Angola: Government Financing Strategy for 2024-26

The Angolan government has approved its financing strategy for 2024-2026 (the “Strategy”) through Presidential Decree 52/24, of 15 February 2024. Below are the Strategy highlights:

The Strategy encompasses the so-called “direct public debt” (internal and external) which includes:

• Debt of Central Government;
• Debt of State-owned companies Sonangol (national oil company) and TAAG (flag carrier);
• Sovereign Guarantees issued by the government.

The Strategy will maintain the measures adopted in the 2022-2024 period, including:

• Prioritize debt instruments which reduce the risk of fluctuations in the interest rate or oil price;
• Not use debt instruments which are indexed to a hard currency (USD or Euro) to Kwanza (Angolan currency) exchange rate;
• Extend maturities of debt instruments;
• Reduce the number of Angolan debt instruments in circulation;
• Increase the size of debt instrument lots;
• Maximize concessional loans;
• Improve transparency with national and international investors.

In addition, for the period 2024-2026 the following new measures will be pursued:

• Promote sustainable financing based on ESG principles and which can achieve the Sustainable Development Goals (SDG);
• Avoid financing collateralized by oil or other commodities;
• Minimize short-term debt;
• Maximize external financing with long maturities (15-20 years);
• Seek grace periods of at least 5 years.

The Strategy aims to achieve the following debt indicators by 2026

Rui Amendoeira, OneLegal Partner.