Country Report Angola May 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 September 2008 legislative election, 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 2010, to be followed by 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 is forecast to contract in 2009 by an average of 2.3%, before recovering modestly in 2010 to 6.4%, 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 11.9% in 2009 and 10.6% in 2010.
• The collapse in export revenue in 2009 will push the current account into a deficit of 4.9% of GDP, before a recovery in international oil prices and output restores the current account to a surplus of 0.6% of GDP in 2010.

Monthly review

• The governments of Angola and the Democratic Republic of Congo (DRC) have agreed to set up a joint technical commission that will demarcate the disputed maritime border between the two countries.
• The long-serving governor of the Banco Nacional de Angola (BNA, the Central Bank), Amadeu Mauricio, has been replaced by the former deputy industry minister, Abraao Gourgel.
• The central bank's ability to support the kwanza on international markets is coming under severe pressure, with foreign-exchange reserves falling from US$20.4bn at end-November to US$13.5bn at end-April.
• Demand for the government's new kwanza-denominated bonds has been weak, with few purchasers for one- and two-year bonds.
• Angola's oil production is set to rise from 1.65m barrels/day (b/d) in March to 1.76m b/d in June, despite the imposition of an OPEC quota of 1.517m b/d.
• Signs are growing that Angola's property market is cooling after a period of booming prices, although a major price crash in not expected.
• The government is pressing ahead with its pre-election pledge to build 1mlow-cost homes in 2009-12, 80% of which are to be built by private construction companies or individuals.

Source: Country Report

This report covers the following industry codes:
SIC Code: 48;70;15;49;60;10
NAICS Code: 517;72;23;22;52;212