World Bank: Angola grows 3.2 percent this year and inflation falls from 2025

"In Angola, growth is expected to accelerate from 1 percent in 2023 to 3.2 percent in 2024", reads the Pulsar de África report, released this Monday in Washington, within the scope of the World Bank Annual Meetings and of the International Monetary Fund (IMF), which take place this month in the North American capital.

The acceleration of growth in economic activity this year in Angola was sustained by "the improvement of bottlenecks that strangle the increase in oil production, such as suspensions of exploration for maintenance of the main wells", say World Bank economists, pointing out, however, that medium-term growth prospects are still limited.

"Growth prospects for 2025 and 2026 are still limited by the slow implementation of structural reforms that could foster economic diversification," says the report, which presents good news for families with regard to price developments.

"Inflation is expected to peak this year, with inflationary pressures gradually falling in 2025 and 2026, thanks to tightening monetary policy and fiscal consolidation," says the World Bank in the report, which predicts a reduction in inflation of 27.4 percent this year, to 16.1 percent in 2025.

The report also presents forecasts for all countries in sub-Saharan Africa, a region that the World Bank predicts will grow 3 percent this year and 4 percent the following year.

The only major variation in terms of GDP evolution is recorded in Equatorial Guinea, which after being in recession last year, with a contraction of 5.7 percent, is expected to record an expansion of 4.7 percent of GDP this year, then returning to 'red' in 2025, the year in which GDP is expected to fall by 4.4 percent.

When asked by Lusa about these fluctuations, the World Bank responded that this year's growth "is based on a recovery in the hydrocarbon sector thanks to repairs on platforms that have recently suffered incidents", but confirmed that a new recession is expected in the coming years.

"Without strong structural reforms, and substantial new hydrocarbon discoveries, average annual growth for 2025 and 2026 is expected to be -2.6 percent, mainly reflecting the decline in oil production," adds the World Bank in its response to Lusa on the reasons for the fluctuations in the growth of the most recent economy in the Portuguese-speaking space.

To prevent these variations and "contain a long-term economic decline, structural reforms are needed that diversify the sources of growth, and it is also necessary to create fiscal stability through efforts to mobilize domestic revenue and more efficient public spending", World Bank economists also add.

According to data from this development financial institution, Equatorial Guinea had an average growth of -3.3 percent between 2010 and 2019, then recording a recession of 4.8 percent in 2020, the first year of the covid-19 pandemic, and recovering in the following two years, in which it recorded economic expansions of 0.9 percent and 3.7 percent, before sinking back into a 5.7 percent recession last year.