## IMF Executive Board Completes the Third Review of Angola’s Extended Arrangement Under the Extended Fund Facility and Augments Disbursement to Address the Impact of COVID-19 _IMF News, September 16, 2020_ ## Source details **Canonical URL:** [IMF Executive Board Completes the Third Review of Angola’s Extended Arrangement Under the Extended Fund Facility and Augments Disbursement to Address the Impact of COVID-19](https://www.imf.org/en/news/articles/2020/09/16/pr20294-angola-imf-execboard-complete-3rdrev-ea-under-eff-augment-disbursement-address-covid19) ## Other formats - [Markdown version](/en/news/articles/2020/09/16/pr20294-angola-imf-execboard-complete-3rdrev-ea-under-eff-augment-disbursement-address-covid19/index.md) - [Structured JSON version](/en/news/articles/2020/09/16/pr20294-angola-imf-execboard-complete-3rdrev-ea-under-eff-augment-disbursement-address-covid19/index.json) - [Bundle manifest](/en/news/articles/2020/09/16/pr20294-angola-imf-execboard-complete-3rdrev-ea-under-eff-augment-disbursement-address-covid19/bundle-manifest.json) ## Bibliographic details - Published: September 16, 2020 --- ### Disbursement and Access - Immediate disbursement unlocked: SDR 731.7 million (about US$1 billion). - Total disbursements under the extended arrangement after the review: SDR 1,804.7 million (about US$2.5 billion). - Original three-year extended arrangement approved on December 7, 2018: SDR 2.673 billion (about US$3.7 billion at the time of approval). - Augmentation of access approved: 72 percent of Angola’s quota (SDR 540 million or about US$765 million). ### Context: Shocks to the Economy - Angola hit by a triple, COVID-19-induced external shock, including: - Economic and health crises from the COVID-19 pandemic. - Decline in oil prices, compounded by Angola’s dependence on oil exports. - Authorities described as having adopted timely and decisive measures and remaining strongly committed to the program, including the fight against corruption. ### Fiscal Response - National Assembly adopted a conservative supplementary budget for 2020 that: - Includes non-oil revenue measures. - Compresses non-essential expenditure. - Creates space for essential spending on health and the social safety net. - Fiscal consolidation to continue despite the crisis, while creating space for adequate health and social spending. - Authorities to persevere with measures to strengthen public financial management. ### Monetary and Exchange Rate Measures - Central Bank (National Bank of Angola, BNA) measures to ease liquidity and credit constraints to help the private sector cope with the crises. - BNA has continued to reform the exchange rate regime, including migrating the bulk of foreign exchange transactions to an electronic platform. - Guidance: Efforts should continue to remove constraints toward reaching a market-clearing exchange rate. - Monetary stance eased to counteract the COVID-19 pandemic and oil-price shock; however, there is little room for further monetary easing and the BNA should be ready to keep inflationary pressures in check. ### Banking Sector and Financial Stability - Timely implementation of banking sector recapitalization and restructuring is essential to address financial sector risks. - Completed asset quality reviews identified shortfalls; authorities are preparing to address capital deficiencies and enhance credit risk management frameworks. - Authorities need to advance the restructuring of two public banks. - Forthcoming BNA and Financial Institutions Laws expected to support stronger bank supervision and resolution. ### Debt and Debt Sustainability - Authorities have secured debt reprofiling agreements from several large creditors to reduce risks related to debt sustainability. - Continued vigilance in managing public debt is critical in the context of heightened oil-price volatility. ### Executive Board Actions, Waivers, and Program Implementation - Executive Board completed the third review of Angola’s program under the Extended Fund Facility (EFF). - Board approved waivers of nonobservance and applicability of performance criteria and modification of some performance criteria, indicative targets, and structural benchmarks. - Program aims at restoring external and fiscal sustainability, improving governance, and diversifying the economy to promote sustainable, private sector-led economic growth. - The authorities remain broadly satisfactorily implementing the program. ### Statement by Deputy Managing Director and Acting Chair Ms. Antoinette Sayeh - Highlights from Ms. Sayeh’s statement: - Authorities remain committed to sound policies under the IMF-supported program despite a deteriorated external environment due to COVID-19. - Adoption of a conservative supplementary budget, measures to increase non-oil revenue, and reining in non-essential expenditure. - Secured debt reprofiling agreements to reduce debt sustainability risks. - Need to continue exchange rate reforms and to remove constraints toward a market-clearing exchange rate. - Emphasis on timely banking sector recapitalization, restructuring, and the importance of forthcoming supervisory and resolution frameworks. - Pursuit of structural reforms to diversify the economy, enhance the business environment, strengthen governance, and fight corruption. *Press Release No. 20/294 — September 16, 2020 — IMF Communications Department* --- ## References - [https://www.imf.org/-/media/images/imf/bios/imfboard.jpg](https://www.imf.org/-/media/images/imf/bios/imfboard.jpg) - [The Executive Board](https://www.imf.org/external/np/sec/memdir/eds.aspx) - [Angola and the IMF](http://www.imf.org/external/country/AGO/index.htm) - [Special Drawing Rights (SDRs) -- A Factsheet](https://www.imf.org/en/about/factsheets/sheets/2023/special-drawing-rights-sdr) - [Press Releases](https://www.imf.org/en/news/searchnews) - [PRESS CENTER](http://presscenter.imf.org/) - [Extended Fund Facility (EFF)](https://www.imf.org/en/About/Factsheets/Sheets/2016/08/01/20/56/Extended-Fund-Facility) - [was approved by the IMF Executive Board on December 7, 2018](https://www.imf.org/en/News/Articles/2018/12/07/pr18463imf-executive-board-approves-extended-arrangement-under-the-extended-fund-facility-for-angola) - [https://www.imf.org/en/Topics/imf-and-covid19/COVID-Lending-Tracker](https://www.imf.org/en/Topics/imf-and-covid19/COVID-Lending-Tracker) - [https://www.imf.org/external/NP/SEC/bc/eng/index.aspx](https://www.imf.org/external/NP/SEC/bc/eng/index.aspx) - [https://www.imf.org/en/home](https://www.imf.org/en/home) _Source: https://www.imf.org/en/news/articles/2020/09/16/pr20294-angola-imf-execboard-complete-3rdrev-ea-under-eff-augment-disbursement-address-covid19_