Moody’s adjusts forecast for Angolan economy as public debt rises

Global credit ratings agency, Moody’s, has downwardly revised the growth forecast for the Angolan economy to 4.1% in 2015 and 4.7% in 2016.

In a statement, Moody’s pointed out that it was due to concerns around the weight of public debt on the country’s public finances, especially if loans and debt issues continue to compensate lower oil prices.

“The response to the oil price shock has been aggressive, but its debt burden is at risk of a substantial increase over the next two years should the government face difficulty maintaining fiscal discipline,” said Moody’s analyst Rita Babihuga.

Angola’s public debt is forecast to rise to 42% of gross domestic product (GDP) this year, versus an estimated 32% t in 2014, she added.