Angola reviews oil sector as prices tumble

Angola’s president has appointed a government team to help reorganise the oil sector and state firm Sonangol as Africa’s second-largest crude exporter suffers from the price drop.

The group will include the ministers of state, of petroleum and of finance, the governor of the central bank and officials of state oil producer Sonangol, President Jose Eduardo dos Santos said in a statement seen by Reuters on Tuesday.

Oil output represents 40 percent of Angola’s gross domestic product and over 95 percent of export revenue but declining oil prices have sapped dollar inflows, dented the local kwanza currency, hammered public finances and prompted heavy government borrowing.

The team is expected to develop plans to improve Sonangol and other aspects of the oil and gas sector, but the statement did not offer details.

Although Sub-Saharan Africa’s third largest economy is not tipping into recession, its growth will slow, Vice President Manuel Vicente told parliament on Oct. 15 in the State of the Nation address.

The International Monetary Fund said in August Angola’s economic growth is likely to slow to an average of 3.5 percent a year between 2015 and 2016 from about 4 percent last year as weaker oil prices bite. (Writing by James Macharia, editing by William Hardy)