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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 30 million (2018). 

    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. 

    Macroeconomic stability has been restored and maintained through a more flexible exchange rate regime, restrictive monetary policy, and fiscal consolidation. The government has delivered on several key reforms since taking office in 2017, including the new law on Preventing and Combating Money Laundering, as well as the privatization law, the setup of a one-stop window for investors to improve the business climate, and the establishment of a social protection registry to protect the most vulnerable from the reforms. These reforms are already producing some positive results, as Angola tapped the Eurobond market again in the amount of $3.0 billion, and the IMF has approved the second review of the EFF program in December 2019. 

    The Banco Nacional de Angola (BNA) has maintained a restrictive monetary policy stance to anchor inflation and to offset the impact of the exchange rate devaluation. The BNA continued its efforts to reach a more flexible exchange rate by allowing the oil companies to sell foreign exchange directly to commercial banks, contributing to strengthen buffers against external shocks. Inflation remained high but continued to decline from 18.6% in 2018 to 16.9% in 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. An Asset Quality Review (AQR) was conducted with the support of IMF and has indicated that the financial sector is sound.  

    Angola is expected to remain in recession in 2020 due to the recent plunge in oil prices and the global slowdown resulting from the impact of COVID-19. Oil sector growth will be highly affected due to the combined effect of supply and demand shocks. Non-oil sector growth is also projected to decline due to spillover effects from lower oil prices, reduced imported capital goods, tighter financing conditions, currency depreciation, and restrictions in the movements of goods and people 

    The COVID-19 pandemic and the global economic disruptions caused by it put at risk Angola’s achievements of macro-economic stabilization and transition to a more sustainable and inclusive growth model.  

    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.  

    While no official statement has been made thus far, the planned local elections scheduled for 2020 are likely to be postponed due to the crises posed by covid-19 and low oil prices.   

    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. According to 2018/2019  Expenditure and Income Survey from national institute of statistics, poverty index was at 40.6%. A social protection scheme program has been launched with a pilot cash transfer project which will benefit over 1.6 million vulnerable families until 2022 across the country.  

    Last Updated: Jul 01, 2020

  • 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 $1.8 billion dollars. 

    Last Updated: Jul 01, 2020

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

    Human Capital 

    The Health System Performance Strengthening Project (HSPSP) is targeting more than 200,000 people in five municipalities in which a Results-Based Financing pilot called PASSABEM is being implemented. Currently the project has:

    • Identified and registered more than 103,000 beneficiaries representing 51.4% of the estimated population

    • In response to the COVID-19 pandemic, the project made $15 million available for the urgent and immediate health sector response, and supported World Bank technical assistance in conducting a quantification of the COVID-19 needs which served as the basis to outline needs areas, inform procurement, and help coordinate donor support

    • Purchased personal protective equipment, bio-security and diagnostic materials, and the operationalization of the logistical response which included contact-tracing and field-based training

    The 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. To date, the project has: 

    • Established 167 pedagogical influencing zones (ZIP) in the project implementation areas. A 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 covered four out of the six modules planned for the training program. In these modules, a total of nearly 15,000 teachers have been trained on methodology of teaching Portuguese language, mathematics, pedagogical supervision, assessment in the classroom and pedagogical differentiation

    Water 
     
    The first phase of the Water Sector Institutional Development Program (WSIDP), also known as PDISA:

    • Supported the creation and strengthening of six new water supply utilities that are providing household services to more than 800,000 new customers

    • The utilities financial and operational performance has improved significantly.

    • A new regulator and a new water resources management institution have similarly been created with project support and are carrying out their mandates. 

    • Additionally, 1,000 km of network was installed in Uige, Malanje, Ndalatando, Huambo, Kuito, Lubango and Luena.

    • A second generation of the project, WSIDP2 ($350 million), is now effective and will scale up the infrastructure activities, provide increased institutional strengthening and incorporate sanitation activities. WSIDP2 also secured funds from the Agence Française de Développement ($150 million) and the European Investment Bank ($100 million).

    Social and Economic Infrastructure 

    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 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

    Agriculture 

    The 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 has 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

     

    Last Updated: Jul 01, 2020

  • 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 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: Jul 01, 2020

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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
External Affairs Associate
Luanda, Angola
+244 222 393 389
wpiassa@worldbank.org
For project-related issues and complaints
angola_alert@worldbank.org