"At Fitch Solutions, we anticipate that Angola's real Gross Domestic Product (GDP) will contract 1.5 percent this year, before growing 2.7 percent in 2022, which is a downward revision to our forecast growth of 1.7 percent this year and 3.3 percent in 2022", reads a note sent to customers.
In updating the forecast, which Lusa had access to, the consultant owned by the same owners of the financial rating agency Fitch Ratings justifies the revision with "new forecasts on oil production" in Angola, the second largest producer in sub-Saharan Africa.
Fitch Solutions has downgraded its forecast for oil production in Angola, now estimating that the country will pump 1.25 million barrels a day this year and 1.31 million in 2022, which contrasts with the previous forecast of 1.33 million this year and 1.43 million next year.
"This is due to the Government's expectation that some projects will come into operation in the second half of this year, which may provide modest support for production, which is in difficulties," argue Fitch analysts.
In 2022, the new projects of TotalEnergies and BP, which were postponed due to the effects of the covid-19 pandemic, will help make production recover, concludes in the note from Fitch Solutions.
In addition to the downward revision for this year, which makes Angola face the sixth consecutive year of recession since 2016, Fitch Solutions also points out that the economy's growth average will be consistently below the region's growth average until the end of this decade.
"Angola's GDP will grow 2.6 percent on average between 2021 and 2030, below the 10-year average for sub-Saharan Africa, which is 3.7 percent, due to the chronic underinvestment in aging oil wells, which has been an irreversible effect on the country's oil sector, and Angola will hardly be able to return to the levels of 1.5 million barrels per day registered before the pandemic", conclude the analysts.
Fitch Solutions' new forecast comes days after the International Monetary Fund revised Angola's growth estimate downwards, pointing to a 0.7 percent recession, and also at the same time that the government lowered the forecast to a value close to zero, with the finance minister admitting that a new recession this year is possible.
