The Angolan government plans to raise a total of 10 billion kwanzas (10 billion euros) to cover the deficit in the 2024 General State Budget (OGE), as set out in this year’s Annual Debt Plan (PAE).
The PAE, approved by Presidential Decree no. 02/24, states that 6.1 billion kwanzas (6.6 billion euros) must be raised through the foreign market and the rest from the domestic market.
According to the order, signed by Angolan President João Lourenço and published in the Diário da República, the PAE materializes the financing strategy for the 2024 State Budget, “taking into account the sources of internal and external financing, as well as the limits of the level of indebtedness considered sustainable”.
This legal instrument should favor the contracting of instruments that help active liability management, promote the elimination of exchange-indexed securities, improve the maturity profile of public debt, encourage benchmark bonds and promote the secondary public debt market.
The 2024 State Budget, which sets out expenditure and estimates overall revenue of 24.7 trillion kwanzas (27.9 billion euros), began to be implemented on January 1, 2024.
At least 57.8% of the total expenditure in the Budget for the 2024 financial year, estimated at 14.3 trillion kwanzas (16 billion euros), will be allocated to servicing public debt, both internal and external.
According to the PAE, around 81% of the Angolan government’s debt stock “is exposed to exchange rate risk, namely Treasury Bonds (OT) in national currency indexed to the exchange rate, OT in foreign currency, Loan Contracts with local banks in dollars and euros and the entire stock of foreign debt”.
In another decree, João Lourenço also authorizes the Minister of Finance to resort to issuing OT “with the characteristics and conditions” set out in the 2024 State Budget to cover the financing needs arising from public investments.