Angola Bets on 5.5% Growth in 2027 Budget as Non-Oil Economy Offsets Falling Crude OutputAngola Bets on 5.5% Growth in 2027 Budget as Non-Oil Economy Offsets Falling Crude Output
Key Highlights
- Angola's draft 2027 budget targets growth of about 5.5% even as oil output slips and the oil sector shrinks.
- The plan assumes crude at KSh 9,209 ($71) a barrel, well below recent market levels, and a deficit of 3.8% of GDP.
- Non-oil activity is expected to carry the expansion while inflation eases but remains in high single digits.
Angola's draft 2027 budget projects economic growth of about 5.5%, matching this year, while assuming oil will average KSh 9,209 ($71) a barrel and the oil sector itself will shrink.
The assumptions matter for readers in Kenya, an oil importer. Angola, Sub-Saharan Africa's second-biggest crude producer, is budgeting for a price far below recent market levels, a cautious stance that shows how producers are planning for a softer oil market even as importers feel the pain of dearer fuel.
Non-oil economy to carry the growth
According to the draft released on Friday by the Angolan Ministry of Finance and reported by Reuters, the non-oil sector is expected to grow 7.19% in 2027 and drive most of the expansion, while the oil sector is expected to contract 3.82%. Oil production is forecast at about 1.00 million barrels a day, down from 1.05 million in 2026. The 2026 growth forecast stands at 5.57% in the mid-year budget review.
Spending, deficit and inflation
Planned spending is 37.3 trillion kwanza (KSh 5.3T, $40.9B), with a deficit of 3.8% of GDP. Debt service is projected at 43%, though the report does not state what that share is measured against. Inflation is expected to end 2027 at 7.27% year on year, easing from 8.43% in September 2026. The budget uses an exchange rate of 913 kwanza to the dollar.
The draft will go to parliament and could still change before it is approved.
A cautious oil price, a different pain for Kenya
Mwenendo earlier reported that oil near KSh 13,683 ($105.46) a barrel was one of several pressures on Kenya's currency cushion. Angola's budget price sits well under that level, which means the country would collect less than it could if prices stayed high, but it protects its plans if they fall.
The currency pressure facing oil importers is already visible in the region. As Mwenendo earlier reported, Uganda's central bank lifted its key rate to 12% to defend the shilling. Angola's bet on non-oil growth will be tested if oil output falls faster than expected, because crude still anchors the country's export earnings and government revenue.
In Summary
- What does the draft budget assume?
- Growth of about 5.5% in 2027 on oil at $71 a barrel, with a deficit of 3.8% of GDP.
- Who is driving growth?
- The non-oil sector, forecast to grow 7.19%, while oil contracts 3.82%.
- When was it released?
- Friday 30 October 2026, ahead of presentation to parliament.
- Where is the spending going?
- Planned spending is 37.3 trillion kwanza (KSh 5.3T, $40.9B).
- How is inflation expected to move?
- To end 2027 at 7.27%, easing from 8.43% in September 2026.