The Angolan government’s efforts to achieve macroeconomic stability to bring inflation and fiscal deficit considerably down are paying off despite high vulnerability to oil revenue shocks. The expected overall growth of up to 7 percent will be contributed to by increased oil production, multiple public investment programs, tax administration reforms, and inflation control. Concentrating on a medium-term fiscal framework, structural transformation and diversification are expected to reinforce the economy. The Executive Board, which welcomed the Stand-By-Arrangement and Financial Sector Assessment Program (FSAP), suggested removing exchange restrictions.
Mr. Hamid R Tabarraei, Hamed Ghiaie, and Asghar Shahmoradi
The structural model in this paper proposes a micro-founded framework that incorporates an
active banking sector with an oil-producing sector. The primary goal of adding a banking
sector is to examine the role of an interbank market on shocks, introduce a national
development fund and study its link to the banking sector and the government. The
government and the national development fund directly play key roles in the propagation of
the oil shock. In contrast, the banking sector and the labor market, through perfect
substitution between the oil and non-oil sectors, have major indirect impacts in spreading
This 2005 Article IV Consultation highlights that economic performance in Ghana has improved since 2000, with the economy growing at its fastest pace in more than a decade. In 2004, real GDP growth reached 5.8 percent, driven by agriculture and a strong pickup in the services and construction sectors—helped by increased bank credit and private inward remittances. Ghana’s medium-term prospects appear promising, with growth projected to continue at the current relatively high rate, provided that macroeconomic stability becomes further entrenched with fiscal sustainability, inflation declines further, and the government perseveres with structural reform.