(Bloomberg) -- Angola will hold off tapping international bond markets for a second time this year, choosing to finance its budget with windfall oil revenues instead.
Sub-Saharan Africa's second-biggest oil producer had planned to raise $2.8 billion in the Eurobond market this fiscal year, and successfully placed $1.75 billion this month. It will continue to monitor the market, according to a finance ministry official who asked not be named since they're not authorized to speak to the media.
The move comes amid turmoil in global bond markets sparked by surging inflation and en ever-more-hawkish Federal Reserve, which have pushed up borrowing costs for sovereign and corporate issuers. The rise in crude-oil prices means Angola doesn't need more borrowing, the official said.
The government's debt plan to sell $2.8 billion in Eurobonds was approved based on an assumed oil price of $59. Brent crude has since climbed to about $106 in the wake of Russia's invasion of Ukraine.
Angola sold $1.75 billion in Eurobonds debt on April 7, attracting bids for twice the amount. It was the second African nation after Nigeria to tap the market since the start of the war in Ukraine, and South Africa followed soon after.
Angola sold debt “in that amount and that was it,” a spokesman for the Ministry of Finance spokesman said in a text message. “Even if there is market appetite for more.”
South Africa, Africa's most industrialized nation, paid its highest coupon in two decades when it sold $3 billion of Eurobonds this week.
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