Angola: Revised budget ensures more fiscal space to investment expenditure

Angola Finance Minister Armando Manuel Angola Finance Minister Armando Manuel

Angolan government has decided to review the State Budget for 2016) due to adjustment of global oil prices and correction of non-oil revenue, said Friday the Finance Minister Armando Manuel.

Armando Manuel was clarifying on the issue raised by the MPs on the relevance of revising the State Budget in the last months of the year.

The minister said this period is the right time to review the State Budget as the process is a sign of responsibility in conducting the economic policies which entails planning, assessing, identifying the main factors for correction.

He went on saying that the non-oil revenue was expected to grow at 6%, something like 124.0 billion kwanzas, following the evaluation of the first half performance.

In January, he noted, the country failed to achieve this component that would enable to offset the less oil revenue over the non-oil revenues, “said the minister, while answering the issue raised by the leader of the Parliamentary group of opposition UNITA.

The minister added that another reason that led the Executive to review the State Budget is to provide more fiscal space to investment spending to help change the future structural state of the economy.

According to him, the government is increasing this expenditure by 17.8 percent.

Much of this spending comprises projects that are being financed with credit line as it is the public investment that boost the economy to ensure more public investment to generate more jobs in very short term.

Armando Manuel stated that the revised budget may enable the sectors of the economy, whose projects stand idle, to re-launch their activity.

On the other hand, he said, the government is changing the traditional paradigm that existed in credit lines, in which, all resources were allocated only to the external entities.

This method, the official noted, opens the opportunity of sub-contract of Angolan small and medium-sized local businesses.

The minister also said that revised budget is not only restricted to the aspects related to the performance of August to December economy but also incorporating the adjustment ranging from January to date.

This will enable the indicators match the goal presented in foundation document by the yearend, he said.

Armando Manuel said that in the first quarter of this year, the average oil price was USD 32.15. But despite this situation the Government did not make any decision to revise the State Budget.

However, he said, the government took precautionary measure when it released the Presidential Decree No 21/16 of 15 January.

The measure entailed freezing part of the current expenditure and the capital spending, which do not have funding source guarantee.

According to the minister, this was a precautionary measure in a scenario in which the revenue would not flow at the expected level.

In conclusion, the minister described the move as an action of fiscal responsibility.

Thursday the MPs met with incumbents of the social sectors, with stress to education, health , sports, culture, former combatants, science and technology, higher education, media, social welfare, family and women promotion, environment, justice and human rights.

Based on global oil price of USD 40.9, the Bill was approved in generality on 15 August with 165 votes in favor, 33 against and two abstentions.

The revised general budget is estimated at 3.4 billion Kwanzas.

Source: AllAfrica