Africa-Press – Angola. The economic research office of Banco Fomento Angola (BFA) predicts that the growth of the Angolan economy will slow to 4% this year, with inflation remaining above 20% for the year as a whole.
“By 2025, the economy is expected to grow again, but at a slower level than in the previous year; there are many challenges ahead, mainly due to deep structural issues; our expectation is for growth of around 4%, still heavily leveraged by the impact of the increase in diamond production, particularly due to the restart of operations at the Luele mine at the end of 2023 and the increase in operations”, write the analysts in a commentary on the evolution of the Angolan economy.
In the document, sent to clients and to which Lusa had access, BFA says that the numbers “will be less positive in terms of private consumption, so sectors such as Commerce should grow below average, but there are still positive signs regarding financing, which will have a major impact on the evolution of the Construction sector”.
Regarding inflation, which is one of the highest in Africa, the BFA economic studies office predicts that price increases will remain high, reaching 21 to 22% by the end of the year.
“Our projection indicates a slight acceleration in the second quarter, fuelled by the increase in the price of diesel, in a context of gradual withdrawal of fuel subsidies, by the effects of wage adjustments in the public sector and by the evolution of food prices at international level”, they point out, noting that, even so, there should be a slowdown as the year approaches the end.
The BFA’s forecasts come at the same time that the International Monetary Fund and the World Bank revised downwards their growth forecast for Angola, with the IMF now predicting an expansion of 2.4%, compared to the 2.8% that, in October, it predicted Angola would grow this year.
The World Bank now predicts that the second largest oil producer in sub-Saharan Africa will grow by just 2.7%, when in October 2024 it predicted an expansion of 2.9%, and is also making a strong revision of inflation, whose forecast six months ago pointed to 16.1%, and is now 25%, being one of the 14 countries among the 47 in the region that have double-digit inflation.
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