Angola GDP Q2 2023

Angola: Economy flatlines in the second quarter

GDP flatlined year on year in the second quarter, below the 2.8% expansion seen in the first quarter. Q2’s reading marked the worst result since Q1 2021. On a seasonally adjusted quarter-on-quarter basis, GDP increased 0.2% in Q2, contrasting the previous quarter’s 1.1% contraction.

The all-important oil sector posted a 2.9% year on year contraction in Q2 (Q1: -8.0% yoy). Oil output improved in the period as production in the Dalia field bounced back after maintenance work. However, operational issues in the Belize and Ndungu fields weighed on the overall outturn.

Meanwhile, growth in the non-oil sector fell to 1.2% year on year in Q2, down from 3.1% in Q1. The deceleration was driven by softer growth in the manufacturing, communication and transportation sectors. On the flip side, agriculture, construction and trade output expanded at a faster pace.

Our panelists see the economy growing again in H2, supported by a stronger oil sector relative to the first half of the year. That said, a faster-than-expected pickup in inflation—stemming from the reduction in fuel subsidies from June and a weaker kwanza—poses a downside risk. Oil prices, Treasury and Central Bank interventions in FX markets, and the evolution of the El Niño weather phenomenon are key factors to monitor.

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