(Bloomberg) -- The International Monetary Fund urged Angola to continue to gradually remove fuel subsidies even after a partial scrapping led to deadly protests last year. 

“It’s fundamental,” Victor Lledo, the IMF’s resident representative in Angola, said at a conference in Luanda. “They steal crucial fiscal space for other social and public expenses that are so important for the private sector. The big question is how.”

Five people died in protests last year after Angola reduced gasoline subsidies, almost doubling pump prices that had been among the cheapest in the world. The government has since delayed further cuts as persistently high inflation continues to increase living costs in one of Africa’s most unequal nations. 

Finance Minister Vera Daves de Sousa said last month that her government remains committed to phasing out fuel subsidies but is trying to achieve that goal without provoking a public backlash. The subsidies cost the state between $3 billion and $4 billion per year, Daves de Sousa said in an interview with Luanda-based Radio Lac in 2023. 

“The removal of these subsidies will have an impact on inflation,” said Lledo. “Our view is that this should be done gradually.”

The annual inflation rate in Angola climbed to a two-year high of 26.09% in March from 24.07% the previous month.

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