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1. #Angola gov making reform progress but still much to do if debt risks to be contained. Some necessary reforms unpopular & risk of pushing too hard as economy recovery fragile. Need time to shift economy from oil & to jobs but time not on Angola’s side. Recent trip thread 1/10 
2. Key areas reform for investors to watch 1/ FX. 2/ Balancing budget & stabilising debt. 3/ Privatisation program. Each important to gov & for keeping $3.7bn IMF program on-track (crucial for eurobond investors & China’s exposure). S&P has #Angola on a B- rating with neg outlook
3. FX big hurdle to non-oil business. Depreciation since devaluation. More market-based allocation but hard to get letter of credit needed to access FX (most firms import inputs). Official & parallel rate gap had narrowed but recently widened. Now official AOA364/$, parallel=~535
4. Until easier FX allocation, will be drag on non-oil investment. Also parallel rate premium means those with official FX access could make easy money. Creates perverse incentives. Wheeling & dealing replaces entrepreneurship & job creation. FX reform important to IMF
5. FX risks also with large public external debt to service =~$51bn (inc $5bn eurobonds, China ~$23bn). Pressure visible in net FX reserves at BNA, down to ~$9bn vs mid-2019 target of $10bn. Gov also has $2bn cash recovered from sovereign wealth fund, plans to spend it for 2020
6. Balancing budget. Adjustment delayed 2014-17 when oil fell from $100. Gov & Sonangol borrowed lots. 2014 debt-GDP 40%, ~90% 2019. Large consol happened: spend ~40% GDP per year 2010-14, down to ~20% GDP 2018-19. Gov working to meet targets but still odd ideas like new gov HQ
7. Next steps: VAT intro 1st Oct (delayed July). Fuel subsidy reduction, pump prices not increased as AOA dep'd. Today diesel K160/43 US cents (at official rate) costing gov (most refined products imported). Both important to IMF agreement but unpopular & local elections in 2020
8. Privatisation plan listed 91 state company. Pressure to act quickly as huge drain on state finances. But better strategy needed. Should decide where state needed & not & rebrand it beyond privatisation: some reform, some closing, only few might be successful in private hands
9. In sum. Action needed to stop debt rising far above 90% GDP. IMF program essential to avoid debt crisis. Risk reform fatigue & reversal. No easy path for gov. Oil only served elite now pressure for inclusion. Need time to redirect economy but time not on Angola’s side
10. PS if visiting well worth taking a copy of the @BradtAngola guidebook. Recommends good places to explore. Lots to do in Luanda, particular fondness for central bank museum, sea front running, & grilled fresh fish on the beach
