Tue, 25 Aug 2020 13:54 - Updated Tue, 25 Aug 2020 13:56
Angola may benefit from USD 2.6 billion moratorium
Luanda - Angola may stop paying USD 2.6 billion in debt payment this year alone, which corresponds to 3.1 percent of last year?s GDP, according to the Fitch Ratings financial rating agency.
Send by email
To share this news by email, fill out the information below and click Send
To report errors in the texts of articles published, fill out the information below and click Send
Photo: Foto: Angop
Angola will be the most benefitted country from a possible extension of the G20 Debt Service Suspension Initiative (DSSI), and could “save” 4.3 percent of GDP.
According to the payments due data published by the World Bank, only five of the 22 countries that Fitch evaluates and that are eligible to participate in the DSSI, would see funding requirements for this year reduced by more than one percent, with the highest benefit for Angola, at 4,3 percent.
The data are contained in the report on the impact of the accession of the most vulnerable countries to the G20 initiative.
In document reached Lusa news agency, Fitch Ratings says that of these countries (Angola, Mozambique, Republic of Congo and Laos), only Laos did not apply for the initiative organised in April, and intend to suspend payments of official bilateral debt until the end of this year.
In November it may be extended to the end of 2021, due to the impact of the novel coronavirus pandemic on the most fragile economies.
“An extension of the G20 DSSI to emerging market countries is likely, possibly at the November meeting, which would amplify the benefits of this initiative”, write the analysts at Fitch Ratings, which is owned by the same owners as Fitch Solutions.
So far, more than 40 countries, including Cape Verde and São Tomé and Príncipe, have asked to participate in this initiative, which does not cover debt to private creditors, which would be dealt with separately.
“The G20 encouraged private sector investors to provide debt relief along lines similar to the relief provided under the DSSI, but this is not a requirement for participation,” notes the Fitch.
The note adds that “up to now none of the countries participating in the DSSI has said publicly that they would try to have similar treatment from private creditors, which partly reflects concerns about access to financial markets”.
With the exception of Moody's, the other two main rating agencies consider that participation in the initiative does not necessarily imply a downgrade of the rating, but Moody's argues that participation implies a weakening of the financial position and, therefore, a downgrade of the rating.
“The Debt Service Suspension Initiative focuses only on debt to official creditors, which is not covered by Fitch’s definition default”, says the analysts.
- 24/08/2020 09:47:10
Luanda -The French oil company Total announced Sunday the resumption of offshore drilling in Angola through the Skyros platform.
- 21/08/2020 12:02:10
Luanda - The Banco de Comércio e Indústria (BCI) is part of the Central Securities of Angola - CEVAMA, with the share capital set at 67.7 billion Kwanzas.
- 21/08/2020 08:44:18
Luanda - The Executive Committee of the Angolan Stock Exchange (BODIVA) highlighted this Thursday in Luanda the management capacity that Cristina Lourenço demonstrated in the process of creating and implementing a structure unit of the Ministry of Finance.