Business
After experiencing surplus, Angola aims to balance budget in 2012
(Reuters) – Angola’s government is aiming for a balanced budget in 2012, after an expected surplus this year, as it plans to step up spending on health and education, state news agency Angop reported on Tuesday.
Angola, Africa’s second-largest oil producer after Nigeria, hopes strong oil output next year will help it overcome the impact of the global financial crisis and continue recovering from a 27-year civil war that ended in 2002.
Angop said the 2012 draft budget bill delivered by the government to Parliament Speaker Paulo Kassoma on Tuesday forecasts revenues of 4.32 trillion kwanza (US$ 46 billion), with government spending matching that value.
Around a third of public spending is earmarked for health and education in 2012, an increase of around 10 percent from the amount budgeted for this year, Angop cited Parliamentary Affairs Minister Norberto dos Santos as saying.
The bill will be debated in parliament on November 15 and is expected to be passed by the ruling MPLA‘s large majority.
The plan was approved by President Jose Eduardo dos Santos‘ cabinet on Friday and Angop reported then that the government forecasts economic growth of 3.4 percent for this year and 12.8 percent in 2012.
The estimates differ slightly from those provided by Dos Santos in a speech last week, when he put 2011 growth at 3.7 percent, in line with the International Monetary Fund’s projection, and then speeding up to 12 percent in 2012.
Angola’s economy was hit hard when crude prices began to drop in 2008 with its growth rate slowing sharply to 2.4 percent in 2009 after five years of double-digit expansion.
The country posted a budget deficit of 4.4 percent that year, its first since 2003, followed by a 2 percent deficit last year.
The 2011 budget forecast a budget surplus of 2.4 percent based on economic expansion of 7.6 percent, but the government has been forced to revise its growth forecast due to lower-than-expected oil output due to technical problems.
Analysts say, however, that despite the shortfall in revenues, the government has been cautious in its spending programme and is on track to meet the surplus target.