20
MANAGEMENT REPORT
of the economy as a result of the decrease in unit la-
bour costs and signs of recovery in some of the coun-
try’s main trading partners.
A series of factors, including the fragility of the job market
(with unemployment at around 26%), the persistently ti-
ght lending conditions and the need to continue to reduce
the budget deficit, limit the growth of domestic demand
and impose a moderate pace of economic expansion.
Success in correcting the external imbalance of the Spa-
nish national accounts will depend on boosting expor-
ts and substituting a large proportion of imports with
goods and services produced domestically.
The programme of financial assistance to banks, which
allowed the recapitalization of financial institutions, en-
ded in January 2014.
In 2014 the public sector will need to maintain the fis-
cal consolidation effort in order to reduce the deficit to
5.8% of GDP (6.3% in 2013).
Situation in Angola
2013 was marked by a slight decline in the rate of expan-
sion of economic activity in Angola, which grew 4.5%,
mainly due to the slowdown in oil production and the
partial execution of the expenditures anticipated in the
national budget (OGE), specifically the expenditures en-
visaged under the Public Investment Programme (PIP).
According to Finance Ministry data, revenue from oil ex-
ploration decreased significantly in the last few months
of 2013. The drop in revenue is due to the fall in the ave-
rage price per barrel exported (down from USD 107.5
in 2013 to USD 111.0 in 2012), as the volume of exports
was almost unchanged (630 million barrels, +0.2% more
than the previous year).
A new customs tariff was published, effective from 2014,
with the ultimate objective of stimulating local produc-
tion through an increase in duties on imported goods.
Given the existing constraints on the local supply, this
change of policy may lead, in the short term, to an in-
crease in final prices for consumers, which will tend to
create inflationary pressures.
After of a period of very rapid growth associated with the
reconstruction effort, the Angolan economy entered a
period of more moderate, though still significant, growth.
The stable revenue from the expansion of oil and natural
gas exploration will allow the authorities to pursue their
strategy to stimulate economic diversification.
Final NOTE
Though less pronounced than before, some of the risk factors that could derail the recovery of global growth are
still present in 2014, in particular the numerous political conflicts with no solution in sight, which will continue to
affect the normal functioning of world trade and the performance of the emerging economies, which have been
affected by the shift in U.S. policy.
Even so, the outlook for the economy is more positive.
