Angola is planning to raise approximately $1.7 billion in international capital markets by 2026, as highlighted in the government's latest annual debt plan released on Tuesday. This move comes amidst rising debt-service costs and sluggish economic growth, prompting the government to seek out new financing avenues.

The debt plan outlines a strategy to secure around $1.4 billion through commercial financing. This financing is expected to include debt-for-health swap operations, in addition to $500 million anticipated from World Bank Development Policy Operations. These efforts aim to stabilize the country's public finances while ensuring essential government expenditures are maintained.

As the second-largest oil producer in sub-Saharan Africa, Angola is currently facing significant fiscal challenges, with debt servicing projected to consume over 40 percent of the government's total expenditure this year. Such financial pressures severely limit the government's capacity to engage in social and developmental spending.

The International Monetary Fund has projected Angola's economic growth to be stagnant at around 2 percent for the year. Any gradual recovery in the medium term relies heavily on the government's success in diversifying an economy that has traditionally depended on oil exports.

In response to these significant economic hurdles, the Angolan government has ramped up its initiatives to reduce fuel and other subsidies. Furthermore, it has embraced reforms aimed at opening its state-dominated economy to increased private investment.

The overarching goal of these reforms is to enhance revenue generation, reduce economic vulnerabilities, and restore investor confidence. Through these efforts, Angola aims to navigate its current financial pathway while addressing the growing pressures associated with its debt.