Angola will decide by November whether to extend its $1 billion total return swap deal with JPMorgan or seek financing through international capital markets, a senior debt official told Reuters.
The government entered the one-year derivative contract with JPMorgan in December, backed by $1.9 billion in government dollar bonds. The deal, which grabbed headlines earlier this year, is set to expire at the end of 2025.
“We have some options,” said Dorivaldo Teixeira, General Director of the Public Debt Management Unit at Angola’s finance ministry, speaking to Reuters on the sidelines of investor meetings in London. “It depends on the cost.” He explained Angola could raise debt, make a partial repayment, or simply extend the existing arrangement.
Teixeira noted that borrowing conditions for smaller and riskier issuers are gradually improving, with yields “going in the right direction.” Still, he emphasized that the JPMorgan facility has been cheaper than Angola’s Eurobonds. “If I can extend it, probably I will use it,” he said.
The facility currently costs Angola around 9%, compared with roughly 10% on the country’s international bonds, according to JPMorgan EMBI data. Teixeira added that Angola will seek more favorable terms in any renewed agreement. “We will push for a better deal than the current 9%,” he said, whether that comes from the bank or the markets.
In April, the swap deal was thrust into the spotlight when Angola had to pay JPMorgan $200 million in additional security after U.S. tariff tensions triggered a slump in oil prices and, in turn, a sharp decline in the value of Angola’s bonds.
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Angola also faces a significant repayment in November, with just over $860 million due on a dollar-denominated bond it issued in 2015.
Looking ahead, Teixeira said the finance ministry is working to improve debt transparency, with quarterly bulletins already in place and plans to shift to monthly publications by next year.
The government also aims to make debt data available in English as well as Portuguese. “The perception of risk of Angola was heightened a little bit because we didn’t communicate as much. People need more information about what’s going on,” he told Reuters, noting that better transparency could help reduce borrowing costs.
On oil, Angola is preparing for a more cautious approach in its 2026 budget. The government had to stress-test the 2025 spending plan after oil prices fell below its $70 per barrel assumption. Brent crude currently trades at $67, raising the possibility of a higher-than-expected deficit.
“One of the lessons that we learned from this, from this process, is probably next year, we should take a little bit more conservative approach that will help us to execute the budget in the most seamless way,” Teixeira said. He did not provide a specific price forecast but confirmed officials rely on top analyst projections.
A Reuters poll shows most analysts expect Brent to fall further, with prices averaging $62.98 per barrel in the second quarter of 2026.
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Image Credit: Mark-Anthony Johnson
