IN a recent meeting in Luanda, Angola’s President João Manuel Lourenço and African Development Bank (AfDB) President Dr Akinwumi Adesina discussed the sweeping economic reforms Angola is implementing to diversify its economy, reduce debt, and create jobs for its youth. The meeting, held on September 20, marked a significant step in Angola’s journey towards sustainable growth and financial stability.
Economic reforms and debt reduction
Dr Akinwumi Adesina praised Angola’s progress in tackling its debt burden, which has dropped from 119 pereent of GDP in 2020 to a projected 58 percent this year. ‘What you have done to reduce public debt is impressive,’ Adesina said, highlighting the nation’s resilience in the face of external economic shocks. He also noted that Angola’s GDP, currently growing at 2.7 percent, is expected to rise to 4.3 percent by 2025, driven by these bold reforms.
The African Development Bank has committed to supporting Angola’s ongoing reforms, with Adesina announcing a $160 million budget support package for 2024, with a second tranche expected in 2025. This financial backing will help Angola maintain its reform momentum, particularly in promoting private sector-led growth and diversifying away from the oil sector.
Job creation and youth employment
President Lourenço is also focusing on human capital development as part of Angola’s National Development Plan for 2023-2027. With half of Angola’s 35 million population under the age of 25, and 40 percent of youth currently unemployed, creating jobs has become a priority. Around 550,000 young people enter the workforce each year, intensifying the need for sustained job creation efforts.
The African Development Bank’s recently approved $124 million project, locally known as CRESCER, is aimed at empowering young entrepreneurs. This initiative brings together financial institutions and entrepreneurial associations to create tailored solutions for young business owners. Additionally, the AfDB has offered to help Angola establish Youth Entrepreneurship Investment Banks, similar to those successfully launched in Liberia and Ethiopia.
Agricultural transformation
With 35 million hectares of fertile land, Angola has immense agricultural potential. Both President Lourenço and Adesina agreed that the country should focus on achieving food security and reducing its reliance on food imports, which cost $2bn annually.
Adesina emphasised the need for Angola to become self-sufficient in food production and even a net exporter. ‘Angola has no business spending $2 billion per annum importing food,’ he said. The AfDB currently has $212 million invested in Angola’s agricultural sector, with an additional $100 million being finalised to boost production in the eastern regions of the country.
The Bank also pledged to support Angola in scaling up fertiliser use, domestic production, and establishing Special Agriculture Processing Zones, which are already operational in 11 other African nations.
Harnessing hydro energy
Angola’s potential extends beyond agriculture, as the country possesses vast untapped hydro energy resources. Adesina noted that Angola is ‘sitting on a gold mine of clean hydro energy,’ with 1.5GW of unused energy available and an expected increase to 3.5GW by 2027. With the right investment from the private sector, Angola could become a key provider of power to neighbouring countries such as Zambia, Namibia, and South Africa.
Attracting investment
To further boost private sector involvement, Angola is preparing to present nearly $2bn worth of projects at the Africa Investment Forum in Rabat, Morocco, this December. These projects are designed to attract significant international investment, driving Angola’s economic growth and enhancing its infrastructure.
Strengthening ties with the AfDB
Angola has been a strong supporter of the African Development Bank, contributing €6.5 million to the Bank’s concessional fund in each of the last three replenishments. During his visit, Adesina met with Angola’s Finance Minister Vera Daves De Sousa and Minister for Planning Victor Hugo Guilherme, and toured the Luanda Science and Technology Park, a $90 million project funded by the AfDB.
Accompanied by senior officials, including Leila Mokaddem, Director General for the AfDB’s Southern Africa Region, Adesina reaffirmed the Bank’s commitment to supporting Angola’s reforms and long-term economic transformation.
As Angola continues to implement its wide-ranging economic reforms, the support from the African Development Bank will play a critical role in fostering sustainable development, creating jobs, and ensuring food and energy security for the nation’s growing population.
