Luanda, Jan. 27, 2025 (Lusa) - The head of Angola's public debt management unit (UGD) on Monday rejected the idea that the country has defaulted, refusing to give further details on the case which is being heard by an arbitration court because it is still in dispute.
Dorivaldo Teixeira was responding today to questions raised last week by an article in the Financial Times about a sanctioned creditor who claimed that Angola had defaulted on the financing it had received, which led to arbitration proceedings.
The ministry of finance (Minfin) has refused to reveal which creditor, or group of creditors, has been the target of international sanctions and has placed the country in an arbitration process over the debt, the figure for which is also undisclosed.
Responding to journalists during the presentation of the Annual Debt Plan, the director-general of the UGD indicated that in the Base Prospectus published on the London Stock Market on 20 December 2024, ‘possible’ information was shared, due to the fact that the case is still under litigation and the identification of the creditor could be used against the Angolan state.
"We released the prospectus for the sake of transparency, so that people know what is happening, but it is a risk that is under control," he emphasised.
"If the decision is that the state has to pay, we, as a good organisation, will create the conditions and we will pay. We're not publicising the entity for the protection of the state, not publicising it is the best we can do, not least because of the legal advice we've received," he continued.
Dorivaldo Teixeira guaranteed that this was not a default incident: "if you default on a financing line, you activate a cross default clause and when you activate this clause you don't just resolve the issue of a specific creditor, you have to bring all the creditors to the table to discuss it with them and find a solution that is balanced for everyone, which is the case with some countries in the region," he said.
In last week's article, the Financial Times begins by ironising, asking ‘who are you, creditor?’ and adds: ‘We know you exist, because Angola recently used a prospectus for the issue of almost US$2 billion in debt securities to bury the unfortunate detail that someone had accused the country of defaulting’."
The ministry of finance reacted to the article by reiterating, in a statement, its commitment "to national and international creditors as set out in the state budget" and ends by showing itself "confident in the sustainability of its debt" and saying that it "will continue to implement its debt strategy and economic diversification plan with focus".
The finance ministry's response came after several articles in recent days reported on Angola's growing cash flow and liquidity difficulties, materialised, for example, in the postponement of the payment of civil servants' raises from January to March and the increase in the amount of debt by US$728 million (€699 million) until 2030, just a few weeks after a US$2 billion issue in exchange for a loan of US$400 million (equivalent to €384 million).
In November alone, Angola faces a repayment of US$864 million (almost €830 million) in debt.
Angola will have to pay US$6.2 billion (5.9 billion euros) in 2025, representing 5.2% of GDP, and US$5.4 billion ( €5.1 billion) in 2026, representing 4.2% of GDP, which compares with the US$5.4 billion paid in 2024, says Fitch Ratings in a recent analysis of the Angolan economy, presenting these figures as the total debt that will be paid in these years, which includes interest and payments at the maturity of the loans.
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