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The IMF’s New $1 Billion Loan Package for Angola Shows Just How Little We Know About What’s Going on Behind the Scenes

Tweet by Joseph Cotterill, Southern Africa correspondent for the Financial Times.

The International Monetary Fund’s Executive Board said on Wednesday that it will immediate disburse $1 billion to Angola to help ease the country’s worsening financial crisis. What’s surprising about the announcement is that until now, the IMF had indicated that it wanted to wait until Angola has re-structured its vast debt portfolio with China before committing additional funds.

Well, that may have happened.

“The authorities have secured debt reprofiling agreements from several large creditors to reduce risks related to debt sustainability,” said the IMF in a statement yesterday. However, the IMF didn’t specify who those “several large creditors” were that have apparently eased Luanda’s current debt burden and paved the way for the new multilateral financing package.

Angola currently owes China around $20 billion and the IMF was concerned that if those Chinese loans weren’t restructured first, new IMF funding would be used to repay the Chinese.

Even though there’s been no official announcement or even any leaked details, it’s now reasonable to assume that Chinese and Angolan officials have agreed to some measure of debt relief sufficient to satisfy the IMF. But that’s still just an assumption – we really don’t know for sure.

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