The International Monetary Fund (IMF) has approved a second tranche of a $247 million loan to be paid to Angola under its Extended Fund Facility following a review of the southern African oil producer’s progress under the program. The multi-lateral lender announced the move recently.
The IMF originally approved the facility totaling $3.7 billion in December 2018 to help Angola manage twin budget and balance of payments crises after tanking global crude prices ripped a hole in its revenues. Angola is Africa’s second biggest oil exporter and relies on sales of the fossil fuel for about 65 per cent of total tax revenue, but a combination slack crude prices and years of mismanagement at state oil-producer Sonangol have left it struggling for funds.
The IMF’s Extended Fund Facility (EFF) is a loan pegged on deep structural, macroeconomic and governance reforms designed to help countries with weak economic growth and problems paying bills.
Reuters quoted to statement to have explained that Angola had made progress in reducing state spending and broadening economic activity outside of oil, but that the economic outlook was still uncertain and it had to do more to fight mismanagement and corruption.
“The authorities’ commitment to fiscal consolidation has been illustrated by the outperformance of the end-June 2019 non-oil primary fiscal deficit target by a wide margin,” said Tao Zhang, IMF deputy managing director and acting chairman.