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Angola aims for three-year ‘breathing space’ from creditors

ANGOLA hopes to get ‘breathing space’ on its debt for the next three years after negotiations with its main creditors, its finance minister said on Tuesday.

Africa’s second-largest oil exporter, which has been hit by both the coronavirus and an oil price rout, is in talks with bank creditors and China, said Vera Daves de Sousa during a Bloomberg virtual event.

‘We hope to have breathing space for the next three years,’ she said. ‘Since 2020, almost $6bn as a result of these negotiations.’

Angola owes more than $20bn to a number of Chinese entities, including $14.5bn to the China Development Bank and nearly $5bn to the Export-Import Bank of China. It has also borrowed from China’s largest lender, ICBC, according to analyst calculations.

It is also part of the G20 group’s Debt Service Suspension Initiative (DSSI), which since April has helped 46 countries defer $5.7bn in 2020 debt-service payments. G20 leaders on Sunday endorsed a plan to extend the freeze in payments to mid-2021.

Angola’s challenges went beyond its debt negotiations, said Daves de Sousa.

‘That’s why we keep working on our fiscal side and also on the investments that are needed to make sure our GDP growth is good to negotiate with creditors,’ she said.

Angola would consider tapping the Eurobond market once the market began to trust the government’s ability to service its debt again, she said.

‘2021 will be an important test as we believe we will start seeing the results of our fiscal reform,’ Daves de Sousa said.

Daves de Sousa also said the government aimed for the end of 2021 or the beginning of 2022 to begin the privatisation process of large companies such as Sonangol or Endiama, reports said.

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