Angola is in talks with the African Development Bank (AfDB) for budget support financing as it seeks to manage debt pressures and protect vulnerable households from the economic fallout of global conflict, Finance Minister Vera Daves de Sousa said.
Speaking on the sidelines of the IMF and World Bank Spring Meetings in Washington, the minister said discussions were ongoing for a US$165 million loan, part of a broader external financing plan of roughly $1 billion for 2026.
“This is a work in progress,” she told Reuters, adding that the proposed AfDB facility would require policy commitments that are still being finalised before it can be submitted for board approval.
Angola, one of Africa’s largest oil producers, is simultaneously weighing financing options from bilateral lenders and international capital markets to close its remaining funding gap.
Despite elevated global uncertainty linked to the war in the Middle East, the government said rising crude prices were providing a buffer for its economy, helping to stabilise growth and support fiscal planning.
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The 2026 budget was built on a conservative oil price assumption of $61 per barrel, but Brent crude has recently traded close to $100, creating a significant revenue windfall for the oil-dependent economy.
Officials say the higher prices are helping offset economic disruptions elsewhere in the economy, which has been affected by global volatility linked to the conflict.
Debt servicing remains a major constraint. According to government data, debt repayments consumed nearly half of Angola’s initial 2026 budget projections, prompting authorities to pursue measures aimed at reducing borrowing costs and improving fiscal sustainability.
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The finance minister said Angola is not currently seeking a full programme from the International Monetary Fund, although it continues to receive technical assistance on tax administration, expenditure management and structural reforms.
“We stand ready if needed. But for now, that decision was not made,” Daves de Sousa said.
The World Bank has also supported Angola’s fiscal consolidation efforts, recently approving a guarantee for a “debt-for-education” swap designed to help finance new school construction projects. The government expects to complete the transaction by June.
Angola has already secured about $2.9 billion of the $3.8 billion in external financing it is targeting this year, the minister said. Remaining funds are expected to come from a mix of bilateral partners and market borrowing, although authorities are reassessing revenue projections to determine whether less external debt will ultimately be required.
Despite concerns over debt levels, officials said the country’s oil sector continues to provide a critical buffer against external shocks. Oil export revenues remain the backbone of Angola’s fiscal and external accounts, helping to stabilise growth even as non-oil sectors face pressure from global uncertainty.
The finance minister said economic growth could hold at around 4 percent this year, broadly in line with earlier forecasts, as expansion in the oil sector offsets weaknesses in other parts of the economy.
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“We are working on scenarios, looking at mitigation measures,” she said. “We are an oil exporting country, we expect to see some windfall and to see how we can use that windfall to speed up some expenditures that are beneficial to our citizens.”
At the same time, the government is continuing a gradual reduction of fuel subsidies, part of a long-running reform agenda aimed at improving fiscal discipline. While subsidies on jet fuel have already been eliminated, officials said the timing of further cuts is still under review.
The policy balancing act highlights Angola’s reliance on hydrocarbons at a time of global instability, with higher oil prices simultaneously easing fiscal pressure while reinforcing the country’s exposure to volatile energy markets.
For now, officials say the immediate focus is on managing debt, securing external financing on favourable terms and leveraging the oil windfall to support social spending without undermining longer-term fiscal stability.
