Angola Business Confidence Q1 2020


Angola: Economic sentiment sours in Q1

July 6, 2020

The economic climate indicator (ICE, Indicator de Clima Económico) dropped to minus 16 in the first quarter from minus 4 in the fourth quarter of last year. The print marked the lowest reading since Q3 2018 and highlights that the economic backdrop deteriorated with the onset of Covid-19, as the recession worsened in the first quarter and with worse expected to have come in the second quarter.

Sector-level data showed that the deterioration in business sentiment was broad-based as all sectors of the economy recorded a drop in confidence. Confidence levels in the manufacturing; construction; trade; transport; and tourism fell deeper into pessimistic territory and are all currently below their respective long-term averages, except for tourism. Sentiment in the mining sector, meanwhile, fell from optimism to pessimism in the quarter, but matched its long-term average.

Looking ahead, economic sentiment is likely to have deteriorated further in the second quarter given the expected worsening of the economic slump at the hands of Covid-19 and collapsing oil prices.

FocusEconomics see GDP shrinking 3.9% in 2020, which is down 0.6 percentage points from last month’s forecast. In 2021, the economy is seen expanding 0.7%.

Author:, Economist

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Angola Business Confidence Chart

Angola Business Confidence Q1  20 20

Note: Economic Climate Indicator (ICE, Indicador de Clima Económico)
Source: National Statistical Institute (INE, Instituto Nacional de Estatística)

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