"We now expect Angola's budget balance to shift from an estimated deficit of 1.4 percent of GDP in 2020 to a surplus of 0.7 percent in 2021, at the expense of an increase in oil revenues," reads analysis of the evolution of Angola's public accounts.
In the document, sent to investors and to which Lusa had access, the analysts of this consultancy owned by the same owners of the financial rating agency Fitch Ratings recall that "this is an upward revision compared to the previous forecast of a deficit of 0.4 per in 2021, and reflects the view that higher tax revenues will offset an eventual rise in public spending."
In this new scenario, Fitch Solutions sees the surplus widen to 1.4 percent of GDP next year, driven by oil revenues, and also anticipates an improvement in public debt, which is expected to fall from 122 percent of GDP in 2020 to 106.8 percent this year and 97.8 percent in 2022.
"Angola's debt burden will gradually fall with the economic recovery and fiscal consolidation, which help to limit financing needs," analysts point out, concluding, however, that "the debt-to-GDP ratio will remain well above an average of 57.4 percent recorded between 2010 and 2019", not only due to the devaluation of the kwanza, but also due to the country's continued indebtedness.
