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IMF says Angola halts financial aid talks

WASHINGTON: The International Monetary Fund said Thursday that Angola has suspended talks for financial aid that had rea

June 30, 2016

imageWASHINGTON: The International Monetary Fund said Thursday that Angola has suspended talks for financial aid that had reached an advanced stage as the country grapples with a collapse in oil prices.

In-mid June, an IMF team concluded a mission in Angola and reached a preliminary agreement on $4.5 billion in loans.

Angola, the second-largest oil producer in Africa, had asked for IMF help in April. Oil prices were lower then than they are now as global oversupply fears eased.

The loan, called an extended fund facility, was awaiting approval by the IMF executive board.

"There's a change," IMF spokesman Gerry Rice said at a regularly scheduled news conference.

Rice said that the Angolan authorities had "recently" informed the IMF of the government's desire "to continue policy dialogue with the Fund only within the context of the Article IV consultation," the annual economic review by the institution, but not involving new loans.

"The discussions concerning a possible EFF will no longer feature in the IMF staff engagement with the authorities," he said.

The IMF gave no explanation for the about-face in Angola's aid request, which could be linked to the recent rebound in oil prices. Still, oil prices remain about 50 percent below their mid-2014 peaks.

Angola's economy grew rapidly after the end of the 27-year war as oil production fueled a boom in the capital Luanda. The country has depended on oil production for 95 percent of its export earnings and more than half of government receipts.

Angola had IMF financial assistance of $1.4 billion between 2009 and 2012.

Copyright AFP (Agence France-Presse), 2016