Oil, diamonds fuel growth in Angola

JOHANNESBURG – South Africa’s Stanbic Bank said yesterday that surging crude prices would push oil-rich Angola’s economic growth higher than it originally forecast.

It said it had revised its real gross domestic product growth estimate for Angola to 11 per cent in 2004 from 6,5 per cent. That compared with 4,5 per cent last year.The bank said in a research note that higher diamond production would also help as the southwest African country struggles to its feet after almost three decades of devastating civil war.However its estimate was still below the International Monetary Fund’s, which has forecast Angola’s growth at 12,8 per cent in 2004.The Fund estimates that Angola’s economy will expand by an average of 11,6 per cent per year between 2003 and 2008, making it Africa’s fastest growing economy.Stanbic is the Africa trading arm of Standard Bank of South Africa – one of the country’s four top banks.It has a presence in some 17 African countries and its views on the continent’s economies are among the most authoritative.Stanbic also said that oil production averaged 925 000 barrels per day (bpd) in April and was expected to reach 965 000 bpd in 2004 from 880 000 bpd in 2003.Angola has more than 10 billion barrels of proven oil reserves.Stanbic said infrastructure rehabilitation had boosted the construction sector and growth in telecommunications and trade were driving services but it added economic activity was still dominated by oil production and diamond mining.”In the diamond industry, output is expected to surge to 15 million carats in 2005 from 5 million carats in 2003 on the back of new diamond mines coming into operation – 14 of them in 2004 – and the resumption of diamond production operations by Endiama, the state-owned company,” Stanbic said.Efforts to improve governance and transparency by Angola appeared to be winning favour with multilateral agencies and other international lenders, which could pave the way for future budgetary assistance and debt relief, Stanbic said.Under pressure from the IMF and World Bank, Angola has agreed to declare all oil revenues in its national budget.-Nampa-ReutersThat compared with 4,5 per cent last year.The bank said in a research note that higher diamond production would also help as the southwest African country struggles to its feet after almost three decades of devastating civil war.However its estimate was still below the International Monetary Fund’s, which has forecast Angola’s growth at 12,8 per cent in 2004.The Fund estimates that Angola’s economy will expand by an average of 11,6 per cent per year between 2003 and 2008, making it Africa’s fastest growing economy.Stanbic is the Africa trading arm of Standard Bank of South Africa – one of the country’s four top banks.It has a presence in some 17 African countries and its views on the continent’s economies are among the most authoritative.Stanbic also said that oil production averaged 925 000 barrels per day (bpd) in April and was expected to reach 965 000 bpd in 2004 from 880 000 bpd in 2003.Angola has more than 10 billion barrels of proven oil reserves.Stanbic said infrastructure rehabilitation had boosted the construction sector and growth in telecommunications and trade were driving services but it added economic activity was still dominated by oil production and diamond mining.”In the diamond industry, output is expected to surge to 15 million carats in 2005 from 5 million carats in 2003 on the back of new diamond mines coming into operation – 14 of them in 2004 – and the resumption of diamond production operations by Endiama, the state-owned company,” Stanbic said.Efforts to improve governance and transparency by Angola appeared to be winning favour with multilateral agencies and other international lenders, which could pave the way for future budgetary assistance and debt relief, Stanbic said.Under pressure from the IMF and World Bank, Angola has agreed to declare all oil revenues in its national budget.-Nampa-Reuters