Economic growth eases in the first quarter of 2026

GDP growth eases but remains above trend: Angola's GDP expanded 5.3% in annual terms in Q1, following a 5.7% expansion in the previous quarter, remaining well above the long-term trend. On a seasonally adjusted quarter-on-quarter basis, the economy grew 1.4% in Q1, following a 1.9% expansion in the prior quarter.

Non-oil activity weighs on economy: Non-oil GDP grew 6.7% in annual terms in Q1, following 7.5% growth in the prior quarter. Conversely, oil GDP was down 0.2% in annual terms in Q1, following a 1.2% contraction in the previous quarter. Relative to the previous period's data, readings in Q1 softened for the agricultural sector (+2.5% on a year-on-year basis vs +4.3% in Q4) and the services sector (+9.8% vs +10.1% in Q4). In contrast, the reading for the industrial sector improved in Q1 (+1.9% vs +1.8% in Q4). The oil sector's drag on growth continued to fade, as output near-stabilized after a prolonged period of decline. On the non-oil front, transport, digital services and manufacturing were the standout performers, underpinning growth. The increasingly broad base of non-oil growth reflects Angola's continued progress on diversifying away from hydrocarbons.

Energy shock shapes the path ahead: Growth is expected to slow sharply in Q2, with the pace seen more than halving from Q1, as the base effect from an exceptionally strong prior period fades and investment likely eases following the completion of several major projects in late 2025 and early 2026. Looking at 2026 as a whole, GDP growth is seen coming in close to 2025’s level, underpinned by higher crude prices and a forecast rise in domestic oil production boosting export revenues and supporting government spending, alongside resilient household consumption and continued non-oil momentum. The main downside risks are rising input costs for farmers and manufacturers from the global energy crisis and fiscal pressure if fuel subsidy reforms stall. A stronger-than-expected rise in oil output is the key upside risk.

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