August 20, 2018 / 5:18 PM / 3 months ago

UPDATE 1-Angola seeks IMF financial support as growth lags

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LUANDA, Aug 20 (Reuters) - Angola’s finance ministry said on Monday that it has sought financial support from the International Monetary Fund due to poorer than expected economic growth this year.

The statement on the ministry’s website did not say how much the Extended Fund Facility would be worth, nor did it give a new growth forecast.

It said the IMF has been invited to Luanda in October to negotiate the programme, which would last for two years and then be extendable for one more.

Angola asked for assistance from the IMF back in April, but this had originally not involved any financing.

“In light of the recent economic developments...the government requested the adjustment of the assistance programme with the IMF, adding to it a financial component,” the finance ministry statement said, adding that the money would help reform and diversify the country’s economy.

Angola’s economy continues to struggle due to lower oil prices, a situation made worse by declining production. Output is expected to fall to 1.5 million barrels per day in 2018, down from 1.6 million last year and 1.9 million a decade ago.

The IMF expects the southwestern African country’s economy to grow 2.2 percent this year, well below the original government forecast of 4.9 percent.

President João Lourenço, who took over last September after 38 years of rule by José Eduardo dos Santos, has said he wants to bring about an economic miracle in Angola by opening up to foreign investment and diversifying away from oil, which accounts for over 90 percent of exports. (Reporting by Stephen Eisenhammer Editing by Mark Heinrich)

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