Ver Angola


Angola to join G20 initiative to suspend debt payments

Angola will join the G20 Debt Service Suspension Initiative (DSSI), the Ministry of Finance announced this Tuesday, arguing that this will allow it to direct funds to combat the impact of covid-19.

:  Angola Image Bank
Angola Image Bank  

"In consultation with the IMF, the Ministry of Finance decided to resort to the G20 DSSI to negotiate with its sovereign peers the paralysis of debt service in bilateral loans", reads a statement sent to Lusa, in which it is argued that "the DSSI could ease the financial pressure and allow the liberalization of funds to combat the effect of covid-19 in Angola in the coming months".

In the statement, the Ministry of Finance does not say what the amounts involved are, stressing that the renegotiation of the debt focuses on the amounts owed to bilateral creditors included in the agreement proposed by the G20, which excludes private creditors.

"Following the already announced reforms of public administration and budgetary adjustments, the Ministry of Finance is currently in an advanced stage of negotiations with some of its oil importing partners to reschedule financing facilities to better reflect the current market environment and the production quotas of the Organization of Petroleum Exporting Countries (OPEC) ", he adds in the note.

The released text also states that "the Ministry of Finance considers that, thanks to the measures mentioned above and in cooperation with the IMF [International Monetary Fund] and its multilateral partners, it is on the right path to guarantee the necessary emergency aid for the country to 2020 and long-term macro-financial stability for the years to come ".

On the other hand, it concludes that it does not foresee the "need to proceed with the renegotiation of debt with creditors in addition to those already in progress", which suggests that the Government intends to honor debt payments to private creditors and support payments by coupons of public debt issues in foreign currency (Eurobonds).

The assumption of the debt problem as a central issue for African governments was well reflected in the concern that the International Monetary Fund and the World Bank dedicated to this issue during the Annual Meetings, which take place in April in Washington, in which they made funds available and agreed a moratorium on paying the debts of the countries most vulnerable to these institutions.

On April 15, the G20, the group of the 20 most industrialized nations, also agreed to suspend US $ 20 billion, about € 18.2 million, in bilateral debt for the poorest countries, many of which are African, by the end of the year, challenging private creditors to join the initiative.


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