Country Report Angola February 2009

Outlook for 2009-10

• The ruling party, Movimento Popular de Libertacao de Angola (MPLA), has cemented its political hegemony following its resounding victory in the legislative election in September 2008, securing 81.6% of the national vote.
• The president, Jose Eduardo dos Santos, is likely to stand as the MPLA's candidate in the presidential election, which is expected to take place in late 2009, to be followed by mooted municipal elections.
• The main opposition party, Uniao Nacional para a Independencia Total de Angola (UNITA), will struggle to redefine itself after securing just 10.4% of the national vote in the legislative election.
• With oil production expected to fall in line with OPEC cuts, real GDP will contract in 2009 by an average of 2.3%, before recovering modestly in 2010 to 6.2%, in line with rising oil production.
• The high level of imports, coupled with the currency's expected depreciation, will keep inflation high, at an average of 11.3% in 2009 and 10.5% in 2010.
• The collapse in export revenue in 2009 will push the current account into a deficit of 3.1% of GDP, before a recovery in international oil prices and output restores the current account to a surplus of 4.7% of GDP in 2010.

Monthly review

• The MPLA has announced that its sixth party congress will take place in December 2009, one year later than originally scheduled.
• According to the World Bank, in 2009 the imposition of OPEC cuts and lower international oil prices could cut government revenues by as much as 50%.
• The government is drawing up legislation for Angola's bio-fuel sector, which will impose environmental safeguards on bio-fuel projects and introduce measures to prevent them from competing with local food production.
• The government has announced that, as a result of OPEC cuts, oil production will fall from 1.8m b/d in December to 1.65m b/d by the end of March.
• The national oil company, Sonangol, has won a contract to construct a US$30m tax-free zone on Principe Island, which will provide servicing and fuel for ships operating in the Gulf of Guinea.
• According to data published by China's General Administration of Customs, Angola's trade with China reached an estimated US$25.3bn in 2008, a 79% increase on the previous year.
• In line with rising imports and improved customs administration, total customs receipts also rose sharply, from US$2bn in 2007 to US$3.7bn in 2008.

Source: Country Report

This report covers the following industry codes:
SIC Code: 60;49;10;15
NAICS Code: 52;22;212;23