Angola to get USD 6.2 billion debt relief from major creditors, says IMF

The International Monetary Fund (IMF) said in a report that Angola will receive USD 6.2 billion in debt relief over the next three years thanks to agreements lined up with three of its major creditors, according to a news report by CGTN Africa.

On Friday, Angola said it was close to striking debt agreements with a number of Chinese banks and government agencies.

The African oil exporter has buckled under a rising debt burden following a sharp decline in crude prices and amid the economic fallout from the coronavirus pandemic.

"Although debt is sustainable, significant vulnerabilities remain,” the IMF said in its report. “Debt dynamics are highly sensitive to further oil-price volatility."

In a letter included in the report, the Angolan government, which has already sought relief from official bilateral creditors under an initiative backed by the Group of 20 (G20) wealthy economies, acknowledged its precarious position.

"To the extent that unforeseen risks to achieving the medium-term debt target materialize, we will act to mitigate those risks, including by seeking additional debt relief from a wider group of creditors," it said.

Private sector participation in debt relief has become a hotly debated issue ahead of a decision by the G20 on whether to extend debt payment holidays beyond 2020.

While the World Bank has pushed for private creditors to shoulder some of the burdens of debt relief, investors as well as some governments have argued this would endanger their access to international capital markets.