PSIA - Republic of Angola PSIA- Subsidy Reform and Extension of Social Protection Program.pdf

    As the second largest African oil producer, Angola had unsustainable government expenditures in effect until 2014 due to the drop in international oil prices. The Government responded with a comprehensive reform program including the gradual elimination of most fuel subsidies and an extension of the social protection program Cartão Kikuia. This report analyzes the impact of those reforms on poverty using micro-level simulations based on the most recent household consumption survey IBEP (2008). First, household data is projected to 2015 incorporating changes in population numbers as reported by the Population Census 2014. Second, the impact of the subsidy reforms is estimated by applying the price changes due to the reform to household budgets. Third, the extension of the Cartão Kikuia program is simulated as a cash transfer by adjusting budgets of targeted households with the non-cash benefit from Cartão Kikuia.