The Angolan Minister of Finance, Archer Mangueira, today highlighted the importance of the World Bank’s approval of financing for the project to strengthen the social protection system in Angola, at a time when reforms of the price subsidy system are taking place.
The Angolan minister was speaking after the approval by the World Bank of a new financial package for Angola totaling US$1.32 billion, with US$320 million for the project to strengthen the Social Protection System, US$500 million for operation of Budget Support and 500 million dollars for the Bita water project, in Luanda.
With the approval of this new package worth US$1.32 billion, the BM increases its financing portfolio in Angola to US$2.52 billion.
The Angolan Finance Minister highlighted that the project to strengthen the social protection system is part of the income transfer policy, designed by the Executive to protect families with lower income.
“Strengthening the social protection system is particularly important at a time when the price subsidy system is being reformed. A model that was in force, price subsidies, became unfair and unsustainable in the face of the fall in oil tax revenues and the increase in the volatility of public debt”, said the minister.
Archer Mangueira clarified that the need to adjust the prices of administratively controlled goods, such as water, electricity, public transport and fuel, was included in the Macroeconomic Stabilization Program, approved in 2018, in order to reinforce the commitment to the ongoing reforms, which are being implemented by the Executive, as well as the transition to a new growth model.
In this way, the project to finance the social protection system, which will be implemented with technical support from the BM, aims to carry out monetary transfers to vulnerable families in target areas, with the target of around one million families.
The approval of project financing, according to the government official, will allow the conversion of generalized indirect subsidies into targeted direct subsidies, through direct income transfers to the most vulnerable families, as well as strengthening the management mechanism for a protective financing system sustainable social.
Regarding the Budget Support operation, whose financing of 500 million was approved by the BM, the minister said that given the drop in tax revenues, resulting from the drop in the price of oil with a very negative impact on the State’s treasury, the Executive turned to partners multilateral agencies, to support the country in this transition.
It was in this context that the Ministry of Finance asked the World Bank to structure a budget support operation worth 500 million dollars, also aiming to support ongoing economic reforms.
As for the third approved financing package, it is intended for the Bita water project, to provide drinking water to the population in the south of Luanda, specifically Camama, Benfica I and II, Cabolombo and Rocha Pinto.
He emphasized that WB financing for this type of water treatment and distribution infrastructure will substantially contribute to improving the quality of life of the families covered.
In conclusion, the minister highlighted that the Angolan Government is committed to rigorous and transparent management of the resources made available by the World Bank and counts on the technical support of this institution, for the successful implementation of the projects now financed.
Source: Angop