Angola’s oil-backed debt to China is expected to decline to between $7.5 billion and $8.0 billion by year-end, according to the head of the country’s debt management office.
- Angola’s oil-backed debt to China is projected to decrease to between $7.5 billion and $8.0 billion by year-end.
- The country has halted new oil-backed loans from China since 2017, focusing on reducing dependency.
- Amid global uncertainties, Angola has paused plans for international debt issuance, including Eurobonds.
Angola’s oil-backed debt to China is expected to decline to between $7.5 billion and $8.0 billion by year-end, according to the head of the country’s debt management office.
“All debt collateralised by oil revenues is concentrated in agreements with China, which have been gradually reduced in recent years,” said Dorivaldo Teixeira, Director of the Debt Management Unit at the Finance Ministry.
Angola is pressing ahead with efforts to reduce its dependence on resource-backed loans, as it navigates a challenging global economic landscape shaped by fluctuating commodity prices, elevated interest rates, and shifting investor confidence, Reuters reported.
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Oil-backed debt to China, which totalled $10.15 billion at the end of 2024, had already declined to $8.94 billion by the end of last month, according to official data. The government expects this figure to fall further to between $7.5 billion and $8.0 billion by year-end.
Shift towards reduced risk
Angola stopped taking on new oil-backed loans from China in 2017, said Dorivaldo Teixeira, Director of the Debt Management Unit at the Finance Ministry. “The government has adopted a more cautious and transparent approach to contracting external financing,” he said.
Teixeira noted that Angola has paused its plans to issue debt on international capital markets for the time being, citing continued global uncertainty.
In April, the country was forced to make a $200 million margin call payment to JPMorgan for a collateralised bond, after a sudden drop in oil prices, triggered by U.S. tariff tensions, rattled frontier markets and pushed yields higher.
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Business Insider Africa previously reported that Angola has shelved plans to issue Eurobonds this year, citing heightened global uncertainties and declining oil prices that have weakened investor appetite.
To plug its funding gap, the government turned to the domestic market in the first half of the year, raising 2.2 trillion kwanzas (approximately $2.4 billion) through fixed-rate bond issuances.
The shift is part of a broader strategy to reduce refinancing risks and strengthen financial resilience amid external headwinds.
