Africa-Press – Angola. The national currency – the Kwanza, appreciated 23 percent against the US currency, with the dollar costing 449.80 kwanzas at the end of March, when on 1 January it was worth 554.90 kwanzas.
According to Lusa’s analysis of the official Kwanza exchange rates, the Angolan currency has experienced a consistent appreciation since the beginning of the year. According to the Lusa agency, this recovery has been driven by the rise in oil prices and has had several positive implications for the country’s economic indicators.
In an interview with the financial information agency Bloomberg, in mid-March, the governor of the National Bank of Angola (BNA), José de Lima Massano, admitted that the current value, around 450 kwanzas per dollar, “is balanced; we have been witnessing an increase in confidence in the currency, generating considerable gains for the Kwanza”.
The governor confirmed that the balance of the Kwanza had been restored, referring to the difference that existed between the price of the currency in the formal and informal market, with a difference that could go up to 150 percent, “but which is now practically nullified”.
The Kwanza is gaining in value, due to the improved forecast of the evolution of Angola’s economy and the partial liberalization of the exchange rate, argued the governor, referring to the measure taken in 2018 and which, in practice, de-indexed the Kwanza to the dollar. , which in the following years caused a depreciation of more than 80 percent.
The measure, said José de Lima Massano, was necessary to eliminate “major dysfunctions and imbalances in the Angolan foreign exchange market”, but had the effect of losing purchasing power and increasing the public debt-to-GDP ratio (Gross Domestic Product). ), as a good part of Angola’s debt was issued in dollars.
In addition to the strengthening of the Kwanza against the dollar, in recent months, and the increase in tax revenues through the increase in the price of oil, “consumers are also benefiting from the Government’s decision, in October 2021, to cut the rate of VAT (Value Added Tax) on essential goods, from 14 to 7.00 percent”, according to analysts from Oxford Economics Africa, in a recent note on the evolution of the Angolan currency.
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