Angola’s economic growth is forecast to remain modest over the medium term, averaging 2.7% between 2026 and 2028, driven primarily by non-oil sectors — yet with per capita income continuing to decline, approximately four in ten Angolans are expected to remain in poverty through 2027, the World Bank warned in its Angola Economic Report released in Luanda on Wednesday.
The report, titled ‘From Transit to Transformation: The Lobito Corridor as an Engine of Economic Diversification and Regional Integration’, cautions that growth recorded in recent years “has not been sufficient to reverse 15 years of declining per capita income.” The Lobito Corridor — the railway link connecting the Democratic Republic of Congo and Zambia to the Angolan coast at the port of Lobito — is described as fundamental to securing economic diversification beyond oil, the country’s dominant export.
“The development of the Lobito Corridor offers a unique and transformative opportunity to accelerate Angola’s economic diversification through improved connectivity, lower logistics costs and attracting investment outside the extractive sector and urban centres,” the report states, adding that “realising this potential depends more on institutional reforms than on infrastructure investment alone.”
The World Bank’s report, presented by the world’s largest multilateral financial institution, underscores that “non-oil sectors, supported by ongoing structural reforms — particularly agriculture — are expected to lead economic growth as oil production continues to decline.” Public debt is projected to fall to 49.1% of GDP by 2027.
“Falling incomes, rising prices and a heavy dependence on an increasingly depleted resource make it urgent for Angola to diversify its economy,” the institution said. “Angola’s deep reliance on oil creates a cycle of economic instability that has constrained the development of non-oil sectors. As a result, the country has been unable to generate broad-based productivity gains or sufficient fiscal revenues to invest meaningfully in improving its people’s lives.”
The risk posed by these constrained resources, the Bank’s economists concluded, is “the perpetuation of current challenges” — including “low productivity, precarious employment and inadequate public services” — in a context where, over the past decade, the share of young people out of school has risen from 25% to nearly 37%, and four in ten children under five suffer from chronic malnutrition.
Addressing Angola’s structural vulnerabilities — among them oil dependence, declining labour productivity, low human capital and institutional weaknesses — “is essential to achieving inclusive and resilient growth,” the World Bank economists said. Priority reforms, they noted, include continuing to rationalise fuel subsidies while providing adequate protection for low-income households, strengthening domestic revenue mobilisation, and investing in education, health and connectivity infrastructure.
The report concludes that “improving the business environment to stimulate private sector development and job creation, while managing global oil price risks, will determine whether Angola is able to make a successful transition to a diversified, competitive and inclusive economy.”
Source: Notícias ao Minuto
