August 28, 2017 / 3:36 PM / a year ago

Angola to issue $2 bln Eurobond - finance ministry

LUANDA, Aug 28 (Reuters) - Angola is in talks with banks to issue $2 billion worth of Eurobonds, its Finance Ministry said on Monday, as Africa’s second largest crude producer looks to raise money in the midst of an economic crisis caused by a fall in the price of oil.

The Finance Ministry said in a statement the purpose of the Eurobond issuance was to help lengthen the maturities of Angola’s debt and provide a reference point for national borrowers looking to access international markets.

No bank has yet been selected to lead the debt issuance, it said, denying media reports that Russian bank VTB Bank PJSC had already been chosen.

“This process has several strategic objectives, namely the extension of the debt profile and the creation of a reference price for national agents,” the finance ministry said.

The debt issuance was approved Aug. 4 by presidential decree. Angola first issued a Eurobond in October 2015.

After years of rapid oil-fueled growth, averaging 7.2 percent between 2003 and 2015, Angola’s economy shrunk 3.6 percent last year, according to government data published in April but later removed from its website.

Following elections last week, a new president will take office in September, replacing Jose Eduardo dos Santos who ruled Angola for 38 years. Provisional results released on Friday gave a resounding victory to the ruling MPLA party and its presidential candidate, João Lourenço.

Lourenço has promised to revive the country’s economy by diversifying away from oil and attracting more foreign investment. He has not ruled out negotiating a deal with the World Bank or the International Monetary Fund. (Reporting by Stephen Eisenhammer; Editing by James Macharia)

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