Angola is tapping international lenders for roughly $1 billion of new loans, including one for food and medicine, as Africa’s biggest oil producer tries to cope with the fall in global crude-oil prices.
Goldman Sachs Group Inc. is arranging a syndicated loan that is partly guaranteed by the World Bank, while London investment firm Gemcorp Capital LLP is separately providing dollar financing to the country to import food, medicine and other necessities, people familiar with the loans said this week.
The fresh funds signal that investors are confident Angola can ride out the oil slump that took hold two years ago, and come as the country awaits a potential $4.5 billion from the International Monetary Fund. A halving in crude prices has cut Angola’s government revenues and economic growth in half, prompting drastic government-spending cuts and creating a shortage of dollars in the country.
Angola draws nearly all of its export earnings and 80% of government revenue from crude sales. It surpassed Nigeria as the continent’s top oil producer this year thanks to attacks by militants on pipelines and rigs in the Niger Delta.
The syndicated loan Goldman Sachs is working on builds upon a commitment the World Bank made a year ago to support Angola in reforming and diversifying its economy with a $450 million loan and a $200 million guarantee. Goldman Sachs is now structuring a syndicated loan that will encompass that $200 million guarantee for a loan of roughly $500 million to $600 million, a person familiar with the matter said.
The World Bank said no one was available on Thursday to comment.
The Gemcorp facility could reach hundreds of millions of dollars in size depending on the government’s needs to import specific goods into the country, people familiar with that loan said.
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