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Country Report Angola Product Image

Country Report Angola

  • ID: 2114010
  • December 2014
  • Region: Angola
  • 24 Pages
  • The Economist Intelligence Unit

On December 12th Sonangol signed a US$2bn loan deal with China Development Bank (CDB).

Although the CDB has extended credit worth several billion dollars to the Angolan government bilaterally, this is the first time that the Asian institution has given a loan directly to Angola's state oil company, Sonangol. At the signing ceremony in Beijing, Sonangol's chairman, Francisco de Lemos José Maria, said that the money would be allocated to various activities including oil exploration, refining, logistics and social housing projects. The loan period will be ten years, but no details were given about terms or interest rates.

Sonangol Empresa Publica (EP), which as the parent company of the Sonangol Group has more than a dozen subsidiaries, usually posts annual profits of at least US$2bn. There is speculation that given tumbling international oil prices and technical problems that served to depress domestic output earlier this year, the company could be in for some leaner results. The CDB loan may therefore be a way of plugging some liquidity gaps, or at least providing some cushioning to allow the continuation of capital projects. One such expenditure is the commissioning of two new oil tankers from the South Korean shipbuilders Daewoo Shipbuilding and Marine Engineering. The vessels, priced together at US$140m, are due for delivery in 2017.

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Country Report Angola

Sonangol obtains Chinese loan
Event
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