The World Bank in Angola

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 36.75 million (World Bank 2023). A general population census is currently being conducted to gather updated information on the population size.

Economic Overview
Angola has significant economic potential. The country is rich in natural resources, it has large uncultivated arable land, benefits from favorable climatic conditions almost the entire year, adequate for almost all types of crops. Angola has also a demographic dividend potential, as about half of the population is young. Moreover, it benefits from a strategic geopolitical location that can facilitate the promotion of regional integration.

However, its growth potential has been constrained by the lack of economic diversification, as a result of dependence on the oil sector. As a result, economic volatility has led to recurrent episodes of macroeconomic instability, which have undermined growth and contributed to high levels of poverty and inequality.

The government has implemented a number of structural reforms to improve macroeconomic management and public sector governance. Key reforms include the adoption of a more flexible exchange rate regime, sound monetary policy, fiscal consolidation (such as fuel subsidies reforms), improved debt transparency and management, and State-Owned-Enterprises reform and privatization. The pace of reforms has been loosening due to limited institutional capacity, coordination, and communication.

Growth has recovered strongly to 4.4% in 2024 from 1.1% in 2023. This marks the most significant annual expansion since 2014. Recovery was led by the oil and mining (diamonds) sectors, services (driven by commerce), and agriculture (driven by fishing). The current account surplus recovered to an estimated 6.7% of GDP from 4.6% in 2023 thanks to lower imports of refined fuel products. As a result, gross international reserves improved to $15.7 billion in 2024, covering around 7.9 months of prospective imports. The currency depreciated by only 10% against the US dollar in 2024, after a depreciation of 64% in 2023.

Inflation accelerated from 20.4% in 2023 to 27.5% in 2025, driven by higher food prices and a diesel price adjustment. The Central Bank of Angola reacted by tightening the monetary policy stance with a 250 basis points increase in the policy rate to 19.5% (since November 2023). Public finances have deteriorated slightly. Oil revenues improved due to higher oil prices and production; however, they were more than offset by a reduction in non-oil revenues and higher expenditure. Interest payments on public debt absorb about 6.2% of GDP, more than a quarter of total expenditure. The overall fiscal deficit deteriorated from 0.7% in 2023 to 1.5% in 2024. Public debt has declined to about 70.9% of GDP from 89%, due to higher nominal GDP growth.

Rising inflation and declining per capita income have strained household purchasing power, especially for the less well-off. This has been reflected by the continuous decline in the consumer confidence index to the lowest level since 2020. This year, more than a third of the population is projected to live on less than $2.15 per day. To mitigate the economic impacts of the fuel subsidy reform, the government has expanded the cash transfer program ‘Kwenda’ to urban and peri-urban areas, where the impacts of the fuel subsidy reform are expected to be felt most.

Growth is expected to reach 3.2% in 2025, mostly driven by the strong dynamism of the non-oil sectors, as the oil sector is expected to return to its declining trend in the medium-term. However, structural constraints are projected to limit growth to 3.2% over 2026–27 on average, with real per capita GDP stagnating. Tight monetary policy is expected to contain inflationary pressures from the fuel subsidies reform. The fiscal stance is expected to loosen as the country approaches the next election cycle.

As a result, the overall balance is projected at an 2% of GDP over 2025–27 and public debt-to-GDP to stand around 70% by 2026–27. External balances are projected to stay strong, with international reserves covering over seven months of imports. High inflation and limited growth in per capita GDP are likely to keep poverty rates high, around 36% by 2026, underscoring the need for a stronger social safety net and more development spending. Risks remain high, as shocks to global oil prices and heightened global tensions may pose significant challenges.

Development and social challenges
Angola’s reliance on the oil sector has increased its vulnerability to external shocks and undermined macroeconomic stability. Strong real exchange rate appreciation has stunted the non-oil economy and limited economic diversification and job creation. The economy is not generating enough jobs to keep up with Angola’s growing working-age population, while 8 out of 10 workers are engaged in informal, low-productivity sectors. Youth unemployment poses a major challenge, with the unemployment rate for those aged 15-24 far exceeding the overall rate. High adolescent pregnancy rates, maternal and neonatal deaths, and child stunting highlight the need to invest in human capital development.

Diversification remains elusive while oil production is in structural decline and global decarbonization looms in the medium-term. Angola needs to urgently invest in removing barriers to private sector investment to achieve economic diversification to support growth, job creation, and poverty reduction.

Political Context
Angola operates under a multi-party system, where general elections are held every five years. The Popular Movement for the Liberation of Angola (MPLA) has been in power since the country gained independence from Portugal in 1975. In August 2022, the MPLA won the fourth post-war elections with 51% of the vote and secured President Joao Lourenço a second and final term in office.

Internationally, Angola is continuing to be assertive and demonstrating commitment to stability in Africa, particularly in the Democratic Republic of Congo, where it has led regional efforts to end conflict that threatens the entire Great Lakes Region.    

Last Updated: Apr 11, 2025

While a new Country Partnership Framework (CPF) is planned for FY25–29, the overarching strategy of the World Bank Group’s current support activities in Angola focuses on pillars of the previous CPF, concentrating on the promotion of more inclusive development, consisting of two core objectives (pillars) and one foundation plank of a cross-cutting nature.

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 CPF 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 through stronger attention to quality and implementation of the 18 existing investment projects (net commitment of $4.3 billion) with International Bank for Reconstruction and Development (IBRD) financing and the three current Reimbursable Advisory Services (RAS). 

Last Updated: Apr 11, 2025

Health 

The  Municipal Health Service Strengthening Project aims at improving the performance of 232 primary health care facilities (117 health posts, 93 health centers, and 22 municipal hospitals) in the target municipalities. This represents approximately 80% of the 288 health units estimated to exist in the 21 municipalities from 7 provinces in Luanda, Bengo, Lunda Norte, Moxico, Malanje, Uíge e Cuando Cubango. Some results include:

·       278 integrated mobile brigades are providing essential health services to over 3,011,640 individuals.

·       Established 450 advanced vaccination teams, equipped with 20 motor vehicles, facilitating routine vaccinations for over 1,748,367 children.

·       33 technicians have been trained in integrated pediatric care through virtual and in-person workshops focused on developing Annual Operational Plans for municipal health units.

·       359 technicians have been trained in laboratory surveillance for COVID-19 and respiratory syndromes.

·       350 technicians from municipal hospitals and health posts have received training at municipal and provincial levels.

·       The country has achieved significant COVID-19 vaccination coverage, with 87% of individuals over 12 receiving the first dose and 51% completing the full regimen.

·       Training has included 300 health professionals, 215 of whom are women, focusing on immunization practices and gender-based violence awareness.

·       The project is finalizing a communication campaign to promote immunization, including COVID-19 booster doses.

Social Protection 
The Strengthening the National Social Protection System Project has rapidly expanded its coverage and is at a crucial stage of its evolution into a system that is institutionalized into becoming an integral part of the government’s efforts to reduce poverty. Its three components have so far achieved:

• The Cash Transfer component registered more than 1.6 million households across the country. As of September 2024, over 1 million households have been paid (70% of beneficiaries are women).

• Productive inclusion has been implemented in ten provinces and 13 municipalities, with the main lines of work including agriculture, honey production, animal husbandry, community-saving schemes, and product processing. This has benefited more than 26,000 beneficiaries (more if indirect beneficiaries in the households are considered). 

• Human capital activities have benefited about 373,488 households through Integrated Social Action Centers (CASI) and Community Development and Sanitation Agents (ADECOS).

Water  
The Water Sector Institutional Development Program II (PDISA II) has continued to strengthen the operations and management of six water supply utilities through performance management contracts with international companies that are providing support in technical, commercial, financial, and human resources areas. Under PDISA II, about 265,000 people have benefitted from water supply through 76,000 new household water connections, 500 km of network, and an additional 3,000 m3 production capacity. The project is also financing performance-based Technical Assistance and infrastructure for utilities to improve performance and attract the private sector, as is the case of the proposed affermage for the provincial cities of Cabinda, Bie, Huambo, Lunda Sul, and Cuanza Norte.

Agriculture  
The Angola Commercial Agriculture Development Project (PDAC), co-financed by the World Bank and the French Agency for Development, has contributed to the Government of the Republic of Angola’s economic diversification agenda by supporting the transition from subsistence to a more market-oriented, competitive agriculture sector. PDAC seeks to incentivize bank lending to agriculture by helping producers and Small and Medium Enterprises (SMEs) prepare and finance agriculture investments, by providing technical assistance, grants, and de-risking through partial credit guarantees. As of February 2025, 543 projects have been approved, translating to about $62.04 million in total agriculture investment, of which $11.5 million is co-financed by commercial banks.

PDAC has funded the first partial credit guarantees scheme dedicated to the agriculture sector in Angola—an innovation for the agribusiness sector in the country—mobilizing about $4.8 million in private bank financing so far (80 guarantees have been issued).

The Angola Smallholder Agricultural Transformation Project is designed to support the development of smallholder agriculture and its climate-related risks by financing technical assistance and investments to improve agricultural productivity and climate resilience, enhance the drought response in the south of Angola, and contribute to food and nutrition security. As of December 2024, 800 Farmer Field Schools have been established in five provinces, benefiting 18,000 smallholder beneficiaries, of which 45% are women. It is estimated that by the end of the project, 113,100 small farmers will benefit, in a total of ten provinces and 38 municipalities

The project will eventually benefit 113,100 smallholder producers with technical, institutional, managerial, and marketing skills through a revised and contextualized Farmer Field School’s approach. More specifically, the project will improve access to nutrition and climate-smart agriculture and livestock technologies and practices. Furthermore, the project will support the rehabilitation of 40 gravity irrigation schemes with a total irrigated area of 1,440 ha and 4,200 beneficiaries. 

Education 
The Girls Empowerment and Learning for All Project (PAT II) is a $250 million operation that seeks to empower Angolan youth, especially girls, and to improve learning quality for all.

• As of November 2024, the project has successfully trained 930 gender focal points in schools, resulting in improved access to sexual and reproductive health information and services for around 28,000 girls and boys have improved access to sexual and reproductive health information and services. Additionally, to reduce school dropout rates, particularly among girls, 200,000 menstrual hygiene kits have been delivered to target municipalities for distribution to adolescent girls participating in school clubs.
• In partnership with the ministry of health, more than 900,000 boys and girls (ages 5–10 years) have benefitted from the project supported school-based deworming campaign in 9 provinces. This activity is expected to benefit more than 2 million boys and girls by December 2025.

• Through the project’s pilot and first expansion phases 62,782 students have completed second chance education, of which 41,965 are women. Another 372,571 students were enrolled in modules 1, 2 and 3 of primary and the 1^st cycle of secondary education.

• The pilot of the scholarship program supported about 20,000 students in the 1^st cycle of secondary education in four municipalities. For the first expansion phase, a total of 128,314 beneficiaries were registered in 374 schools in 19 municipalities. The second expansion phase scheduled to begin in August 2025 is expected to benefit an additional 508,832 students in all 21 provinces. 
• There are 7 schools in rehabilitation in the Province of Luanda, and the process to construct 56 new schools are making progress. As of March 2025, construction has started in the Provinces of Cabinda and Cuanza Norte. The construction and rehabilitation interventions are expected to provide 672 classrooms (an additional 57,000 learning spaces) for students in secondary education.

Strengthening Statistical Capacity
The Angola Strengthening Statistical Capacity Project has made significant progress in increasing statistical efficiency in data production and optimizing data utilization for public monitoring. Key accomplishments include:

• Completion of census cartography
• Collection of the 2024 labor force survey (IEA).
• Finalization of three rounds of the Agricultural and Fisheries Surveys (ICAPP) for the 2023/24 agricultural year and initiation of data collection for the 2024/25 year.

Additionally, technical assistance and financing are being provided to the Household Income, Expenditure, and Employment Survey (IDREA), the first survey to facilitate direct comparisons of poverty and welfare trends over time in Angola. The initiative also supports the modernization of the National Statistics Institute (INE).

Last Updated: Apr 11, 2025

The World Bank Group continues to leverage its support by working closely with 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 in Angola include United Nations agencies (UNDP, UNICEF, the World Health Organization, UNFPA, FAO), the African Development Bank, the European Commission, USAID, the French Development Agency, as well as oil sector companies collaborating on innovative cooperation opportunities.  

Last Updated: Apr 11, 2025