(EnergyAsia, May 22 2012, Tuesday) — Angloa’s economy will rebound to grow by 8% this year after expanding by 4% last year while its rate of inflation is declining, said the International Monetary Fund (IMF).

“The pace of economic activity is expected to pick up in 2012, as oil production rebounds. Growth is projected to accelerate to about 8%. Economic activity in several sectors is benefitting from a scaling-up of public investment programs and from the settlement of past government arrears,” said the IMF which issued its assessment of the country after a study visit by a study team to Luanda from May 2 to 17.

Led by Mauro Mecagni as part of the agency’s 2012 Article IV Consultation and First Post-Program Monitoring Mission, the team met Angola’s Cabinet ministers and other senior government officials, and representatives of the banking, business, diplomatic, and academic communities.
The team praised the Angolan authorities for achieving the key objectives specifcied in the 2009-2012 economic stabilisation programme supported by the IMF.

Three years after the abrupt decline in world oil prices that severely affected its economy, Angola has attained an improved fiscal position, a more comfortable level of international reserves, a stable exchange rate, and lower inflation.

According to the IMF, Angola has settled its domestic arrears and made “significant progress” toward improving fiscal transparency and accountability.

It added: “Macroeconomic performance in 2011 was affected by oil production problems. Robust non-oil growth compensated for the oil sector decline, resulting in an overall real growth rate of about 4%.

“Inflation continued its gradual decline, to about 11% at the end of the year. The overall fiscal surplus increased to about 10% of GDP, in part helped by high oil prices. International reserves came to exceed US$27 billion by the end of the year, a level equivalent of 6 months of 2012 imports.”

“Economic prospects over the next few years remain positive given current projections for oil prices and the strong reform momentum envisaged in the authorities’ medium-term plans.”