Simon Ateba is Chief White House Correspondent for Today News Africa. Simon covers the U.S. government, the International Monetary Fund, the World Bank and other financial and international institutions in Washington D.C. He can be reached on [email protected]
The Executive Board of the International Monetary Fund (IMF) on Wednesday approved an immediate release of about $772 million to Angola, bringing total disbursements under the current loan arrangement to $3.9 billion.
The approval came after the IMF completed the fifth review of Angola’s economic program supported under the Extended Fund Facility (EFF), a type of loan arrangement that allows the country to borrow money from the IMF over an extended period of time.
Angola’s three-year extended arrangement was approved by the Executive Board on December 7, 2018, in the amount of about $3.7 billion at the time of approval.
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The loan aimed to restore external and fiscal sustainability, improve governance, and diversify the economy to promote sustainable, private sector-led economic growth.
At the time of the third review, the Executive Board also approved the Angola’s request for an augmentation of access of about $765 million at the time of approval to support the authorities’ efforts to mitigate the impact of COVID-19 and sustain structural reform implementation.
“Angola is transitioning to a gradual recovery from the COVID-19 shock amid higher global oil prices, low levels of reported COVID-19 infections and the start of a vaccination campaign,” IMF said in a statement. “The effects of the pandemic continue to be felt across the economy and society, however. The authorities have supported the recovery through sound policies that aim to further stabilize the economy, create opportunities for inclusive growth and protect the most vulnerable in Angolan society.”
According to the Fund, the ongoing fiscal adjustment, in the face of the pandemic’s impact, “is reinforcing debt sustainability, while allowing for increased health and social spending.”
It added that Angolan authorities have also tilted their monetary policy stance towards tightening, considering persistently high inflation.
“In completing the review, the Executive Board also approved the authorities’ request for a waiver for the nonobservance of the continuous performance criterion on non-accumulation of external debt payment arrears by the Central Government and the Banco Nacional de Angola,” said IMF.
The Executive Board also approved today Angola’s request for modification of some performance criteria, indicative targets, and structural benchmarks.