"We will drastically revise the economic growth forecast and the debt metrics downwards, since we expect economic growth to contract by more than 2 per cent in 2020 and the fiscal and current balance to register deficits, instead of the surpluses that we predicted", reads the analysis sent to customers, and to which Lusa had access.
In the document, Oxford Economics suggested that Angola is facing a kind of 'perfect storm', with the fall in oil prices exacerbated by the price war between Russia and Saudi Arabia, the drastic reduction in international trade and in demand for oil, in addition to the cut in local economic activity due to restrictions on mobility to contain the spread of the new coronavirus.
"While in effect, the closing of borders will have a significant, though perhaps temporary, adverse effect on trade and economic activity and will push up prices due to shortages," the analysts noted.
In the text, analysts recalled that "the oil price war is a devastating blow to the economy, as hydrocarbons are worth 96 percent of exports, about 33 percent of GDP and 60 percent of government revenue", concluding that the support contemplated in the International Monetary Fund's assistance program will not be enough to "save the economy from the consequences of the price war".
On Friday, Angola's Finance Minister, Vera Daves, acknowledged the scale of the problem facing the country, having announced that she would launch an amending budget that includes the price of oil below US$35, compared to the 55 predicted for this year, and that the economy will hardly escape another year of negative growth, also announcing a set of measures to tackle the economic crisis.
