Angola's economy has been helped by its oil sector but much remains to be done to entice greater investment and beat widespread poverty, the IMF has said.
Despite soaring oil revenues poverty is widespread, the IMF says
The Fund's annual survey said that oil revenues have been the force behind economic growth in the country.
Government oil revenues increased to $10bn (£5.7bn) in 2005, up from $5.6bn the year before.
However, the IMF noted that the outlook for the economy was "subject to significant risks".
Unpredictability in both the oil production environment as well as the price of oil means "public expenditure growth needs to be set in a medium-term context to avoid the boom and bust cycles that have undermined stability and development in some other oil-producing countries," the report said.
Rising oil production pushed GDP up 18% last year, while oil output exceeded 1.4 billion barrels per day. Projections put oil production at more than 2 million barrels per day for 2007.
Angola is trying to rebuild its economy four years after the end of civil war that lasted for 27 years. Most people survive on less than $2 a day.
"The climate for doing business in Angola whether for residents or foreign companies is still considered one of the least conducive in the world," the report said.
The economy is highly concentrated in a few sectors. Apart from oil, construction, distribution and diamonds, other commercial activity is limited.
The IMF has previously requested that Angola improve transparency regarding its oil sector.
A report by Human Rights Watch in January 2004 said $4bn in oil revenues were unaccounted for in government finances from 1997 to 2002.