Angola Country Brief – May 2025: Reform, Resilience, and Rising Potential

By Mark-Anthony Johnson

As Africa’s seventh-largest country and its second-largest oil exporter, Angola stands at a critical juncture in its economic journey. After decades of reliance on hydrocarbons – responsible for more than 30 percent of gross domestic product (GDP), 60 percent of government revenue, and nearly all exports – the nation is now pursuing ambitious structural reforms aimed at diversifying the economy and strengthening fiscal and monetary stability.

Economic Growth & Diversification

Angola’s GDP is projected to expand by 3.1 percent in 2025, up from 1.2 percent in 2023, signaling a gradual but meaningful recovery. Central to this transformation is the government’s push to reduce dependence on oil by developing key sectors such as agriculture, manufacturing, and services.

Enhanced energy production, growing agricultural output, and rising foreign direct investment are playing pivotal roles in driving this economic rebalancing.

Inflation & Exchange Rate Stability

Inflation remains a pressing concern, reaching 26.7 percent in 2024. However, policymakers have made progress in tempering price pressures, with inflation expected to ease to 24.2 percent in 2025.

Tighter monetary policy and improved currency management have contributed to stabilizing the kwanza, which had suffered significant depreciation in recent years. These efforts are gradually restoring confidence in the foreign exchange market.

Fiscal Management & Debt Sustainability

Angola has made considerable headway in fiscal consolidation. The fiscal deficit, which stood at 6.6 percent of GDP in 2017, is projected to narrow to just 1.4 percent in 2025.

Public debt, although still above sustainable levels, has been steadily declining thanks to improved debt management and economic recovery. Between 2020 and 2022, the country received US$7 billion in debt relief.

Authorities aim to bring the debt-to-GDP ratio down to 60 percent by 2026.

Trade & Reserves

In 2024, Angola maintained a robust trade surplus, with exports forecast at US$44.6 billion and imports at US$15.2 billion. While crude oil continues to dominate export earnings, efforts are underway to expand non-oil exports and diversify trading relationships.

Intra-African trade, though modest, is on the rise – with South Africa, Egypt, and the Republic of the Congo emerging as key partners. Foreign exchange reserves remain stable at US$15.2 billion in 2024, with further growth anticipated in 2025.

Financial Sector Reforms

The financial sector is undergoing a comprehensive modernization effort to address high levels of non-performing loans, strengthen governance, and enhance regulatory oversight. While the banking system remains concentrated, initiatives to upgrade payment infrastructure, boost financial inclusion, and improve supervision are gaining momentum.

Outlook

Angola’s macroeconomic outlook is cautiously optimistic. Despite ongoing challenges – including inflationary pressures, import dependency, and external vulnerabilities – the government’s sustained reform agenda is reshaping the country’s economic foundation. With continued emphasis on diversification, fiscal discipline, and regional integration, Angola is laying the groundwork for a more inclusive, resilient, and sustainable future.

Angola is a member of the African Continental Free Trade Area (AfCFTA), positioning it strategically for deeper regional economic engagement.

Mark-Anthony Johnson is the founder and CEO of JIC Holdings, a global asset and investment management firm founded in 2009. With over 30 years of experience and strong ties to Africa, his investments span mining, infrastructure, power, shipping, commodities, agriculture, and fisheries. He is currently focused on developing farms across Africa, aiming to position the continent as the world’s breadbasket.