The consultancy Fitch Solutions today upgraded Angola's growth estimate from 3.5% to 4% this year, but predicts that economic expansion will slow in 2023 to 1.8% due to difficulties in the oil sector.

"At Fitch Solutions, we forecast Angola's Gross Domestic Product (GDP) to grow by 4% in 2022, compared to an estimated 0.6% in 2021, which shows an upward revision from our previous projection of 3.5%, made to reflect higher than expected growth in the second quarter," reads an analysis note on the Angolan economy.

For the analysts at Fitch Solutions, which is owned by the same people who run the financial rating agency Fitch Ratings, the revised growth forecast for this year is based on "a combination of lower inflation and better monetary conditions, in addition to gains in the oil sector, which will accelerate growth in general this year."

In the note sent to clients, to which Lusa has had access, Fitch Solutions points out, however, that the forecast for 2023 is for a slowdown, essentially due to the "headwinds in the national oil sector".

Production is expected to fall by 3.5% due to chronic underinvestment and the fact that wells are running out, plus the fall in prices, which will amplify the effect of lower production.

Thus, they conclude, it will be the non-oil sector, mainly, that will sustain growth, with inflation falling to 14% and the National Bank of Angola cutting its benchmark interest rate to 17% by the end of the year. (Lusa)