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Price rises and below-average harvests drive Crisis (IPC Phase 3) outcomes

  • Key Message Update
  • Angola
  • May 2024
Price rises and below-average harvests drive Crisis (IPC Phase 3) outcomes

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  • Key Messages
  • Key Messages
    • Food insecurity for poor and very poor households is being driven by below-average harvests, reduced income due to limited casual agriculture labor opportunities, and higher-than-normal market prices. The below-normal agricultural season, compounded by preceding years of drought, is resulting in low availability of casual agricultural labor opportunities on farms to harvest cereals. State and independent media are also reporting hunger in southern and eastern areas with high poverty rates, and that received low rainfall. Additionally, below-average crop prospects in southern Huila and some parts of Huambo and Bié are expected to reduce labor opportunities for poor household members from Cunene and Namibe who normally migrate for labor opportunities. The poor harvest will likely negatively impact the volume of staple food supplies that flow to Namibe and Cunene from Huila this year. The low rainfall in Namibe and Cunene is also detrimental to livestock health, with local reports confirming poor livestock body conditions. The below-average harvests, lower-than-normal labor opportunities, and high food prices will keep household purchasing capacity low in the post-harvest period. Crisis (IPC Phase 3) outcomes are expected through September for at least one in five households in parts of Huila, Cuando Cubango, and Cunene as they continue relying on market purchases for their food needs. However, area-level Minimal (IPC Phase 1) and Stressed (IPC Phase 2) outcomes are expected through September across the rest of the country, where average rainfall supported agricultural production.
    • Pressures on food prices from macro-economic and commercial policies remain mixed. Food imports increased in the first trimester after declining in previous ones but are lower than the same period last year. In late May, the Ministry of Industry and Commerce approved the further importation of 270,000 tons of rice in three phases this year, with some commercial agribusinesses also harvesting 15,000 tons of rice in Malanje Province. On May 17, a Presidential Decree set new regulations on informal trade that may reportedly increase food prices and reduce labor opportunities through detailed rules for informal trading and bureaucratic requirements, such as requiring traders to annually obtain a seller’s card by submitting an ID and fee to municipal administrations that are often under-resourced. However, in late May, the government and unions negotiated a new minimum monthly wage of 70,000 AOA (81 USD), and 50,000 AOA (58 USD) for small businesses, to adjust wages for inflated prices. The new minimum monthly wage is around a 55 percent increase and is expected to improve some households’ purchasing capacity for food and non-food needs.
    • The annual inflation rate in Angola accelerated for the 13th straight month to 30 percent in May 2024, the highest inflation rate since June 2017. The latest inflation figure reflects the impact of removing the fuel subsidy and a weaker Angolan Kwanza (AOA). In particular, prices for transportation, healthcare, and miscellaneous goods and services registered notable rises. The National Bank of Angola has been limiting foreign exchange trading, and banks have reported difficulties in purchasing dollars outside of an increasingly narrow exchange rate margin since the beginning of the second half of 2023. This continuous rise in inflation will likely affect poor and very poor households’ purchasing capacity and ability to meet their minimum food and non-food needs.

    Recommended citation: FEWS NET. Angola Key Message Update May 2024: Price rises and below-average harvests drive Crisis (IPC Phase 3) outcomes, 2024.

    This Key Message Update provides a high-level analysis of current acute food insecurity conditions and any changes to FEWS NET's latest projection of acute food insecurity outcomes in the specified geography. Learn more here.

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