Hit by the double blow of a sharp fall in oil prices and the coronavirus pandemic, Angola is facing a fifth straight year of recession — the deepest and longest economic slump in its modern history. Hopes remain, however, that a strong government commitment to structural reform and the support of a $4.5bn International Monetary Fund (IMF) financial assistance programme will lead to a modest recovery in 2021.
These twin shocks, combined with further depreciation of the kwanza, the Angolan currency, will inevitably affect asset quality in the financial sector — sub-Saharan Africa’s largest after South Africa and Nigeria. Banks in Angola nevertheless benefit from what the rating agency Moody’s describes as “a solid funding and liquidity profile” and “resilient profitability” to help them absorb losses.
