Will Angola sustain economic growth?

Angola's economy has recently shown signs of recovery, with a 4.1 per cent growth recorded in the second quarter of this year compared to the previous period's 0.5 per cent increase. Despite a slight softening from previous figures, this marks the 14th successive quarter of economic growth for the country. Rhode Luemba, Head of Flow Sales, Global Market at Standard Bank Group, provided insights into the GDP report and shared his views on the key takeaways. Luemba highlighted the positive outcome of the GDP growth, which defied expectations of a slower growth rate due to inflation concerns. The diamond sector saw significant growth of 62.5%, while the oil sector continued to face challenges with a growth rate of 2.6% year-on-year. However, the agricultural sector accelerated by 4.2%, indicating potential for further growth in non-oil sectors going forward. Luemba emphasized the importance of stabilizing the local currency, Kwanzaa, to contain inflation. Despite the economy's reliance on oil exports and imports, efforts to diversify and increase local production have led to slight appreciation of the Kwanzaa against major international currencies. Recent interventions from the central bank have helped reduce exchange rate volatility and support key import sectors like food and medicine. Turning to Nigeria, Luemba discussed the recent monetary policy decisions and the Central Bank's proactive stance on tightening to address persistently high inflation. The increase in the monetary policy rate to 27.25% indicates a cautious approach to preempt potential inflationary pressures from external factors such as flooding and rising energy prices. Overall, Luemba's analysis underscores the resilience of Angolan economy and the importance of strategic policy measures to sustain economic growth amidst global uncertainties.