Publication: Angola Economic Update, July 2025: Boosting Growth with Inclusive Financial Development
Loading...
Other Files
45 downloads
Published
2025-07-28
ISSN
Date
2025-07-28
Author(s)
Editor(s)
Abstract
Angola’s economy rebounded strongly in 2024 with a real GDP growth of 4.4 percent, fueled by a revitalized oil sector and robust performance in non-oil industries like mining, commerce, and agriculture. While macroeconomic stability has been maintained, underlying vulnerabilities persist. Looking ahead, growth is projected to average 2.9 percent from 2025 to 2027, which may not be sufficient to significantly uplift living standards. To address poverty and foster inclusive growth, comprehensive reforms are essential—particularly in financial development and inclusion. Limited financial intermediation continues to hinder households and MSMEs, but the financial sector holds promise for mobilizing private capital and advancing broader policy goals.
Link to Data Set
Citation
“World Bank. 2025. Angola Economic Update, July 2025: Boosting Growth with Inclusive Financial Development. © World Bank. http://hdl.handle.net/10986/43507 License: CC BY-NC 3.0 IGO.”
Digital Object Identifier
Associated URLs
Associated content
Other publications in this report series
Journal
Journal Volume
Journal Issue
Related items
Showing items related by metadata.
Publication Angola Country Economic Memorandum, July 2025: Moving Beyond Oil - Laying the Foundations for Growth and Jobs(Washington, DC: World Bank, 2025-07-28)This Angola Country Economic Memorandum (CEM) analyzes the country’s economic growth over the past two decades and offers insights into its long-term potential. The aim is to identify the main challenges, opportunities, and policy reforms necessary for fostering a more resilient, inclusive, and sustainable growth path. Therefore, this CEM serves as a diagnostic tool to support Angola’s policymakers in advancing the economic diversification agenda outlined in the National Development Plan (NDP) 2023-2027 and the long-term vision. The Angolan economy is gradually transitioning from an oil-based growth model. Angola has implemented a series of reforms to restore macroeconomic stability and promote economic diversification. The extractive nature of Angola’s institutions has contributed to poor economic transformation and inclusion. In this context, transforming and diversifying the economy to create jobs is key to unleashing the country’s potential. This will also reduce poverty and greater resilience to a variety of shocks. In particular, the development of the Lobito Corridor has the potential to accelerate economic diversification in Angola and promote regional integration. Overall, Angola’s current growth model faces three interrelated challenges, each of which represents a loss in potential welfare and thereby an opportunity for reform. These challenges include: (i) recurrent macroeconomic instability; (ii) negative productivity growth; and (iii) low and underutilized physical and human capital. This CEM offers a roadmap to address these challenges and shift Angola toward a more sustainable and inclusive growth model. Such a model makes better use of the country’s existing resources while also laying the foundation for future prosperity.Publication Tanzania Economic Update, July 2015(Washington, DC, 2015-07)This seventh economic update goes to the heart of one of the main challenges faced by Tanzania: how can the country finance its development? This is a fundamental question when aid is coming down as a proportion of a growing GDP, and as access to financial markets remains limited. Oneoption would be to rely more on the private sector to deliver education, health, roads, ports and electricity. This is possible as demonstrated by many such experiences around the world, and therefore this approach needs to be one important part of the solution to finance development. The argument presented in this economic update is that higher tax revenues will come only if a comprehensive approach is adopted. The tax system has to be affordable, fair, simple, and transparent. The government also has to be accountable for the money it is receiving. It is onlywhen these basic conditions are met that tax compliance will increase. Because a strong social contract between the State and its citizens is not yet sufficiently in place in Tanzania, a number of suggestions are proposed in the update, with the objective of stimulating debate on possibleapproaches to increase tax revenue.Publication Angola DTIS Update 2025 - Fostering Economic Diversification: Creating a Supportive Environment for Trade and Private Sector Growth in Angola(Washington, DC: World Bank, 2025-10-17)This Diagnostic Trade Integration Study (DTIS) update focuses on the trade-related constraints and opportunities impacting Angola’s capacity to diversify and increase regional and global trade.Publication Democratic Republic of Congo Economic Update, July 2025: Reassessing Tax Incentives - Falling Short of Promised Growth and Equity(Washington, DC: World Bank, 2025-07-01)The DRC Economic Update (DRCEU) evaluates the recent growth performance and macroeconomic policies in the Democratic Republic of Congo (DRC), providing a basis for policy dialogue with the Government and other stakeholders. The first section of the Economic Update assesses the drivers of growth and the macroeconomic framework, including three-year perspectives that highlight risks and challenges. The second section examines tax expenditures in greater detail, focusing on their recent evolution and the economic impact of tax incentives.Publication Mongolia Quarterly Economic Update, July 2010(Washington, DC, 2010-07)The improvement in public finances since last year, coupled with buoyant revenue due to the commodity price recovery, has led to growing pressures for increased government spending. Recently approved budget amendments envisage a 4.5 percent of gross domestic product (GDP) increase in spending on the originally approved 2010 budget, while the Mid-Term Budget Framework (MTBF) for 2011-2013 projects another 12.1 percent of GDP increase in spending in 2011. The main driver for the increases is the execution of promises made by both coalition parties to distribute monthly percentage rate, or MNT 1.5million (around US$1000) to each citizen in the form of cash and non-cash handouts and large public sector wage increases planned for October of this year. If these public spending plans materialize, they will set the stage for a renewed bout of high inflation and a possible return to the macroeconomic vulnerability characteristic of the boom-and-bust cycle of the recent past. In the real sector, the impact of increasing inflation is evidenced through a decline in real wages. The latest informal wage survey indicates that on average, workers' nominal wages have increased by about 10 percent from January 2010 to June 2010; this is because of an increase in job opportunities in the construction sector. Real wages, however, have declined on average due to the significant increase in the consumer price index.
Users also downloaded
Showing related downloaded files
Publication Guinea-Bissau Country Climate and Development Report(Washington, DC: World Bank, 2024-10-23)Guinea-Bissau is endowed with a wealth of natural resources, with the highest natural capital per capita in West Africa (US3,874 dollars per capita), which could be leveraged for sustainable and resilient growth. However, Guinea-Bissau faces significant development hurdles, such as high poverty rates, political instability, and economic challenges, including an over-reliance on cashew nuts. Rural poverty has increased, and the nation's infrastructure, education, and health care systems are underdeveloped. Climate change poses a severe threat, potentially impacting agriculture, fisheries, and infrastructure. Without adaptation, it could lead to a significant cut in real GDP per capita (minus 7.3 percent by 2050) and increase in poverty (with up to over 200,000 additional poor by 2050, that is, 5 percent of the expected population, in the worst scenario). The country's low greenhouse gas emissions are expected to rise, mainly due to agriculture and land-use changes, with deforestation being a major contributing factor. Although Guinea-Bissau is a low emitter, it has high mitigation ambitions, targeting a 30 percent reduction in greenhouse gas emissions by 2030. The Nationally Determined Contribution outlines significant climate actions, with initiatives focused on forest conservation, sustainable agriculture, and community development. However, the country's political instability, institutional weaknesses, and limited financial resources pose challenges to implementing these climate commitments, which depend heavily on external funding. The financial sector's underdevelopment and vulnerability to external shocks limit its ability to support green investments, though reforms could enhance resilience. Guinea-Bissau must consider its climate financing as development financing and vice-versa, engage the private sector, and integrate climate goals with national development plans to ensure a sustainable future. Concessional climate financing is vital due to the underdeveloped financial sector and the government’s limited borrowing capacity. Addressing Guinea-Bissau's vulnerability to climate change and its structural issues requires a cohesive approach that integrates development and climate strategies. This could involve improving governance, diversifying the economy, protecting natural capital, developing human capital, and investing in sustainable agriculture and infrastructure. The transition to a more sustainable and inclusive development pathway that supports economic growth is possible, but requires focusing on key strategic sectors, enhancing institutional capacity, and creating the conditions to mobilize finance. As a highly vulnerable country, there are myriad needs in the different sectors; however, to be more efficient and effective, Guinea-Bissau should prioritize actions in a few sectors, especially actions on biodiversity, agriculture, and social protection. Low carbon development, especially in energy and forestry sectors, could provide cost-efficient solutions and attract climate finance, including from the private sector, which will support the overall development agenda.Publication Jobs in a Changing Climate: Insights from World Bank Group Country Climate and Development Reports Covering 93 Economies(Washington, DC: World Bank, 2025-11-05)The World Bank Group’s Country Climate and Development Reports (CCDRs) provide a crosscutting look at how countries’ development prospects, and the job opportunities they offer to their people, can be threatened by climate impacts and supported by climate policies. Climate change and policies affect jobs through impacts on productivity, energy and material efficiency, and physical, human, and natural capital. They can also transform employment opportunities, especially through complementary measures that help workers and firms adapt to and benefit from new technologies and production practices. Prepared by the World Bank, the International Finance Corporation (IFC), and the Multilateral Investment Guarantee Agency (MIGA), CCDRs integrate country perspectives, climate science and economic modeling, private sector information, and policy analysis to assess how countries can successfully grow and develop their economies and create jobs despite increasing climate risks and while achieving their climate objectives and commitments. Each CCDR starts from the country’s development priorities, opportunities, and challenges, and is developed in close consultation with governments, businesses, and civil society, ensuring the recommendations reflect national priorities. By combining evidence on adaptation, resilience, and emissions pathways, CCDRs highlight where climate action can reinforce development and job creation, and where targeted policies are needed to manage risks and smooth labor market transitions. Taken together, these elements can help create local jobs, ensure economic transitions are just and inclusive, and equip workers and firms to navigate the disruptions and opportunities of a changing climate and changing technologies.Publication Kyrgyz Republic Country Climate and Development Report(Washington, DC: World Bank, 2025-11-03)This Country Climate and Development Report (CCDR) on the Kyrgyz Republic aims to support the country’s development goals amid a changing climate. The CCDR considers two policy scenarios up to 2050: the business-as-usual (BAU) and high-growth scenarios. As it quantifies the likely impacts of climate change on the Kyrgyz economy between now and 2050, the report highlights key government actions to best prepare for and adapt to climate impacts (referred to as “with adaptation” measures), with a particular focus on the time horizon up to 2030. The CCDR also outlines a path to net zero emissions by 2050 (referred to as “with mitigation” measures, “decarbonization,” or, simply, “net zero 2050”), highlighting associated development co-benefits.Publication Comoros Country Climate and Development Report(Washington, DC: World Bank, 2025-06-18)The Union of the Comoros (The Comoros) has significant vulnerability to climate change-related risks but has considerable opportunities to strengthen preparedness and resilience against these challenges. According to the Notre Dame Global Adaptation Index, the Comoros is the 29th-most vulnerable country to climate change and the 163rd most ready to adapt (out of 191). The Comoros archipelago is exposed to many natural hazards that adversely affect the country’s natural capital, people, and physical infrastructure. In 2014, the economic cost of climate-related disasters was estimated at 5.7 million dollars annually, equivalent to 9.2 percent of Gross Domestic Product (GDP). Between 2018 and 2023, as many as 11 tropical depressions or cyclones impacted the country, with Cyclone Kenneth causing the greatest damage, equivalent to 14 percent of GDP, resulting in total economic growth falling from 3.6 percent in 2018 to 1.9 percent in 2019. More than 345,000 people (40 percent of the population) were affected by the cyclone, with 185,000 people experiencing severe impacts and 12,000 people displaced. However, there is an opportunity for the country to grow more robust and shock-responsive, and to establish pre-positioned funding mechanisms to enhance future crisis response efforts. For the Comoros, adaptation and climate-resilient development are the key climate change focus areas, with the country projected to face 836 million dollars 2050 in additional costs due to climate-related impacts. Current plans to adapt to the impacts of climate change in the Comoros include efforts to improve water management, strengthen coastal protection, and develop climate-smart agriculture practices. Given the country’s reliance on its natural resource base for economic growth and mobility, protection of these resources from climate change will be essential for promoting resilient growth and development. In addition to growing the adaptive capacity of the country’s natural resource sectors, strategic economic diversification will be important to help minimize future climate impacts, and development activities will need to be undertaken in such a way as to attract low-carbon co-benefits. The Union of the Comoros is committed to addressing climate change through its Nationally Determined Contribution (NDC) and national priorities. The country’s NDC (which was revised in 2021 for a ten-year horizon) sets ambitious targets, with a goal of reducing greenhouse gas emissions by 23 percent by 2030. The country also plans to significantly increase the share of renewable energy in its energy portfolio, reaching 33 MW by 2030. This will not only promote low-carbon development but also reduce the country’s dependency on imported oil and coal, which currently make up 95 percent of the energy mix. Additionally, the Comoros has declared its intention to increase CO2 removals by 47 percent by 2030, compared to BAU.Publication Gabon Country Climate and Development Report(Washington, DC: World Bank, 2025-11-01)Gabon has a unique opportunity to drive inclusive growth, reduce poverty, and build a resilient post-oil economy, with climate action accelerating progress toward these goals. The country’s main development challenge is achieving higher growth and poverty reduction, as stronger growth is needed regardless of projected climate shocks to create jobs, raise living standards, and enable a viable post-oil economy. While pursuing growth-promoting economic reforms, climate action that prioritizes people must remain central to its development pathway. However, climate change risks exacerbating poverty and regional inequalities in a country already facing long-term challenges in expanding economic opportunities and basic public services, especially in rural areas. Climate shifts compound these challenges, making stronger private sector-led growth driven by reforms essential for resilience, diversification, job creation, and poverty reduction, though targeted investments in adaptation will still be required to mitigate climate shocks. Using a whole-of-economy approach, the Gabon Country Climate Development Report (CCDR) estimates that climate change impacts could result in GDP losses of 3.5 to 5.3 percent per year through 2050 compared to a business-as-usual baseline trajectory.