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Last Updated: Tuesday, 13 March 2007, 22:40 GMT
Angola calls a halt to IMF talks
By Lara Pawson
BBC News, Luanda

Oil platform off the coast of Angola
Angola is sub-Saharan Africa's second-biggest oil producer
Angola has cancelled all negotiations with the International Monetary Fund, on the grounds that it is quite able to maintain economic stability on its own.

Finance Minister Jose Pedro de Morais said the economy had grown in real terms by 13% in the past three years.

He said the government had successfully implemented its own macro-economic stabilisation programme while relying exclusively on its own resources.

This month, oil production is expected to reach 1.6m barrels a day.

During the past few years, the Angolan economy has gone through massive growth and inflation has been brought under control.

It is widely believed that because of the vast oil resources here, the government does not need the IMF.

Nevertheless, some observers will be concerned that this latest development involving the IMF will help neither transparency nor the very poor population.

Dialogue

The finance minister has told the IMF that this wave of prosperity has opened up opportunities with what he called "new partners" and on this basis, consultations with the fund have been cancelled.

This year alone, Angola expects to produce 585m barrels of oil, worth over $30bn (23bn euros) - more than the entire Organisation for Economic Co-operation and Development aid to the whole of Africa in 2006.

Calvin McDonald, advisor in the Africa Department of the IMF and mission chief for Angola, told the BBC that Angola had been offered the possibility of having an IMF-supported programme, which would probably not have involved borrowing.

"The Angolans subsequently informed us that they didn't think they need this programme," he said from Washington DC.

"So there was nothing to break off, there was no programme that was abandoned or cancelled - they simply decided they didn't want the programme."

He said the IMF expected to continue a dialogue with Angola, through which it would give advice to the government.

Misgivings

The announcement to limit co-operation with the fund will come as no surprise to Angola-watchers.

The IMF has, for several years, harboured misgivings about how the country accounts for its oil revenues.

Nevertheless, it remains unclear whether the decision not to pursue an IMF agreement will affect Angola's estimated debt of $2.3bn to Paris Club creditors.

According to Mr McDonald, Angola does not need an IMF-monitored programme to negotiate with the Paris Club.

"The Paris Club makes its own decisions about what it requires in order to deal with countries," he said.

"So it is up to the Paris Club and the Angolans to decide what is the requirement for them to enter into negotiations. And the Angolans took all of that into account when they decided whether or not to proceed [with the IMF]."


SEE ALSO
Angola eyes $50bn oil investments
08 Mar 07 |  Business
Angola set to join Opec oil group
30 Nov 06 |  Business
Oil helps Angola but poverty rife
30 Mar 06 |  Business
Country profile: Angola
26 Oct 06 |  Country profiles
Timeline: Angola
26 Oct 06 |  Country profiles

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