According to the detailed analysis of the second review of the country's ongoing Extended Financing Program, the economy is expected to have a new recession of 1.1 per cent instead of previously estimated 0.3 per cent growth and next year is expected to grow by only 1.2 percent, not the 2.8 percent forecast by the IMF in June.
"Economic activity is weaker than expected," IMF technicians admit, pointing out that "relative to the first review projections, growth will be lower in 2019 and 2020 due to lower than expected oil production."
However, they add, "economic activity will gradually recover from 2020 on the back of moderate growth in the non-oil economy," and by 2021 growth will be even higher at around 3 percent, "partly because a lower starting base for oil GDP and the positive effects not only of exchange rate liberalization but also of non-oil GDP".
For next year, the government forecasts GDP growth of 1.8 percent, following a 1.1 percent contraction this year, basing this forecast on the recovery of the oil sector, which is expected to grow 1.5 per cent, and non-oil, which is expected to accelerate from 0.6 per cent this year to 1.9 per cent by 2020.
In the second review of the financial adjustment program, the IMF says Angola's performance has been mixed, but a positive assessment is made not only of the reforms, but also of their impact on the economy and of the government's ability to repay the loan by this multi-sided financial institution.
In the evaluation, it is noted that the Government was able to meet most of the targets and agreed with the IMF on those which it did not meet.
