Angola is hoping sweeping economic reforms will smooth an ambitious plan to sell key state assets, including stakes in oil company Sonangol, a share of Puma Energy and more than 100 other enterprises. Africa’s second biggest oil exporter is in a rush for cash as it struggles to cope with moribund crude prices, slumping output and years of mismanagement that left Sonangol bloated and inefficient, Reuters reported. In August, the government published an extensive list of assets that will be offered to investors via public offerings, stake sales, asset sales or tenders.
Angola
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Angola has asked the IMF for talks on a bailout in return for more structural reform in Africa’s second-biggest crude exporter, the Financial Times reported. The IMF confirmed on Tuesday that Angola’s government under President João Lourenço asked “to initiate discussions on an economic programme” supported by bailout loans. The fund “stands ready to help the authorities address Angola’s economic challenges by supporting their economic policies and reforms”, it added.
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As Angola seeks to attract foreign investors to help diversify its oil-dependent economy, the country’s biggest trading partner, China, looks set to take a leading role, but the considerable leverage it is able to wield may leave Africa’s third-largest economy short-changed, the Financial Times reported. With Angola heavily indebted to China, Beijing may drive some hard bargains, as has happened in south Asian countries deeply in hock to the Chinese.
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The former Angolan president’s son and a former central banker are suspected of using accounts at HSBC Holdings PLC and Standard Chartered PLC in an attempt to defraud the country’s central bank by transferring $500 million through these U.K.-based lenders, people familiar with the matter said. The prosecutor’s office in Angola said the money was transferred from Angola’s central bank, allegedly to guarantee a $30 billion financing deal, according to a statement posted on the government website Wednesday, The Wall Street Journal reported.
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The oil price has hit $70 a barrel, its highest level in more than three years, but that’s not proving much help for a country which generates 95 per cent of its foreign earnings from petrodollars. Angola, sub-Saharan Africa’s third-largest economy, began 2018 by scrapping the peg its currency, the kwanza, has with the dollar and warning of a potential renegotiation of its $40bn in external debt, the Financial Times reported.
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Angola has announced plans to ditch its currency peg to the dollar and restructure its debts, becoming the latest previously high-flying African country to bite the default bullet, the Financial Times reported. Jose de Lima Massano, the central bank governor, and Archer Mangueira, the country’s finance minister, announced at a press conference on Wednesday that Angola – the continent’s second-biggest oil exporter after Nigeria – would have to shift to a currency trading band and “renegotiate” its debts, according to wire reports.
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Angola will turn to the International Monetary Fund for a bailout to help cope with the oil-price rout that has hit its economy hard, joining a growing list of commodity-dependent African economies seeking assistance from the institution to weather the adverse economic climate, The Wall Street Journal reported. The announcement represents an about-face for a government that had previously rejected the idea of seeking IMF assistance and ends months of speculation over how the West African country will cope with a looming financial crisis on the back of record-low oil prices.
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Angola, facing economic and political pressures, has cut spending under its 2016 budget by 20% and is reassuring international investors it can cope with persistently low oil prices, Finance Minister Armando Manuel said Monday, The Wall Street Journal reported. Mr. Manuel said the surprise announcement Friday by President José Eduardo dos Santos to step down in 2018 shouldn’t concern the country’s foreign investors, and is part of “a normal process.” Mr. dos Santos has governed the Atlantic coast nation since 1979 and didn’t lay out a succession plan for the next leader of his party.
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Angola’s central bank has pledged to tighten financial regulation and step up anti-money laundering measures after two international banks halted US dollar supplies to the southern African nation. Bank of America and Standard Chartered decided to stop supplying greenbacks to Angolan banks late last year, apparently over concerns about lax regulation. The oil-dependent nation was one of Africa’s fastest growing economies over the last decade, but it is now grappling with the collapse in crude prices, which has led to a shortage of dollars in the economy.
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The oil boom that turned this Atlantic coast city into the world’s most expensive for foreigners has gone bust, threatening President José Eduardo dos Santos’s long grip on power in Africa’s second-biggest crude producer, The Wall Street Journal reported. Property prices have plummeted by half and Western oil companies are laying off thousands; U.S. dollars and steady work have become scarce. Angola’s troubles threaten to reverberate as far away as Beijing, the regime’s sponsor and top crude customer.
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