Angola issues $1.5 billion Eurobond as oil revenues decline

28 Oct 2015
Chibuike Oguh


The debt has a Ba2 rating from Moody’s and B+ from Standard & Poor’s and Fitch.

Angolan President José Eduardo dos Santos Source: AFP/Getty

Angola, sub-Saharan Africa’s second largest exporter of oil, issued its first $1.5 billion Eurobond on the London Stock Exchange last Thursday.

A statement from Angola’s finance ministry stated that the country issued the sovereign debt to raise alternative sources of credit apart from bilateral and commercial funds.

Angola has hired Deutsche Bank, Goldman Sachs and ICBC International to arrange meetings with U.S. and European investors. The debt has a Ba2 rating from Moody’s and B+ from Standard & Poor’s and Fitch.

Much like other oil-producing countries such as Nigeria, Angola has been adversely affected by the slump in oil prices. Angola’s oil revenues have fallen by more than 50 percent and its currency has dropped by more than 30 percent, according to the finance ministry.

Earlier in October, the Angolan government announced it was cutting public investment by 53%. In a state-of-the-nation address in the Capital, Luanda, the Angolan Vice President, Manuel Vicente, said the country's debt is estimated to reach 45.8% of GDP.

The International Monetary Fund has said that Angola's economic growth is likely to slow to an average of 3.5 percent a year between 2015 and 2016 from about 4 percent last year.

Angola is the fifth-largest economy in Africa after Nigeria, South Africa, Egypt and Algeria.

Chibuike Oguh is Financial Nigeria's Analyst of the Frontier Markets

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