Angola will not request new loan from IMF

(Reuters) – Angola does not plan to request a new loan from the International Monetary Fund (IMF) after the end of its US$1.4 billion standby agreement later this year, the country’s economy minister said on Monday.

“We don’t intend to resort to a new line from the IMF. More than the resources which the IMF granted, for the Angolan government what mattered was the technical support for the macroeconomic reforms we had already started,” Economy Minister Abrahao Gourgel told reporters in Lisbon.

Angola, which is Africa’s second-biggest oil producer Nigeria, signed the deal with the IMF in 2009 to stabilize its balance of payments after an abrupt drop in oil prices led to a depletion of its net foreign reserves in 2008.

The country depends on oil revenues for over 95 percent of its imports and around 45 percent of gross domestic product (GDP).

Gourgel said the IMF’s support for Angola’s reforms had helped give the country credibility when it sought, and obtained, credit ratings from international agencies in 2010.

“At that level, yes, we want to continue with the IMF’s involvement, but not necessariy in a programme with this configuration. We want to count on the IMF’s services as a consultant,” he said.

The country’s central bank has been praised by the IMF and credit ratings agencies for executing a policy which has reduced inflation, kept the kwanza currency stable and boosted foreign reserves this year.

Angola has so far received US$1.21 billion of the total loan, and IMF officials completed a sixth review of the agreement in Luanda on Friday which will be the basis of a decision on granting a final tranche.

The IMF has also urged the country to create a sovereign fund to invest profits from oil production.

“We had planned to create it before the crises, the larger-than-expected impact on the financial crisis on us delayed the process,” Gourgel said. “We have some funds for energy and infrastructure, but the creation of a sovereign fund requires much larger funds that those we have at the moment.”