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President João Lourenço explains advances and setbacks

Luanda, ANGOLA, October 17 - Angola on Thursday got acquainted with the results of the governance policy of the President of the Republic, João Lourenço, with figures that reflect advances and setbacks, essentially in the economic and social sectors. ,

 

The Head of State went to the Angolan Parliament and highlighted the gains, losses and projections of the Angolan economy, which aims to make it more dynamic and efficient, despite the adverse global macroeconomic scenario, given the Covid-19 pandemic.

 

In his speech on the State of the Nation, which marked the opening of the new Parliamentary Year (2020-2021), João Lourenço spoke, in plenary, of various investments made by the government to speed up the strategy to fight poverty and corruption in Angola. 

 

He also discussed in detail the policies drawn up to boost the economy, the budget deficits, the revenues obtained from the recovery and privatisation of assets, as well as the capital invested in social and economic assistance programmes.

 

Here you will find the main figures presented during the presidential speech on the State of the Nation:

 

Fiscal consolidation

 

In economic terms, President Lourenço said that in 2018 and 2019 Angola posted tax surpluses of around 2% and 0.6%, respectively.

 

For this year's revised general state budget, a fiscal deficit of 4% of GDP is expected, due to a 30% reduction in the country's revenues and a reduction in the budget reference price of a barrel of oil (from US$55 to US$33 per barrel). 

 

According to the data presented, by the end of 2019 Angola's public debt to GDP ratio stood at around 109%, mainly due to the sharp depreciation of the national currency that year. 

 

For 2020 it is expected to be around 120% of GDP.

 

According to the President, in the first quarter of 2020 the balance of payments current account was in surplus, equivalent to 6.8% of GDP.

 

At the end of September, the country's net international reserves stood at USD 15.4 billion, corresponding to 11.5 months of imports of goods and services, the "highest rate of import coverage". 

 

However, with the new exchange rate regime, the country saw a reduction in foreign exchange spending on imports of goods and services, and in the first half of this year it saved US$300 million on food imports.

 

In this period Angola consumed only US$980 million, as against US$1.3 billion spent in the first half of 2019.

 

The accumulated inflation rate fell from 41.95% to 16.9%, between 2017 and 2019, and this downward trend was interrupted due to the Covid-19 pandemic, which affected the country's production cycle and circulation of goods and services.

 

As a result of the pandemic crisis, the Angolan government expects the country to post a negative growth rate of around 3.6%.

 

VAT, PIIM, PAC/PRODESI

 

According to the Angolan head of state, tax policy continues to be in a process of modernisation, with the introduction of VAT, in the last quarter of last year, "already proved to be one of the main taxes in terms of collection. 

 

The amount of tax collected for this tax category rose from 75 billion Kwanzas, per quarter, to around 145 billion Kwanzas, in the same period.

 

As part of the improvement in the quality of expenditure, 69% of all public investment projects were qualified through public tenders by the middle of this year, a figure which is above the target set for 2020 (it was 45%).

 

In relation to the Integrated Plan of Intervention in Municipalities (PIIM), a total of 1.200 of the 1.749 projects foreseen are under construction, being that only 12 were finished and 537 are in the process phase for their start-up. 

 

The accumulated financial execution is over 67 billion Kwanzas.

 

As part of the drive to boost national production, 589 requests for funding were approved up to last September under the Credit Support Programme (PAC) initiatives to support PRODESI targets.

 

In this area, more than 300 family farming and livestock cooperatives were financed, as well as artisanal maritime fishing, continental fishing and aquaculture cooperatives, with a total value of around AKZ 144 billion.

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