In an assessment report on Angola released this Thursday, the IMF highlights that controlling inflation remains crucial, recalling that it fell to 27.5 percent in December 2024, after peaking at 30.5 percent in June 2024, mainly due to supply restrictions and exchange rate pressures, with import licensing being one of the main factors in the increase in food prices.
“It is estimated that supply-side cost pressure factors are responsible for more than half of annual inflation,” indicates the document consulted by Lusa.
Recently, the Veterinary Services Institute, part of the Ministry of Agriculture and Forestry, announced that it would stop issuing import licenses for some food products of animal origin, namely poultry offal and parts (chicken and duck), pigs and cattle, as measures to strengthen domestic production and reduce its dependence on the external market.
In its assessment of Angola, the IMF recommends that, in addition to monetary policy measures, priority be given to easing supply constraints to control inflation, despite the authorities insisting that the measures are part of efforts to promote economic diversification, to support domestic production and strengthen food security.
“The authorities estimate that the potential benefits of these policies are higher than those estimated by IMF staff and expect that the increase in domestic food production capacity will minimize consumer prices,” says the international financial institution.
The document was prepared by an IMF team following discussions with the authorities on the country’s economic and political developments between 4 and 17 December.
In the report, the IMF highlights that accelerating medium-term growth requires economic diversification, greater contributions from the private sector and increased fiscal buffers, arguing that the implementation of the 2023-27 National Development Plan would benefit greatly from focusing on market-friendly policies.
“The risks arising from import substitution measures must be carefully assessed to avoid inflationary pressures and distortions in access to essential production factors,” he stresses.
On the other hand, attracting domestic and foreign private investment requires addressing governance vulnerabilities, simplifying business regulation, expanding financial inclusion and resolving property registration issues.
