The ratings on the Republic of Angola are supported primarily by our view of the country's large hydrocarbon endowment, strong growth prospects, and low government and external debt levels. In addition, Angola's level of prosperity (measured as GDP per capita), significantly exceeds the median for 'B' rated peers and is closer to 'BB' rated sovereigns (although there is huge income disparity). Furthermore, gross external financing needs as a share of useable reserves and current account receipts are much lower than the 'B' median, which supports external liquidity. The ratings are constrained by what we view are weak institutions, a low level of development outside the oil sector, and political succession risk and related political tensions. In our view, Angola's rising
