Fáusio Mussá, chief economist at Standard Bank for Angola and Mozambique, was speaking this Wednesday in Luanda during the Economic Briefing in which an overview of the macroeconomic situation and prospects for 2022 was presented, in which he pointed out positive developments and potential risks.
The economist highlighted the reforms that have been adopted in Angola to stabilize the economy as a positive aspect to achieve currency stability, reduce inflation and balance public accounts and said that, for the first time since 2015, oil production should increase by 2.7 percent, reflecting the mobilization of investments in the sector that allowed stabilizing production, which has declined in the last seven years.
He warned, however, of the need to review fuel subsidies after the election year, with more efficient and effective measures that benefit only the most disadvantaged and lower-income groups.
As for inflation, Fáusio Mussá's forecast is for a decline to a level around 16.1 percent at the end of 2022, after a peak of 27.7 percent in January, and a level of 24.4 percent in May."
The economist pointed out as the main reasons for the fall in inflation, the appreciation of the kwanza, which has appreciated 28.2 percent against the US dollar since the beginning of the year, and 49.2 percent in the last 12 months.
The reduction of taxes on essential products and the implementation of a strategic food reserve were other factors invoked.
The official also predicts that within the scope of fiscal consolidation efforts it will be possible to avoid a fiscal deficit this year and expects a strong reduction of the public debt over GDP to low levels of 70 percent, after a recent peak of 129 percent in 2020.
He warned, however, that although at current levels the price of oil is favorable for the national economy, it is necessary to consider volatility and reduce dependence on the oil sector.
Standard Bank is a South African financial institution that has a commercial network of 19 branches in Angola.