angola s economy past present and future l.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
Angola’s Economy: Past, Present and Future PowerPoint Presentation
Download Presentation
Angola’s Economy: Past, Present and Future

Loading in 2 Seconds...

play fullscreen
1 / 69

Angola’s Economy: Past, Present and Future - PowerPoint PPT Presentation


  • 460 Views
  • Uploaded on

Angola’s Economy: Past, Present and Future . Ricardo Gazel, World Bank Senior Economist and Acting Country Manager Viking Club August 27, 2009. Angola’s Economy: Past, Present and Future. Recent Past: High Rates of Growth

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Angola’s Economy: Past, Present and Future' - salena


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
angola s economy past present and future

Angola’s Economy: Past, Present and Future

Ricardo Gazel, World Bank

Senior Economist and Acting Country Manager

Viking Club

August 27, 2009

angola s economy past present and future2
Angola’s Economy: Past, Present and Future
  • Recent Past: High Rates of Growth
  • Present: The Mother of all Crisis and the Impacts on Angola’s Economy
  • Future: Medium and Long Runs
i recent past high rates of growth
I. Recent Past: High Rates of Growth
  • 1.1 Economic Growth
  • 1.2 Inflation
  • 1.3 External Sector
  • 1.4 Public Sector
  • 1.5 Social Gains
i recent past high rates of growth5
I. Recent Past: High Rates of Growth
  • 1.1 Economic Growth
  • 1.2 Inflation
  • 1.3 External Sector
  • 1.4 Public Sector
  • 1.5 Social Gains
i recent past high rates of growth7
I. Recent Past: High Rates of Growth
  • 1.1 Economic Growth
  • 1.2 Inflation
  • 1.3 External Sector
  • 1.4 Public Sector
  • 1.5 Social Gains
i recent past high rates of growth13
I. Recent Past: High Rates of Growth
  • 1.1 Economic Growth
  • 1.2 Inflation
  • 1.3 External Sector
  • 1.4 Public Sector
  • 1.5 Social Gains
i recent past high rates of growth17
I. Recent Past: High Rates of Growth
  • 1.1 Economic Growth
  • 1.2 Inflation
  • 1.3 External Sector
  • 1.4 Public Sector
  • 1.5 Social Gains
social gains in the last years
Social Gains in the Last Years
  • Reduction of Poverty
  • Improved Human Development Indicators
  • Gains in the fight agains HIV/AIDS, malaria, etc.
angola s economy past present and future19
Angola’s Economy: Past, Present and Future
  • Recent Past: High Rates of Growth
  • Present: The Mother of all Crisis and the Impacts on Angola’s Economy
  • Future: Medium and Long Runs
the mother of all crisis
The Mother of all Crisis
  • Financial Crisis:
    • Stock Markets Collapsed in many Advanced and Developing Countries
    • Nacionalization of Fannie Mae and Freddie Mac
    • Bancrupcy of Banks and Insurance Companies
    • Liquidity Crisis
    • Others
impacts in angola
Impacts in Angola
  • Financial Market and Foreign Investment
  • Remitances and Foreign Aid
  • Real Economy – Prices of Primary Products
financial market and foreign investment
Financial Market and Foreign Investment
  • Likely small as:
    • No stock market
    • No strong connection of domestic bank system with international financial markets (except via Portuguese banks)
    • Small interbaking credit market
    • Low loans to deposit ratios
impacts in angola24
Impacts in Angola
  • Financial Market and Foreign Investment
  • Remitances and Foreign Aid
  • Real Economy – Prices of Primary Products
remessas e ajuda extrangeira
Remessas e Ajuda Extrangeira
  • Low Level os Remitances compared to other African Countries
  • Outflow Remitances Larger than Inflow Remitances
  • Foreign Aid share of Budget is Marginal
impacts in angola26
Impacts in Angola
  • Financial Market and Foreign Investment
  • Remitances and Foreign Aid
  • Real Economy – Prices of Primary Products
real economy
Real Economy

Economic Growth

Inflation

External Sector

Public Sector

Risks

others sectors
Others Sectors
  • Sector Positive Negative
  • Agriculture and Fishing High
  • Extractive Industries Low
    • Oil and Gas Low
    • Diamants e other extractives High
  • Manufacturing Low
  • Construction Low
  • Services Medium
real economy32
Real Economy

Economic Growth

Inflation

External Sector

Public Sector

Risks

inflation35
Inflation
  • In favor of a decline:
    • Decline in International Prices
    • Domestic Economic Slowdown
  • In favor of an increase:
    • Devaluation of the Kwanza
    • Supply Constraints
real economy36
Real Economy

Economic Growth

Inflation

External Sector

Public Sector

Risks

external sector
External Sector
  • Dramatic Decline of Export Revenues
  • Limited Decline of Imports (Less elastic in the short run)
  • Current Account Deficit
  • Sharp Decline in International Reserves
  • Cash Flow Problems with Balance of Payments
  • Financing Needs
real economy41
Real Economy

Economic Growth

Inflation

External Sector

Public Sector

Risks

public sector
Public Sector
  • Lower Revenues
  • Drastic Cuts in Spending
  • How to Finance the Deficit?
    • High Cost, low demand for government bonds
real economy44
Real Economy

Economic Growth

Inflation

External Sector

Public Sector

Risks

risks
Risks
  • Global Recession
  • Fiscal and Monetary Policies
    • Fiscal Policy:
      • Budget Adjustments
      • Payment Delays to Suppliers
      • Financing the Fiscal Deficit (High Cost)
    • Monetary and Exchange Rate Policies:
      • Required Reserves
      • Exchange Rate policy
  • Social Impacts
social impacts
Social Impacts
  • Increase in Poverty
  • Worsening of Human Development Indicators
  • Potential increase in hunger
  • Infant Mortality
  • Political and Social Stress
angola s economy past present and future47
Angola’s Economy: Past, Present and Future
  • Recent Past: High Rates of Growth
  • Present: The Mother of all Crisis and the Impacts on Angola’s Economy
  • Future: Medium and Long Runs
prespectives for the futuro medium run
Prespectives for the Futuro:Medium Run
  • At the Global Level:
    • Bad News: Recession in 2009 and increased unemployment. Price of OIL?
    • Good News: Some indicators show improvements and that the crisis may have hit bottom, but recovery will be slow
  • In Angola:
    • Prepare for the Future
    • Diversification
    • Reforms
diversification
Diversification
  • Why?
  • Where is Angola?
  • How to Diversify?
  • Challenges: How to surpass them
slide51
Why?
  • High Dependency on Oil:
    • 56% dof GDP in 2007
    • 97% of Exports in 2007
    • 83% of Government Revenues in 2008
  • Instability: Price is very volatile
  • Oil Sector is technology intensive and does not creat many jobs
diversification52
Diversification
  • Why?
  • Where is Angola?
  • How to Diversify?
  • Challenges: How to surpass them
baixo grau de diversifica o
Baixo Grau de Diversificação
  • Composição (%) 2006 2007 2008
  • Agriculture and Fishing 7,3 7,7 8,2
  • Extractive Industries 58,0 57,6 59,4
    • Oil and Gas 55,7 55,8 58,3
    • Diamants and other extractives 2,3 1,8 1,2
  • Manufacturing 4,8 5,3 6,6
  • Electrical Energy 0,1 0,1 0,1
  • Construction 4,3 4,9 4,4
  • Services (Mercantil) 16,8 16,9 15,3
  • Others 8,3 7,2 6,1
diversification54
Diversification
  • Why?
  • Where is Angola?
  • How to Diversify?
  • Challenges: How to surpass them
how to deversify
How to Deversify?
  • Identification of Sector with Comparative Advantages
  • Identification of Barriers
  • Incentives and Reforms
setores com vantagens comparativas
Setores com Vantagens Comparativas
  • Agriculture
  • Construction: Infrastructure and housing
  • Light Manufacturing: Plastic, agrobusiness
  • Manufacturing: Cement, Construction materials, etc.
  • Services in general
diversification is a process
Diversification is a Process
  • Exemple: Agriculture
    • Steps:
      • Deminization
      • Recuperation and construction of infrastructure
        • Roads and bridges
        • Water and electricity
        • Others
      • Realocation of Displaced rural population during the war
      • Distribution and preparation of land
      • Seed distribution
      • Logistic Support: Extention, Credit, distribution of production, etc.
how to deversify58
How to Deversify?
  • Identification of Sector with Comparative Advantages
  • Identification of Barriers
  • Incentives and Reforms
barriers
Barriers
  • Infrastructure: Energy and Water
  • Labor Force
  • Transportation
  • Ports
  • Low Institucional Capacity
  • Limited Credit
  • Limited Domestic Comsumption Markets
how to deversify60
How to Deversify?
  • Identification of Sector with Comparative Advantages
  • Identification of Barriers
  • Incentives and Reforms
incentives
Incentives
  • Fiscal
  • Credit
  • Joinventures
  • PPPs
reforms
Reforms
  • Fiscal
  • Labor
  • Regulations
  • Public Sector: More Efficiency
diversification63
Diversification
  • Why?
  • Where is Angola?
  • How to Diversify?
  • Challenges: How to surpass them
challenges
Challenges
  • Short Run
    • Maintain Macro Stability in a scenario of global crisis
  • Medium and Long Run
    • Increase Competitiveness:
      • Lower Cost of Production (transportation, credit)
      • Increase Factor Productivity
angola s economy past present and future65
Angola’s Economy: Past, Present and Future
  • Recent Past: High Rates of Growth
  • Present: The Mother of all Crisis and the Impacts on Angola’s Economy
  • Future: Medium and Long Runs
angola 2020
Angola 2020
  • Higher Participation of the Private Sector
  • Labor Force with more skills
  • Exports more diversified
  • Agriculture: Domestic and External Markets
  • More sofisticated Syestem of Credit
  • Public Sector more efficient
  • Public Investment more selective and criterious
angola 2020 how to get there
Angola 2020How to get there
  • Fiscal and Monetary Policies Consistent with Macro estability
  • Investiment in Social Sectors: education and Health
  • Modern and Comprehensive Infrastructure
  • Reforms implemented (labor, public sector, contracts, justice, etc.)
  • Flexible Exchange Rate
  • Expanded Domestic Market