(Updates with comment from Moody’s in second paragraph.)
June 3 (Bloomberg) -- Angola’s sovereign debt rating was raised to ‘Ba3’ by Moody’s Investor Service as surging oil prices boosted the country’s fiscal and external accounts, the ratings company said.
The southern African country’s assessment is three notches below the company’s lowest investment-grade rating, and on par with Egypt. The outlook on the rating is stable, Moody’s said in an e-mailed statement today, implying it probably won’t change soon.
Higher oil prices boosted state revenues, helping the country swing from a fiscal deficit in 2009 to a surplus last year, while gross domestic product growth is forecast at a “robust” 7.6 percent for 2011, Moody’s said. Angola’s dependence on oil revenues and high inflation rate remains a constraint to the economy, the ratings agency said.
“Moody’s expects the balance sheet of the Angolan government to improve substantially to the extent that the country could become a net creditor within the next 12 months,” it said. “This positive development should not mask the challenges Angola is facing, such as high structural inflation, the uncompetitive non-oil economy, weak governance and limited human capital.”
Angola, sub-Saharan Africa’s second-largest oil producer after Nigeria, has a $1.4 billion loan facility with the IMF. The southern African nation intends to sell its debut dollar bond of $500 million in September, Finance Minister Carlos Alberto Lopes said on April 20.
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