtaining new financing due to exposure to country risk".

The Government expects to reach the end of this year with public debt at 73 percent of GDP, reducing the debt-to-GDP ratio by 12 percentage points, which should have closed at 85 percent in 2021.