Page last updated at 20:23 GMT, Tuesday, 29 September 2009 21:23 UK

Angola secures IMF loan agreement

Angolan oil rig
Angola has been hit hard by the fall in oil prices

Angola has reached a preliminary deal with the International Monetary Fund (IMF) for loans of up to $890m (£558m).

IMF mission chief Lamin Leigh said the loans would help alleviate the nation's immediate cash flow pressures.

Angola, the world's 19th largest oil producer, has been hit hard by falling crude prices over the past year and the wider global economic slowdown.

Oil is currently trading at $67 a barrel, less than half its $147 all-time high of July 2008.

'Important victory'

Angola's Economy Minister Manuel Nunes Junior said the deal with the IMF would bolster the country's credibility.

Mr Leigh said the loans should be approved by the IMF board in November and that Angola was on track to pass an "appropriately tight 2010 budget, backed by firm policies on monetary management".

The preliminary deal marks a big improvement in Angola's relationship with the IMF.

Angola broke off talks with the IMF in 2007 and instead turned to China for billions of dollars in oil-backed loans.

"This is a very important moment for the government of Angola and we are on the way to securing one more important victory for the country and for the Angolan people," Mr Nunes Junior added.

Angola expects its economy to grow 6.2% this year, although analysts have predicted it could be as low as 0.4%.

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