Overview

  • A vast country with a long coastline and central plateau, Angola thrusts inland across Southern Africa to border Namibia, Botswana, Zambia, and the Democratic Republic of the Congo. Its principal cities, including its capital, Luanda, look west over the South Atlantic to Brazil, another Portuguese-speaking nation (like itself). It has a population of more than 28.8 million (2016).

    Economic Overview

    Despite significant progress on macroeconomic stability and structural reforms, Angola is still suffering the effects of lower oil prices and production levels, with an estimated gross domestic product (GDP) contraction around 1.2% in 2018. The oil sector accounts for one-third of GDP and more than 90% of exports. The transformation of a state-led oil economy to a private-sector-led growth model is a complex and long-term process and the oil sector will continue to play an important role during this transition period.

    The government has delivered on several key reforms since taking office in 2017. Two laws that are essential to enhance private sector-led growth and competitiveness have been approved: the private investment law and the antitrust law, followed by the creation of a competition authority. The government took first steps to reform public utilities, utility tariffs and subsidies, and to privatize or liquidate some state-owned companies by creating IGAPE – the state-owned enterprise (SOE) oversight agency. The government also established a social protection registry to protect the most vulnerable from the reforms.

    Macroeconomic stability has been restored and maintained through a more flexible exchange rate regime, restrictive monetary policy, and fiscal consolidation. The reform program is supported by a three-year Extended Arrangement Under the Extended Fund Facility (EFF) from the International Monetary Fund ($3.7 billion) and a programmatic series of Development Policy Financing (DPF) from the World Bank ($500 million).

    The policy response since late 2017 has been adequate and effective in reducing domestic imbalances. The Banco Nacional de Angola (BNA) adopted a restrictive monetary policy to anchor inflation and to offset the impact of the exchange rate devaluation; however, the tight monetary policy stance has been relaxed somewhat in 2019 with interest rate cuts in January and May to stimulate economic activity. Inflation remains high but continued to decline from 18.6% at end-2018 to 17.2% in July 2019, reflecting weak economic activity and muted exchange rate pass-through.

    The authorities are actively addressing financial sector vulnerabilities. The BNA increased minimum capital requirements for banks, which led to the closure of three banks. Nonperforming loans (NPLs) remain high at 28% of total gross loans; but they are concentrated in Banco de Poupança e Crédito (BPC), whose restructuring is part of the IMF EFF program.

    Political Context

    Angola has maintained political stability since the end of the 27-year civil war in 2002. In 2010, a constitution established a presidential parliamentary system with the president no longer elected by direct popular vote but instead as the head of the party winning the most seats. The 2010 Constitution sets a limit of two, five-year presidential terms. The country’s first local elections are planned for 2020.

    Internationally, Angola is becoming more assertive and demonstrating a more steadfast commitment to peace and stability in Africa, particularly in the Great Lakes region. Very recently it facilitated an agreement to end mounting tensions between the neighbors Rwanda and Uganda.  

    Development Challenges

    Angola has made substantial economic and political progress since the end of the war in 2002. However, the country continues to face massive development challenges, which include reducing its dependency on oil and diversifying the economy; rebuilding its infrastructure; and improving institutional capacity, governance, public financial management systems, human development indicators, and the living conditions of the population.

    Large pockets of the population live in poverty without adequate access to basic services, and the country could benefit from more inclusive development policies. The government is creating a social protection scheme program aimed at assisting the poorest of the poor.

    Last Updated: Sep 26, 2019

  • World Bank Group Commitment to Angola

    World Bank Group (WBG) activities in Angola are undertaken as part of the Country Partnership Framework (CPF) for 2014-2016 and which were extended through 2018. The overarching strategy of the CPF is the promotion of more inclusive development, and it consists of two core objectives (pillars), and one foundation plank possessing a cross-cutting nature. The pillars and foundation are as follows:

    • Pillar I focuses on supporting integrated national economic diversification by revitalizing rural economies to create greater competitiveness and employment. The focus is on the strengthening of the non-oil economy, with an emphasis on rehabilitating traditional lines of business that suffered greatly during the war, as well as technical assistance for the energy sector.
    • Pillar II focuses on enhancing the quality of service delivery and instituting a strong social protection program to improve the quality of life of the population and equip individuals to take a greater role in the development of the country.
    • The Foundation Plank of the CPS revolves around building human and institutional capacity to approach the levels common in middle-income countries, complementing the two strategic pillars.

    These objectives will be achieved during the CPF period through stronger attention to quality and implementation of the seven existing projects with International Development Association (IDA), and International Bank for Reconstruction and Development (IBRD) financing, and the three current Reimbursable Advisory Services (RAS).

    The current World Bank portfolio is comprised of nine investment projects (IDA/IBRD) with a total net commitment of nearly $1.05 billion dollars.

    Last Updated: Sep 26, 2019

  • The World Bank (WB) has successfully contributed to Angola’s development by providing support in the following areas:

    The Angola Social Action Fund, commonly known as “Fundo de Apoio Social” (FAS), has been the main World Bank Group (WBG) support program that contributes to promoting decentralization. The project, which has improved poor communities’ access to basic social and economic infrastructure and provision of services, has been in implementation in various phases since 1994. The project, now called the Local Development Project (PDL), is in its fourth phase, including a recently approved International Bank of Reconstruction and Development (IBRD) Additional Financing. The project provides direct financial support and capacity development assistance to poor communities, complementing the government’s efforts in the decentralization process. During the third phase of the project, 1,575 pieces of community infrastructure were constructed and rehabilitated in all 18 provinces of the country, enabling about 2.3 million Angolans to gain access to basic social and economic services. Mechanisms and practices for participatory governance systems have been established, in which local governments are increasingly more accountable to their constituencies. About 7,200 individuals have benefited from the project’s capacity development activities, half of whom received formal training.

    StatCap Project: To improve data for poverty measurement and better allocation of resources for social programs, the WBG started the Statcap Project in May 26, 2017, which aims to enhance statistical capacity. The project includes the Agriculture Monitoring System [RAPP-Agriculture Census and follow-up surveys ($24m). The RAPP pre-test was successfully implemented in early July 2017 and the main data collection throughout the country is expected to be completed by the end of December 2019. 

    Market Oriented Smallholder Agriculture Development Project (MOSAP)Supports beneficiaries by providing training and new technologies, improving their organizational and marketing skills, and improving their access to extension services and agricultural inputs. It also supported strengthening the farmers’ organizations. About 725 farmers’ field schools were created by the project and helped train more than 50,0000 smallholder famers to boost the production of the major crops targeted by the project.

    Learning for All Project: envisages improving teacher’s skills and knowledge as well as school management in Project-designated areas. The project also envisages to develop a system for systematic student assessment. 

    The project has established 167 pedagogical influencing zones (ZIP) in the project implementation areas. ZIP model creates a school network in which schools share and collaborate with each other in their day-to-day work to deliver high quality education. Each ZIP comprises six to seven primary schools which are within a radio not exceeding 10 kilometers and are led by a coordinator who has been trained by the project to act as trainer of trainers.

    The project has thus far established 167 ZIPs and has covered four out of the six modules planned for the training program. In these modules, a total of nearly 15000 teachers have been trained on methodology of teaching Portuguese language, mathematics, pedagogical supervision, assessment in the classroom and pedagogical differentiation. 

    Last Updated: Sep 26, 2019

  • The World Bank Group continues to leverage its support by working closely with other key stakeholders. This entails closer collaboration with other development partners, the private sector, civil society organizations (CSOs), academia, and think tanks.

    Some of the institution’s traditional partners include United Nations agencies (UNDP, UNICEF, the World Health Organization, UNFPA), the African Development Bank, the European Commission, USAID, the French Development Agency, as well as the oil sector companies on innovative cooperation opportunities.

    Last Updated: Sep 26, 2019

Api


LENDING

Angola: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments


PHOTO GALLERY

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Additional Resources

Country Office Contacts

Main Office Contact
Domo Business Center, 86, 7th Floor. Av. Lenin
Ingombotas
Luanda, Angola
+244-222-394677
For general information and inquiries
Wilson Mbanino Piassa
Communications Associate
Luanda, Angola
+244 222 393 389
wpiassa@worldbank.org
For project-related issues and complaints
angola_alert@worldbank.org