Angola Plans to Ditch Currency Peg to Dollar, Restructure Debts

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. Capital Economics estimates that Angola’s total public debt stands at about $75bn, or 63 per cent of gross domestic product. Of this, about $30bn is domestic debt, and $45bn is external (of which roughly $15bn is owed by Sonangol, the state oil company). A raft of African countries took advantage of the post-crisis tumble in borrowing costs for even the riskiest developing countries, issuing international bonds at rates that would have been unthinkable a decade ago.