Angola: Investors praise economic reforms, liberalisation of forex market

The senior economist from Global Evolution in Luanda on Wednesday praised the economic reforms carried out by the Angolan government, especially the liberalisation of the foreign exchange market, but argued that it was also important to reduce the inflation rate.

Stephen Bailey-Smith is part of a delegation of potential non-resident investors that travelled to Angola at the invitation of South African Standard Bank, on a road show to understand the dynamics of the Angolan market.

In a meeting with the media, the senior economist from Global Evolution, an investment management company, which was founded in 2007 and specialises in emerging markets, said that the change in monetary policy, “is important, but it is even more important if you continue to maintain these reforms when the price of oil also drops.

“I think the liberalisation of the foreign exchange market is very important for the development of the economy and the reduction also of the inflation rate to single digits is equally important,” he noted.

The senior economist from Global Evolution noted that in the meetings held on Tuesday with the Angolan government leaders, particularly the governor of the central bank, “the message was a commitment to stabilise the foreign exchange market and inflation”.

“And the reforms that the government has made could help stabilise,” said the senior economist at Global Evolution, which manages a fund of around US$15 billion (€13.5 billion).

According to Stephen Bailey-Smith, Angola has a “more than significant” weighting for allocation in this fund.

“It is my return to Angola seven years later, the fund I represent already has some experience in dealing with the Angolan market, for over ten years and it is a rule to visit countries before making investments,” he noted.

According to the economist, Angola has undergone a transition process over the last few years, which puts the country in a better position than in the past and at the moment, it has had support from oil prices.

“And after the International Monetary Fund programme, I think the Angolan economy will need investors like us to be able to support this development and the funds, including mine, want to assist and help the government in this regard,” he indicated.

“We have invested in Eurobonds for many years and have had some interest in investing in local government bonds, we are very keen to now have the opportunity to transact in this local market,” he added.

Bailey-Smith believes that Angola “is going to be one of the biggest markets for securities, investments and bonds” in the near future, stressing that the fund is only interested in public debt instruments traded on the market.

Global Evolution is known for its innovative approach to investing in emerging markets and frontier markets and is currently one of the most recognised specialists and pioneers in this market segment.