Luanda, July 8, 2024 (Lusa) - Standard Bank Angola has warned that the country risks losing the opportunity to turn the demographic dividend into a pillar of sustainability due to the poor quality of education and inability to generate employment, it was announced today.
Standard Bank, in a summary note of the II Economic Briefing 2024 made public today, also warned of a "high risk" that the growth of the Angolan economy will remain below the target of 3%, as set out in the National Development Plan (PDN) 2023-2024, "due to exchange rate and fiscal pressures and moderate investment".
According to its chief economist, Fáusio Mussá, who was a speaker at Friday's meeting, although Angola has 35 million inhabitants and an economically active population of 17.4 million, formal employment is very low and unemployment stands at 32% of the active population.
With "poor quality education and little capacity to generate employment", the economist noted, the demographic dividend "is wasted".
Fáusio Mussá also pointed out that "despite the increase in the minimum wage in June, to the tune of 119%, high inflation and high unemployment continue to have a negative impact on the cost of living and the economy in general".
The expert also commented on the growth of Angola's Gross Domestic Product (GDP) in the first quarter of 2024 of 4.6% year-on-year, a nine-year high, noting that this reflected, on the one hand, positive base effects from the oil sector, which grew by 6.9%, although on the other hand there was "surprising growth in non-oil GDP of 3.9% year-on-year".
"We maintain our forecast of GDP growth of 2.3% in 2024, made in the June edition of African Markets Revealed," he said, also emphasising the "strong dependence on the oil sector, which represents around 95% of exports, more than 50% of tax revenues and around 1/3 of GDP."
Fáusio Mussá also said that the Angolan government's economic growth assumptions for 2024 "seem optimistic, since the non-oil economy requires adequate levels of foreign currency in order to function".
As for monetary policy, Standard Bank's chief economist in Angola, Mozambique and the Democratic Republic of Congo said that it should continue to be more restrictive, "given that the high growth of the money supply in local currency and loans and credit to the state do not help to combat inflation or support the kwanza (Angolan currency)".
DYAS/ADB // ADB.
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