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New investors energisethe oil and gas sectorNew investors energisethe oil and gas sector

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Glittering opportunitiesfor mining companies

New investors energisethe oil and gas sector

ANGOLA

ANGOLA

ANGOLA

ANGOLA

ANGOLAFFIIEELLDDSS OOFFDDRREEAAMMSS

Glittering opportunitiesfor mining companies Glittering opportunitiesfor mining companies

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Angola cover 11/2/01 3:17 PM Page 1

contributed equally to the expansion ofAngola’s financial market,” he says.

The government anticipates that grossdomestic product (GDP) will grow from3.3 per cent to 11 per cent next year. Thisis based on a 16 per cent increase in oilexports as new fields come onstream.

However, Angola has been struggling toachieve goals set by the InternationalMonetary Fund (IMF) that would qualify

the country for a loan package and techni-cal help to get the economy back on track.

Inflation targets and other objectives,including increased privatisation of statecompanies and monitoring of oil sectoroperations, were not met by the IMF’sJune deadline.

At the beginning of October, the gov-ernment hiked retail petrol prices in amove towards the IMF goal of ending

state subsidies – reducing the amount ofsubsidy paid to state petroleum companySonangol from 48 per cent to 36 percent. But the governor of Angola’s cen-tral bank, Aguinaldo Jaime said recentlythat the deadline needed to be extendedinto the first half of 2002 for the IMFtargets to be met.

Meanwhile, the UN’s World FoodProgramme will invest $168 million inaid for the poorest Angolan citizens nextyear. Much of it will be for humanitarianassistance.

Despite Angola’s increasing oil revenues,the war has forced the governmentto spend vast sums on defence – 41 percent of its budget in 1999 – to keep thecountry’s Unita rebels at bay.

In this year’s budget more than a fifth of resources have been directed to national reconstruction and socialbenefits. A top priority is the resettle-ment of some 500,000 displaced people,most of whom have been living inwretched conditions in camps.

The cultivation of staple crops hasresumed in most regions, but the meansto market and deliver surplus to theareas of greatest need do not exist.

This is a huge problem that anguishesFernando Muteka, the minister for

2 World Report ANGOLA

Economy expandsas inflation fallsand currency becomes stable

CONTENTS

4 REFORMING FINANCERestructuring and privatisationaim to promote competitionand develop transparency

8 COAST TO COASTAngola’s 18 provinces areseeking to boost agricultureto obtain self-sufficiency

18 GLITTERING FUTUREThe diamond industry isenjoying greater stabilityafter decades of conflict

17 NOVEMBER 2001

Printed by Quebecor, NorthamptonshireReproduction by F. E. Burman, London

This supplement was produced for TheIndependent by World Report Limited Inc, who are solely responsible for the content.World Report Limited Inc. is not connected orassociated with any company registered in theUnited Kingdom bearing the same or similarname.

For more information contact: World Report Limited Inc, PO Box 2339, London, W1A 2NX. Fax: (020) 7495 3707

Cover photo: Pedro Salvador

This report can also be read online:www.worldreport-ind.com/angola

WWhile a fragile peace isgaining in strength inAngola and the econ-omy shows signs ofexpanding, how will its

war-shattered citizens put together theirlives, and what will be their priorities?

In a nation where hundreds ofthousands of people are malnourishedand depend on airlifted supplies, self-sufficiency in food is the top priority.Angola ought to be capable of producingenough to feed its 12 million people, butmore than a quarter of a century of civilconflict has left the country’s agricultureand infrastructure devastated.

Angola is among the world’s poorestcountries, yet its oil and gas reserves –and its diamonds and other mineralresources – could turn it into one of theAfrican continent’s richest nations ifthere were peace and stability.

At least one million people have beenkilled in the conflict that has gone onalmost continuously since independencefrom Portugal in 1975. Last year, 388were killed and more than 450wounded, many of them children, byland mines alone. One estimate puts thenumber of mines around the country-side at 10 million.

UN secretary general Kofi Annan hassaid there are “encouraging signs” ofmovement towards peace in Angola.TheSecurity Council has been discussing areport on Angola presented by thesecretary general and a report by the UNsanctions monitoring committee.

In March, Angola’s MPLA (PopularMovement for the Liberation of Angola)government announced a peace plancalling for the leader of the Unita rebelforces, Jonas Savimbi, to declare anunconditional ceasefire, hand in hisweapons to the UN, stick to the 1994Lusaka Protocol and participate in anelection, tentatively scheduled for 2002.

Angola’s president, Jose Eduardo dosSantos, says Unita’s activities havebecome increasingly isolated and it haslost its capability for major operations.“We have been making calls for peace,and we still think that the Lusaka peaceaccord is the sole valid tool to settle themilitary crisis in Angola,” he says.

Foreign minister Joao de Miranda haswritten to the UN Security Council,urging it to tighten its eight-year-oldsanctions against Unita. Mr de Mirandasays the sanctions, which include a clampdown on smuggled diamonds usedto pay for the rebels’ arms, have had “apositive impact, significantly reducingUnita’s war-making capacity”.

Paulo Teixeira Jorge, secretary of theMPLA’s political bureau for internationalrelations, highlights the irony of the situ-ation Angolans have found themselvesin. “If Angola were a country withoutgreat resources, we would not have thiswar,” he says.

According to Angola’s finance ministerJulio Bessa, the economy is expanding asinflation declines and the currency stabil-ises. “The decline of inflation and thestability of the national currency have

ppootteennUUnnlloocckkiinngg aa llaanndd

Angola is among the world’s

poorest countries but its oil

and gas reserves, diamonds

and other minerals could

turn it into one of Africa’s

richest nations

Angola Burman p2 11/6/01 10:49 AM Page 2

territorial administration. “We do notlike to beg. It is the war that forces us toreceive free food,” he says.

Presidential adviser Carlos Feijo saysthe fighting has held back agriculturaldevelopment in many rural areas. Thegovernment is in control of most of thecountry, but while rebel activity persists

“we must organise agricultural areaswhere war cannot reach, and protectothers”, he says.

President dos Santos, one of Africa’slongest-serving heads of state, has

announced that he is to stand down at thenext election, which is scheduled to takeplace next year. After more than 20years in the job, he says: “It is onlynatural that in our society and in ourcountry there should be other peoplecapable of discharging these duties. It ismy desire to open this possibility and thatis exactly what I have done.”

Among the possible successors to thepresidency is Joao Lourenco, the currentsecretary general of the MPLA, whichhas dominated Angolan politics sinceindependence from Portugal in 1975.

He says his party is willing to enterinto dialogue with Unita as long as itfalls within the framework of theLusaka Protocol, which requires Unitato disarm completely.

“Since 1998 when the last blue helmet(UN peacekeepers) departed from Angolawe have been fighting alone against theenemy, without any support,” he says.“We are making great economic effortsthat the international community shouldrecognise.

“Thanks to these efforts, we now havesome political stability in Angola, and thatis important for the development of theSADC (Southern African DevelopmentCommunity) region.” ■

World Report ANGOLA 3

INTRODUCTION

❑ Angola was one of the threeprincipal recipients of foreign directinvestment in Africa last year. Amongthe world’s least-developed countries,it topped the list of FDI recipients in 1999, taking in a massive$1.8 billion.

About 90 per cent of the FDI toAngola is absorbed by the oil sector,into which the multinationals havepoured billions of dollars. Principalinvestors are the US and France.

Outside the petroleum and diamondsectors, investment has inevitablybeen deterred by the civil conflict.Portugal, the former colonial power,was the leading investor outside these sectors last year, reaching $123 million. In the past five years,Portuguese investment in Angola hasseen rapid growth, estimated to haveincreased 90 per cent year-on-year.

Sectors offering opportunities forinvestment include mining (not justdiamonds), agriculture and fishing,food processing, soft drinksproduction and brewing. Coca-Colainvested $36 million in a newbottling plant last year.

According to Joao de Miranda,minister for foreign affairs, thecountry’s western regions offerparticularly valuable opportunities.

“The majority of the preciousresources lie in the west, where warhas never been a problem,” he says.“There is still room for our partners toinvest with high safety.”

Critics contend that much of thebillions of dollars in development aid that has already poured intoAfrica has gone into useless projectsor been siphoned off by corruptofficials. In some cases, critics say,

donor cash has enabled governmentsto abdicate social responsibility.

Delegates at the 14-memberSouthern African DevelopmentCommunity (SADC), of which Angolais a member, were told at its annualsummit in August that the region’seconomic growth was too low to haveany impact on poverty.

Although the economy grew by 3.4 per cent last year, that is too lowcompared with the World Bank’sminimum of six per cent.

Top of the investment list

Rapid growth: cash inflows from overseas firms topped the $1.8 billion mark in 1999

nnttiiaalldd ooff hhuuggee

LOURENCO

‘We are making greateconomic efforts thatshould be recognised’

DE MIRANDA

‘There is still room forour partners to investwith high safety’

JORGE

‘If Angola were a countrywithout resources wewould not have this war’

• Geological and geotechnical surveys • Land stabilization• Injection of cement and other products • Lowering of phreatic levels• Barrier, tunnel and bridge construction • Foundations of all kinds

With all the technical and human resources

at our disposal, we aim to consolidate our

leading position and to continue playing a crucial

ROLE IN ANGOLA’S DEVELOPMENT.

Geotécnica: a reputation that’s built to last

Rua N’Gola Kilwanje, Luanda, Angola.Tel: (244 2) 324 287 / 381 987 / 381 795 Fax: (244 2) 322 969 / 382 730

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Angola Burman final 11/2/01 9:30 AM Page 3


FINANCE

Anew 17-storey building on theskyline of downtown Luanda isone of the more visible signs thatthe war-shattered economy of

Angola is beginning to get back on its feet.The $50 million tower block is the

headquarters for the wholly state-ownedBank of Commerce and Industry (BCI).Accelerating its privatisation programme,the government is planning to sell a stakeof up to 51 per cent in BCI by 2002.

Other financial institutions beingconsidered for sale include Angola’sSavings and Credit Bank. More recently,the state-owned Agriculture and FisheriesBank was closed down as part of theInternational Monetary Fund’s (IMF)restructuring programme for the country.

The banking sector, like every part ofthe economy, virtually needs to be rebuiltfrom scratch or extensively restructured,and there is pressure from the IMF forinstitutions to become more transparent.

The central bank, National Bank ofAngola (BNA), is working to becomemore independent from the state whileplaying a leading role in reform.

“Angola has made a major effort,” saysbank governor Aguinaldo Jaime. “It hasdone so under particularly harsh condi-tions because we lack resources, despitethe increase in the price of oil. It is abouttime the financial institutions matchedthe major efforts of the government.”

He points out that the authorities aretrying to achieve a seismic shift from acentralised to a liberalised economy inwhich the private sector plays the major

role. “When we decided to shift awayfrom that kind of [centralised economy]model, the reform programme started.

“Our first change was to liberalise theexchange rate because it used to be fixedadministratively by the central bank. Infact, there were times when the differencebetween the official exchange rate and theparallel market exceeded 500 per cent.

“We are modernising the functioningof the national monetary market and weare strengthening our supervision depart-ment so that all the players in the finan-cial system can play according to therules. All these measures have been takenwith one objective – to make the centralbank totally independent from the state.”

In the private sector there are BAI, anAngolan investment bank, BCA, anAngolan commercial bank, and threePortuguese firms – Banco do Fomento,Banco Portugues do Atlantico and BancoEspirito Santo. There is also a handful ofbank representative offices, includingCitibank and Banque Paribas, providingspecialised financing and services.

Mr Jaime adds: “We are trying to giveincentives to the private sector so thatthe economy can function properly. We

think the best way of helping the privatesector is to have a modern and rebuiltfinancial system. In this way, we areintroducing competition and we wantmore banks to come to Angola.

“We have taken some very courageousmeasures. This is not easy because peopleare used to having everything providedby the state. They are not used toemployment competition and efficiency,and it takes some time to be understood.”

In its drive to make the sector moretransparent, the central bank has takenmeasures to eliminate tax evasion andemployed foreign experts, some fromBritain, to reform the tax administration.“Efficiency will increase as a result ofthese measures and our reforms will createa good economic structure,” he says.

The launch of central bank bills hascreated a primary market between theBNA and other banks. In turn, asecondary market is appearing in whichthe banks pass on the bills to the public.

Mr Jaime says people were scepticalwhen the bills were first introduced.“They would not believe in the efficiencyof these bills because they knew the state had a big foreign and national debt.But our internal reserves have increasedgreatly, the exchange rate is quite stableand we don’t have the frustration we hadbefore. There is no depreciation of thenational currency any more.

“Now people realise that instead ofbuying dollars to keep their savings theycan invest them in national currency incentral bank bills because the remunera-tion is attractive and the interest rates areabove inflation. The finance ministry is

also preparing treasury bills that willsupplement the role being played by thecentral bank,” he says.

The largest bank in terms of capital,BCI granted more than $11 million in

loans last year, a 42 per cent increase on1999. Generoso Hermenegildo Gasparde Almeida, chairman of the BCI boardof directors, says fixed deposits have risen302 per cent over the same period. Thebank is in the first year of a three-yearstrategic restructuring plan and progresshas been “positive” so far.

Relations with foreign banks havegreatly improved and Mr de Almeidasays an account reconciliation process isunder way. Dormant loans have beenrenegotiated with Portugal’s EspiritoSanto Bank and new credit facilities havebeen devised for the trade sector andsmall investments.

BCI has branches in 10 of Angola’s 18provinces, as well as several agencies.With more than 4,300 accounts, Mr deAlmeida, who joined the bank in Febru-ary last year, says it is planning to expandits network of branches in Luanda andother parts of the country.

Privatisation is welcome, he says, as this will give Angolan investors theopportunity to buy shares in BCI forthe first time.

A former governor of the centralbank, Mr de Almeida adds: “Today, thesituation is very different because the

Measures to restructure and

privatise the financial sector

aim to promote competition

and increase transparency

Reform programme seeks

State insurer gets ready to compete after❑ The insurance sector in Angola isdominated by the state-ownedNational Insurance and ReinsuranceCompany, Ensa, which enjoyed amonopoly for more than two decades.

With the liberalisation of the sectorthrough new legislation passed lastyear, there is now competition forEnsa’s share of the market.

The new entrant is AAA Seguros andother insurance companies are alsobeing set up. “At the momentwe are effectively handling thecompetition from AAA Seguros,”says Ensa president Aleixo Augusto.

“We are not afraid of competition.

Competition must occur, but we mustprepare the necessary weapons so thatwe don’t get hurt in the marketplace.I believe competition is good becauseit creates quality.”

As the market develops in Angola,he suspects that some social burdensmay be lifted from the government’sshoulders. “More insurance activitywill bring social security benefits andhelp the economic development of thecountry. The insurance sector cancomplement social security.”

Mr Augusto, who has been withEnsa since its creation in 1978,adds: “With the development of

Angola, new investors are coming hereand they will require guarantees fortheir investments.”

Ensa, which covers most areas ofinsurance, is to gain new status as anautonomous society before being soldby the government. “The state is

JAIME

‘Our internal reserveshave increased and theexchange rate is stable’

AUGUSTO

‘New investors arecoming here and theywill need guarantees’

Relationships with foreign banks haveimproved greatly

Credit to the nation: the BNA is working to make the sector more efficient and modern, and is improving th


FINANCE

BNA and the ministry of finance cancontrol inflation. There are still somethings that escape control, because thecountry needs more stability and freecirculation of people and goods, but the

way things are going it is easier to main-tain tighter control to combat inflation.”

About 60 per cent of BCI’s operationsare related to the import and exporttrade. “With the new measures it hasadopted, credit control is made indirectlyby the central bank. Because of ourinternal assets we can provide credit with

better facilities, so we can now supportsome industries and projects.”

BCI also works on behalf of astate-created fund that was created tosupport small investors. The Fundo deDesenvolvimento Economico e Social(FDES) was set up to motivate smallentrepreneurs and it grants credits of upto $500,000. “We have had hundreds ofrequests and the first investor projects

were approved this year,” says Mr deAlmeida. “We have already created a realestate department and we will developother sectors in order to increase ourinternal capital.”

As Angola develops, it will need adeveloped capital market. “The bankscan provide a safe passage for this phasebecause we are more organised and weknow how to manage such things,” he

adds. “There will be a need for enter-prises that have the organisation andcapacity to manage the market and ourbanks can do it.

“Angola is changing and we are gettingthe stability and peace we need. Manyforeign companies are coming here.Now is a good time for people to invest.Privatisation will allow the entry offoreign partners in the banking sector.” ■

Diamonds are the jewel in the crown of Angola’s miningindustry and ASCORP is the sector’sleading player. The company hasmore than delivered the goods, contributing substantially to theAngolan national budget since itsfoundation in February 2000. In that short space of time, we’ve

built a reputation for providing aconsistently high standard in bothour products and services, while ploughing back profits into commu-nity development. This commitmentto quality and steady growth coupledwith crystal clear vision has beenappreciated by our shareholders andthe Angolan people alike. A prosperous future for both ASCORPand Angola is guaranteed.

Rua Tipografia Mama Tita, Edificio Soleil BP.O. Box 3978, Ingombotas, Luanda, Angola Tel: (2442) 396465 / 397615 / 394724 Fax: (2442) 397615E-mail: [email protected]

to rebuild the banking business

new legislation

ALMEIDA

‘We can provide creditwith better facilities andsupport some industries’

ng the administration of taxation to eliminate evasion

preparing the legislation to sell partof Ensa’s shares,” he adds. “Whenthe law is approved, we are countingon the participation of severalpartners to help us apply newtechnology and train staff.”

Ensa’s main clients are in thepetroleum business. Few Angolanshave any form of personal insurance,but the long-term prospects fordeveloping new products andmarkets are good.

The government has created theInstituto do Supervisao do Seguros,a watchdog body which will track thedevelopment of the sector.


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Angola page 6 31/10/01 1:10 am Page 6


FESA - Eduardo Dos Santos FoundationRua da Companhia de Jesus 4, (Complexo Endiama) Miramar P.O. Box 545, Luanda, Angola

Tel: (2442) 34 98 07 / 34 68 66, Fax: (2442) 34 68 66, Mobile: (244 91) 50 52 52E-mail: [email protected]. Website: http://www.fesa.og.ao

At the Eduardo dos Santos Foundation

(FESA) we know that true progress starts

with today’s generation. We are a fully

established, non-partisan and non-profit

organisation which aims to bolster the

quality of community life throughout Angola.

Since it was founded in 1996, FESA has

invested over US$30 million in the sectors of

education, healthcare, sports and scientific

research and development. We make the

welfare of Angola’s young our top priority

and, from providing adequate schooling

facilities for urban students to encouraging

participation in athletic programmes, we do

our utmost to promote an egalitarian and

progressive society.

FESA: Instrumental inspearheading socialchange in Angola.

Angola page 7 31/10/01 1:21 am Page 7

PROVINCES


There is potential for developmentand investment throughout the 18provinces of Angola. Carlos MariaFeijo, adviser of the president for

territorial administration, advocatesgreater incentives for foreigners investingin “the most difficult areas, rather than the capital, Luanda, so we can haveequilibrium in the country”.

The coastal region of Angola – whichincludes the provinces of Zaire, Luanda,Bengo, Kwanza Sul, Benguela, Namibeand the enclave of Cabinda – has beengiven high-priority status for developmentin agriculture, tourism and industry.

Others, such as Kwanza Norte,Huambo, Uige, Bie and Malanje, aremedium-term priorities. Meanwhile theeasternmost and largest provinces ofLunda Norte, Lunda Sul, Moxico andKuanda Kubango, to which most goodsare supplied by air, will take considerablylonger to join in the slowly revivingeconomic life of the country.

The government has devolved greaterpowers to the provinces. Minister ofterritorial administration FernandoFaustino Muteka says: “The daily life,development and fulfilment of thestate’s policies are exercised by the gov-ernors under the supervision of the ministry. The government has approvedagricultural programmes for allprovinces. We transfer the money to theprovincial governors who are develop-ing production activities.

“Provinces such as Uige, Bengo,Kwanza Norte and Kwanza Sul couldproduce coffee when there is total peace.To those interested in producing coffee,we will give the land that has been leftwithout anybody working on it,” he says.

The province of Cunene rears cattleand goats and produces a lot of sorghum,whereas Huila, whose infrastructure hasbeen less devastated, has the capacity togrow a variety of crops.

Benguela is an important producer offruit, sugar cane and maize, while cassavaand maize are vital crops in Malanje.Namibe has the potential to vastlyimprove its fishing industry, while timberis a valuable export in Cabinda and ricecould be grown in greater quantities inboth Bie and Kuanda Kubango.

The province of Benguela benefits fromits petroleum resources as well as arelatively well-developed agriculture andfisheries sector. There are around 50 -farmers’ associations and many agrarianprojects are being implemented by non-governmental organisations.

Benguela’s governor, Dumilde dasChagas Simoes Rangel, says: “In futurewe intend to consolidate the fisheriessector so that we can have more organ-ised sales operations and better produc-tion, because our products are often soldbelow production costs. We will deter-mine a reliable price so that we canprotect our national producers.”

The governor is determined that:“The agricultural sector and the develop-ment of livestock will be the motor ofour economy.”

Petroleum and industrial projects areplanned for the province, including a4,000-hectare site intended for an oilrefinery and small industries to support it.The rehabilitation of a sugar factory, thecement industry and the port of Lobitoare also on the drawing board, along with

infrastructure improvements and plans toinvest in hotels and tourism.

Mr Rangel says: “This province is rich inbeaches, nature parks and museums. Weare investing in hotel construction andtourist facilities.”

The government established the Fenixfund to develop Benguela in collaborationwith Portugal. It is open to all foreigninvestors and Mr Rangel says there hasalready been interest from Britain, Spainand the US.

“With this fund we will help small andmedium-sized enterprises to transform sothat, eventually, we will be able to avoidthe need to import some products.”

Rehabilitation of the railways is alsounder way, with the aim of connecting theprovinces of Benguela, Huambo, Moxicoand Bie, as well as developing the link toNamibe and on to South Africa.

Nearly half the size of England with apopulation of just 255,000, Namibe is asouthern province bordering the AtlanticOcean and Namibia. In addition to itsbeaches, extraordinary rock formationscan be found in the desert and a widevariety of wildlife in the national park ofIona. The Cunene is the only river thatflows throughout the year in this region.

According to Namibe’s governor,Salomao Xirimbimbi: “Although Namibewas not affected by the war, developmentwas limited. Now the president hasdefined a strategy for the rehabilitationand development of each province.” Thisruns until 2004 and one of its toppriorities for arid Namibe is irrigation andsupplying water to towns and villages.

The province is the third largest forcattle rearing and is the main goat andpoultry producer. Mr Xirimbimbi adds:“We are the only province in Angola thatproduces grapes and olives, and we alsogrow tomatoes, cabbages, carrots, lettuce,onions, sweet potatoes and cassava.”

Fishermen work in the rich waters offNamibe’s coast, where 65 per cent of

Investment opportuniti e

Angola’s 18 provinces have

been granted greater

autonomy by the government

and their governors are

seeking to boost agriculture

to obtain self-sufficiency

RANGEL

‘We intend to consolidatethe fisheries sector to raise production’

The coastal regionhas been givenhigh-priority status

Benguela Namibe

Benguela: a relatively well-developed agriculture sector with many agrarian projects implemented by non-governmental organisations

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PROVINCES

Angola’s catches are made, but the fishingindustry has slumped and requiresrehabilitation. Fishmeal would solve theproblem of cattle feed, he says.

Namibe has mineral resources, such ascopper, tin, marble and quartz, and thereis a possibility that diamonds could alsobe found in the province, while oil may liebeneath its offshore waters.

Namibe is one of the most accessible ofthe Angolan provinces. “We have enor-mous potential in tourism,” he says. “Wehave beautiful panoramas and flora that isunique to the world, such as the curiousdesert plant Welwitschia Mirabilis, which isfound only in the desert of Namibe.

“We have nice beaches and the watersoff Namibe are the best off the WestCoast. We have facilities for water sportsand for safaris, and we have peace. Whatwe don’t have is investment.”

Uige’s governor, Cordeiro Ernesto Nzakundomba, is also seeking self-sufficiency in food production for hisprovince, as well as the chance to growcrops for export. Coffee was once a majorexport until civil unrest drove peopleaway from the land. Fruit juices andbeverages were also produced, but thefactories have long since closed.

“There is a national programme tofight the Unita rebels, and there is goodcooperation between the provinces. Thereis also cooperation in the agriculturalsector and in cattle breeding in order tocreate food self-sufficiency.”

Mr Nzakundomba says that in colonialtimes there was some exploitation of theprovince’s mineral resources, includingcopper, uranium, lead, zinc, gold anddiamonds. “Sources have been locatedand identified, but not been exploited.We haven’t had time to develop these.”

The province’s tropical rainforest couldprovide a managed source of hardwoods,he adds. “We are open to any type ofinvestment. Our people are welcomingand we’ll do everything we can to make

investors feel at home here. Once we havepeace and some investment, we will beable to restart coffee production – it is notlabour intensive and we have a good

climate,” says Mr Nzakundomba. “Ourpriority is to restart agricultural produc-tion. From there, we want to createmicro-industries for food processing andgrow little by little. We must achieve foodself-sufficiency.”

Soft drink manufacturers have alreadyset up in Uige, and some coffee is beinggrown – and a little exported. Other cropsinclude cassava, sweet potatoes, bananas,peanuts, beans and maize. These are allintended for local markets, however,as the province is virtually isolated fromthe rest of the country as a result of poorroads and wrecked bridges.

While the provinces have gained someautonomy, Mr Nzakundomba believesthat “political power without financialresources is useless”.

He says: “The trouble is, all the invest-ments are centralised in Luanda, whichdisburses them later. The provincialgovernors are pushing for financial decen-tralisation in order for them to allocatefunds more efficiently.”

Huambo province has suffered most fromthe war. About three-quarters of itspopulation are displaced citizens, theinfrastructure is badly damaged andindustry is at a virtual standstill. Butgovernor Antonio Paulo Kassoma saysUnita rebels failed in their attempt toconquer the province, and the movementled by Jonas Savimbi has been “totallydefeated” and will never recover.

There are sporadic outbreaks ofguerrilla warfare, but Mr Kassoma says

i es from coast to coastXIRIMBIMBI

‘We have potential. Wehave peace. What wedon’t have is investment’

As the only pharmaceutical company in Angola, ANGOMÉDICA is looking tobecome a leader in the SADC. Angomédica is seeking investors to share

knowledge and technology and join in their success.

AngomédicaBairro Palanca, Rua do Sanatoria

P.O. Box 2698, Luanda, AngolaTel: (244 2) 363765/75

Fax: (244 2) 362336


Uige

Huambo

NZAKUNDOMBA

‘Once we have peacewe will be able to restartcoffee production’

Namibe: one of the most accessible of the Angolan provinces with many opportunities for tourism, and facilities for water sports and safaris

continues on page 10

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PROVINCES

Since its creation in 1987, TECNOCARRO has been growing and expanding with the addition of other companies in key economic sectors.HABITAR - Sociedade de Construções in the construction industry and IMBONDEIRO - Condominiums & Resorts, a real estate company, are veryactive in the Angolan market. In the food industry, PECCUS’ main activity is livestock and is constantly seeking to improve its business.TECNOCARRO offers continual training to its 2,150-strong work force. Keeping the future of the country always at the forefront, TECNOCARROcontributes to the social, as well as the economic, development of Angola.

We provide for the needs of Angola

Rua Alfredo Troni , Edif . BPC - 13th Floor , Luanda, ANGOLA

T e l : ( 2 4 4 2 ) 3 9 2 1 2 6 / 3 9 2 0 2 8

Fax: (244 2) 330976 , E-mai l : t ecno .cp t@sne t .co .ao

Rua D. Francisco de Almeida, Lote 4 , 2754-524 Cascais , PORTUGAL

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-Grupo Tecnocarro-


these will end when people have thenecessary means for agricultural work andliving standards improve.

The capital, Huambo city, was foundedby the Portuguese in the early 20thcentury. With much of it destroyed now,the aim is to reconstruct the city’s infra-structure. Mr Kassoma says Huambo’sagricultural land is fertile, but lack ofirrigation is holding back development.Maize, potatoes, beans and soya beans

are the main staples grown as cash crops.“In Huambo our slogan is ‘Agriculture isthe petroleum of Huambo’. Cabinda hasthe oil and can develop with oil, whereaswe have agriculture and that must func-tion as the financial engine to develop theprovince,” he says.

Huambo has a university facultydevoted to agricultural science and anInstitute of Agronomic Research. Withassistance from foreign organisations,these two centres are being reactivated totrain more people in modern agriculturalmethods, including peasant farmers.

Mr Kassoma says: “Following theexample of Germany, we are starting theindustrialisation of Huambo with micro-industries, which give people jobs andallow them to earn some money, and alsocreate the capacity for bigger industriesto get started.”

The biggest investments in Angola arebeing made in the oil industry and in thecapital, Luanda. The Huambo governorsays it is vital that the government directsmore investment to the provinces and thatthe way to do this is to grant investors inthe provinces even greater incentives.

Lunda Norte province has received agovernment-distributed cash injection of$2.68 million – its share of earningsfrom the diamond industry – for socialdevelopment.

The Programme for the Stabilisation ofthe Diamond Sector (Proesda) has been setup to restructure the industry. Althoughdiamonds will continue to be a vital sourceof income, the provincial government hasmade food self-sufficiency a top priority,with the modernisation of its 48-year-oldhydroelectric plant a close second.

Lunda Norte is 1,300km from Luandaand 1,470km from Benguela’s ports. Thepoor state of the roads and the threat ofattack by rebels and robbers makes roadtransport hazardous and everything has tobe airlifted. Even so, UN food aid flightsto several towns were suspended earlierthis year because of attacks on cargoaircraft by Unita rebels. Rehabilitation ofthe province’s infrastructure will takeconsiderably longer than hoped.

Lunda Norte’s governor, ManuelFrancisco Gomes Maiato, believes thepopulation “became lazy” as the diamondindustry, initiated by the Portuguesecolonialists, rose in importance and tookpeople away from the land.

“This is one of the poorest provinces inAngola,” he says. “We have a food deficitbecause our people are not used to prac-tising much agriculture. For two years

we have been promoting agriculture andlivestock because the government foundit better to involve the population in theseactivities. But we have had positiveresults. Besides diamonds, I would like todevelop more mechanised agriculture andlivestock rearing.”

In Bengo province, governor IsalinoMendes faces problems that are familiaracross Angola. “Our population cannotkeep on depending on the support ofnon-governmental organisations,” he says.

There is hope that petroleum may befound in exploitable volumes but, he says,“the challenge for our government is theagricultural sector because farmers com-prise 80 per cent of our population”.

Three big rivers flow through Bengoand, with the completion of two irrigationschemes, some 85,000 hectares of landwill come under cultivation. Corn, sun-flowers and tomatoes are the preferredcrops because they will form the basis ofprocessing industries.

MAIATO

‘I would like to developmechanisation andlivestock rearing’

KASSOMA

‘Agriculture mustfunction as the engine to develop Huambo’

Lunda Norte

Bengo

Lunda Norte: agriculture is a top priority

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PROVINCES

Bengo, strategicallylocated on Angola’s

coast and readily accessible from thecapital Luanda, is a

province with a future.With significant waterresources and a smallpopulation, Bengo isperfectly suited to

become the country’spremier agricultural

zone, cultivating cropsranging from maize to

tomatoes. Plus, theprovince’s 50-km-long

coast holds greatpotential for the development of

industries such as aviculture and fishing,

as well as that of shipping.

By encouraging agri-cultural development

and implementingupgrades in infra-

structure and electricity provision,the government ofBengo is aiming to

bring greater prosperity to all.

The province of Bengois ready for the futureand to receive foreign

investment.

Caxito, Bengo, Angola Tel: (+244) 34 81032 / 81072, Fax: (+244) 34 81004


Fisheries – Bengo has a 50km coastlinebut no fishing ports – timber and possiblypetroleum could contribute, although MrMendes insists: “Agriculture will be themotor for development in this province. Iam optimistic because we are closer topeace and our economy is stabilising.”

Petroleum is the main resource of Zaireprovince. Governor Ludy Kissassundasays: “We have more than 300km ofcoastline and rich fishing waters, but thereis no infrastructure for a fishing industry.Our strength is in agriculture – in someregions we harvest beans twice a year andwe grow a lot of corn, fruit and manioc,the staple food of this region. Much morecould be grown.”

He adds: “At this moment the level ofdevelopment in every sector is low. Thepetroleum sector is the target for invest-ment, but our long-term bet is on theagricultural sector because petroleum is a non-renewable resource. We cannotdepend on petroleum alone.”

As Mr Kissassunda points out, theprovince was once self-sufficient in manysectors. “We imported almost nothing,”he says. “With peace we can avoid for-eign imports and work by ourselves. It issenseless for us to buy beans because wecan produce them in high quantities, andeach of Angola’s provinces can produceenough to feed its people.

“We have many rich resources and weare ready to work with partners. Andthere is also a great possibility of creating agro-industry in Zaire,” he says.

In contrast, the province of Lunda Sul’smost urgent requirement is energy andpetrol has to be brought in by air on adaily basis. The need for a hydroelectricstation is pressing and a $35 million pro-ject, which will require foreign invest-ment, is being evaluated. The provinceonce exported rice and, says governorFrancisco Sozinho Chihuissa, there ispotential to grow more, as well as corn,

peanuts and manioc. “But without fuel, itis very difficult to modernise agriculture.”

He adds: “For now we are committedto developing the energy sector only. Eventhe Catoca project (a diamond mine) hasenergy problems. They have been usingdiesel generators and have to spend a lotof money on fuel transportation.

“We don’t have any industry becausepeople want to invest in areas with goodenergy supplies. As we improve ourenergy sector, we will also see improve-ments in our agricultural production.” ■

MENDES

‘I am optimistic for thefuture because oureconomy is stabilising

Zaire

Uige: wants to create micro-industries for food processing, and the region’s tropical rainforest could provide a managed source of hardwood

Lunda Sul

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Travelling around Angola is a bit ofa nightmare. Roads, bridges andrailways have all been severelydamaged during years of civil war,

to which may be added problems causedby millions of land mines littering thecountryside, as well as flooding in therainy season and drought elsewhere.

Efforts are now being made to rebuildkey routes, but the fact that so manybridges have been destroyed means thattransporting materials is especially diffi-cult. The reopening of the road linkingthe cities of Huambo and Benguela viaLonduimbali, for example, dependedentirely on the reconstruction of bridgesover the Colongue and Cuito rivers.

Despite the fact that the Huambo-Londuimbali-Benguela road was paved,until the bridges were built motoristswere obliged to go via Ganda. Seasonalrains caused severe damage to this routeearlier this year and it took drivers up to25 days to make the journey.

The Empresa Nacional de Pontes(National Bridges Company, or ENP) isstruggling to reopen routes as fast as itcan. General manager Antonio Goissays: “Everything that was of benefitto the population was destroyed duringthe war. The majority of the bridges have

been destroyed.” He says some can berepaired, but many others will have to bereplaced with entirely new structures.“Our objective is to connect the entirecountry through the reconstruction ofbridges, and at the same time connectareas where only ENP can go.

“Foreign firms will not go to remoteareas because of the lack of security. So itis our duty to reconstruct the bridges. Weare a public company and so we mustwork all over the country.”

ENP is not yet being considered forprivatisation, but joint ventures withforeign firms have not been ruled out.Mr Gois hopes such a venture may becreated with a British firm that has been

supplying steel girder bridges. ENP, whichemploys around 400 people, also carriesout road building and other civil works.

The vast majority of businessmen,international visitors and politicians useplanes to reach Angola’s cities andtowns, and air transport will remain vitalfor the distribution of goods until theroads and railways have been sufficientlyrepaired. It is not, however, an optionavailable to the vast majority of thepopulation, most of whom work on theland, and much perishable agriculturalproduce is unable to reach widermarkets. Nor is it always possible todeliver vital goods and materials to manyremote rural areas.

As with all sectors of the country’seconomy, investment is desperatelyneeded to ensure that the aviation systemcontinues to function adequately.

Manuel Nunes Junior, chairman andmanaging director of the NationalAirport Operations and Air NavigationCompany (ENANA), says renovation ofLuanda’s 4th February Airport, Angola’ssole international facility, is “a move thatcannot wait much longer or the airportitself will enter into a stage of collapse”.

Work on renovating the airport hasalready begun and the cost is estimatedat $300 million. Mr Nunes Junior saysmost of the work will be self-financed.The 4th February Airport is mainly usedfor cargo, including fuel, raw materialsand food. It handles fewer than onemillion passengers a year.

Plans for a second internationalairport in Luanda are being drawn up.Two sites are being considered, Vianaand Cabo Ledo, but construction workis not expected to begin until 2015 andwould take up to 10 years to complete.In the meantime, Huambo airport willact as an alternative international linkwhen poor weather affects Luanda.

There are 18 airports and a number ofsmall landing strips around the country,and all the provinces are accessible byair. “Aircraft are the most frequentlyused means of transport in the country,”adds Mr Nunes Junior.

A number of state-owned airlines haverecently consolidated to form a singlegroup. The move will add to the opera-tional fleet of national carrier TAAG.

The airlines involved are Sociedadede Aviacao Ligeira (SAL), Angola AirCharter (AAC) and Sonair. SAL, which is51 per cent-owned by TAAG and 49 percent-owned by state diamond authorityEndiama, has nine Beechcraft passengeraircraft and a staff of 200, including 50pilots. AAC is mainly a cargo operationwhile Sonair, an offshoot of state oil

company Sonangol, is used to ferryaround oil officials.

AAC carries cargo throughout theregion, including the Democratic Repub-lic of Congo, Namibia and Congo Braz-zaville. “We no longer fly to Europe andthe US,” says general manager AlfredoVaro Kaputu. “First we have to consoli-date here and in the Southern AfricanDevelopment Community (of whichAngola is a member). We hope to restartinternational flights within two years.”

Back on the ground, Caminhode Ferro de Luanda (CFL) is seeking$600 million to rehabilitate the railway

The country’s air, road and rail transport facilities all require

an extensive programme of modernisation and investment

INVESTING INTODAY TO GUARANTEE ENERGY FOR THE ANGOLA OFTOMORROW

INVESTING INTODAY TO GUARANTEE ENERGY FOR THE ANGOLA OFTOMORROW

Prédio Geominas, 6 e 7 andares, P.O. Box 772, Luanda, Angola.

Tel: (2442) 321-499 / 324-070 / 321-142 / 323-382 / 500-411

ELECTRICITYPOWERING

DEVELOPMENT

EMPRESA NACIONAL DE ELECTRICIDADE - E.P.

GOIS

‘The ENP aims to connectthe country through thereconstruction of bridges’

Overcoming the legacies of war and

Work in progress: efforts are being made to rebuild ke y

INFRASTRUCTURE


KAPUTU

‘We hope to restartinternational flightswithin two years’


INFRASTRUCTURE

infrastructure. So too is the BenguelaRailway Company, which operates the1,340km Benguela line, the longest inAngola. It is also possible that concessionswill be offered to operator-investors inthe railways.

Angola’s main port is Luanda, whichhandled nearly 1.9 million tonnes ofcargo last year, an increase of about400,000 tonnes on 1999. However, theport is still plagued by difficulties,including broken cranes and warehousesthat are in a state of disrepair.

It needs around $200 million dollarsto modernise its facilities and, accordingto reports, the number of short-termprivate operators is likely to be reduced.

The Italian government has expressedan interest in the construction of a newport at Porto Amboin on the centralcoast in Kwanza Sul province. Theprovincial authorities have begun torehabilitate the old port, which has notbeen used since 1989. ■

flooding

ke y routes, but transporting materials is especially hard


❑ Antonio Henriques da Silva,minister of public works andurbanism, acknowledges the hugetask faced by the government inreconstructing Angola’s infrastructure.

Every province has been affectedby the civil war to a greater or lesserdegree. But Mr da Silva believes the country has the resources toaccelerate growth: “In the rehabilitationprocess we are neither at the end northe beginning, but we have the rawmaterials and the agricultural potentialto rebuild our country,” he says.

The privatisation process began in1987, but few state firms have beensold off and several have failed togrow because of lack of funds. Mr daSilva says: “For the firms that havenot been privatised we are starting anintermediate phase in which potentialbuyers enter a management contractunder a previously agreed programme.

“The buyer has to invest until allthe agreed objectives are reached. Ifthe investor shows he has thecapacity and responsibility, we willaccept the privatisation.”

The state-owned civil constructioncompany Geotecnica is hoping to pickup more work when it is privatised.General manager Elvino Junior says:“Privatisation is very important, notonly because it would allow forquicker development of the sector but because the state alone is

unable to properly manage all the[state-owned] firms in Angola.”

Geotecnica specialises in foundationwork for large construction projectslike sports stadia, housing and officeblocks, power stations and waterworks.

Mr Junior adds: “In the privatisationwe are planning to sell 70 per cent of the shares to a foreign investor, 20 per cent to domestic firms and 10 per cent to a single investor.”

The private sector is alsocontributing greatly to the rebuildingof Angola’s infrastructure and socialfabric. Tecnocarro, a conglomerate ofcompanies employing more than2,000 people, has interests inagriculture, tourism, transport, foodproducts and construction.

One of its major activities iscattle-raising, of which administratorJose Carlos Recio is very proud.“We have invested lots of money inlivestock in the south of Angola. InNamibe, Lubango and Cunene wehave about 2.7 million head ofcattle,” he says.

“We have cooperated with localfarmers because they are poor andnot able to finance their ownactivities. We invested $15 million ina European-standard slaughterhouse,and we help the farmers with watersupplies, vaccination programmesand trading their livestock.”

Daily supplies of meat are flown tothe capital, Luanda, and Mr Reciosays there is scope for the export ofmeat. All the cattle are reared onorganic feed. And, after all, he adds,meat is a renewable resource.

Tecnocarro has long been involvedin the social aspects of Angolan life.The firm provides more than 7,000free meals a day, and runs anorphanage and a clinic.

Mr Recio believes tourism willbecome a major activity for thecompany in future. Tecnocarrooperates a holiday resort near theKissama national park, and promotestourism on the Cuanza River.

In Mussulo, another resort, it hasbuilt apartments. “We are alwaysinterested in new areas of business,such as Porto Cabinda to serve the oilcommunity,” he says. “We function asa BOT (build-operate-transfer)company and train our workers to

carry on after we have left.” He adds: “We are also in a

partnership to get the Malange railcorridor working, because it is muchcheaper to transport goods by railthan by plane. We have the task of

JUNIOR

‘Privatisation will allowquicker development ofthe construction sector’

BATAGLIA

‘AMDL supports somegovernment projects inareas such as trade’

Reconstruction is a herculean taskDA SILVA

‘We have the materialsand the potential torebuild our country’

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Every provincehas been affectedby the civil war



OIL & GAS

Angola’s oil revenues contributeabout 90 per cent of thecountry’s income and there is noshortage of foreign companies

continuing to show great interest indeveloping the sector. The country issub-Saharan Africa’s second-largest crudeoil producer after Nigeria, pumpingabout 750,000 barrels per day (bpd).

With proven reserves of more thanseven billion barrels of oil and possiblyup to 12 billion, Angola has the oppor-tunity of becoming a leading economicpowerhouse on the African continent.Petroleum minister Jose Maria Botelhode Vasconcelos says: “We have adestroyed country that needs to berebuilt. Oil is the main resource. Weneed to assist the people and we needfinancial resources to do that.”

Production will hit an estimated onebillion bpd in early 2002 as operatorTotalFinaElf brings the giant offshoreGirassol field onstream this year. MrVasconcelos says some internationalcompanies are interested in moreoffshore blocks coming on to the conces-sion market in the southern Kwanza andBenguela basins. “There’s no problem ingetting companies interested, but there’snothing solid yet,” he says.

TotalFinaElf is now developing sev-eral more offshore fields near Girassol.The $2.7 billion deepwater project inBlock 17 aims to pump at a rate of200,000 bpd within six months.Girassol alone will hike Angola’s dailyproduction rate to about 950,000 bpd.

The project is at the cutting edge ofdeepwater oil drilling technology. The

wells operate at a depth of 1,360 metres,supported by a 1,300 metres riser tower.The giant floating production, storageand offloading (FPSO) vessel above thetower is able to store two million barrelsof crude.

“It is the tallest structure that has everbeen installed in the world, on or off-shore,” says TotalFinaElf deputy generalmanager Olivier de Langavant.

Two rigs have so far drilled 11 wellsand are expected to remain on site until2003 to complete a further 29.

About 1,200 workers are on board theFPSO, along with a small fleet of drillingrigs and accessory ships as the Frenchgiant prepares to tap Block 17, estimatedto hold 750 million barrels of crude.

Undersea robots have been used to layumbilical pipes carrying power andhydraulic fluid to well-heads and mani-fold stations. Production pipelinesbetween the wells and riser tower weretowed 150km across the seabed from aconstruction site in northern Angola.

Block 17 also includes partners

ExxonMobil, Norway’s Statoil andNorsk Hydro. The block is the mostpotentially lucrative Angolan offshorezone so far, along with two other areas –the Dalia field and a group of discoveriescentred on Arquidea – estimated to holdabout one billion barrels each. Dalia isexpected to come onstream, perhapswith an undersea link to Girassol, by2005 and Arquidea later.

ExxonMobil is targeting productionof nearly 600,000 bpd from its discover-ies in Block 15 in the Kizomba field.Earlier this year the world’s largest oilcompany launched a $3 billion ventureto develop one billion barrels of recover-able reserves – the largest deepwaterdevelopment off the coast of West Africa.

Kizomba A should start producing in2004, with a target output of 250,000bpd. ExxonMobil plans to developanother two fields in the same block,which will bring total production up to580,000 bpd. The firm is well under waywith development plans for Kizomba B,which has similar levels of reserves and

With burgeoning reserves,

the country has a golden

opportunity to become an

economic powerhouse on

the African continent

A newly-created entity with the powerto control Angola’s key diamondsector, Sodiam is determined to putthe sparkle back into the lives ofAngolans. Diamonds in Angola are aserious prospect and the industry’swealth-earning potential has notgone unheeded. Our reputation restson ensuring a substantial part ofthe sector’s profits are ploughedback into community projects suchas schools, hospitals and infra-structure. Thanks to Sodiam,Angola’s foundations for the futureare set to be as durable as our24-carat diamonds.

Rua Manuel Fernando Caldeira 6B-1 DtLuanda, Angola.

Tel: (244 2) 37 02 17 / 37 03 11

Fax: (244 2) 37 04 23Email: [email protected]

AA bbuurrnniinngg nneeeeddffoorr nneeww eenneerrggyy

organising all the logistics thereand Malange is certainly the biggestproblem we face, because so muchhas been destroyed and there is alack of skilled human resources.”

Escom, a company in Portugal’sEspirito Santo Group, is alsoinvolved in public works andtransport projects. It has investedmore than $150 million in watertreatment, sanitation projects andhospitals in Angola.

The firm founded African MarketsDevelopment Ltd (AMDL) with localcompanies, including Sonangol, tomake joint venture investments inAngola. Some of AMDL’s maininvestments have been made in foodretailing. In Luanda it has set up a‘cash and carry’ operation for thedistribution of goods through thecountry. AMDL also participates inmining, fishing and air cargotransport, among other investments.

“We help the government insocial areas in the provinces ofCabinda and Zaire,” says Escomadministrator Helder Bataglia. “Wealso support some governmentprojects in areas such as capitalrisks and international trade. Thefinancial support for these projectscomes from our banks.”

The air cargo firm Air Gemini, thecash-and-carry operation, and theStarfish fishing concern are jointventures with Angolans. Mr Batagliasays: “The idea is to make Angolanbusinessmen the managers of theseso that they gain know-how.”

He adds: “Our investments indistribution have been strategicbecause we want to take ourproducts to all of the country. Thatis why we invested in Air Gemini,because there are few air cargotransport firms in Angola. Today wehave a fleet of four Boeing 727s.”

Reconstruction continues from p13

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OIL & GAS

will have a production target of 250,000bpd from 2005 onwards.

Kizomba A, built by South Korea’sHeavy Industries, will take drilling tech-nology a stage further than Girassol. Alsoin Block 15, Exxon expects the smallerXikomba field to produce 80,000 bpd.

The three fields take Block 15’s recov-erable reserves to more than 3.5 billionbarrels of oil equivalent. Add in Exxon’sparticipation in another Girassol blockand the company will be involved in onemillion bpd of Angolan output by 2005.ExxonMobil owns some 40 per centequity in the block, with BP, Italy’s Agipand Statoil the rest.

ExxonMobil holds interests in nineAngolan deepwater blocks with a recov-erable resource potential of 7.5 billionbarrels of oil equivalent from 22 discov-eries. It is still in the exploratory drillingstage in several blocks.

ExxonMobil has also participated inan industry group studying the possibledevelopment of a $2 billion liquefiednatural gas (LNG) project in Angola, but

Sociedade Mineira de Catoca, Lda. is a

competent and well-known company in

the international mining industry, with a

great capacity to enhance economic and

social development in Angola.

Luanda: Rua Major Kanhangulo, 100 - 4º A, Edifício Endiama - Tel: 244 2 390 239 / 244 9502 530 - Fax: 244 9502 531 / 394378 - www.catoca.comCatoca: Tel: 244 2 399 394 / 1 917 438 63338 - Fax: 244 2 399 394

A Sociedade Mineira de Catoda, Lda. é uma

empresa de reconhecida competência e

capacidade na indústria mineira internacional,

contribuindo para o desenvolvimento

económico e social em Angola.

it has yet to decide whether to takepart in a Texaco-led project. Texaco andSonangol, Angola’s state-owned oilcompany, are jointly planning the coun-try’s first LNG plant, which is expectedto produce eight million tonnes a year.

Angola has pledged to eliminate nat-ural gas flaring within the next fiveyears, instead aiming to sell LNG to theUS, South America and Europe. TheLNG market is likely to be highly com-petitive with Nigeria recently announc-ing plans for a third LNG project, whileSaudi Arabia – the world’s biggest oilproducer – recently awarded three keygas projects to multinationals.

BP plans to spend between $6 billionand $7 billion in Angola over the next10 years. Production from the com-pany’s Block 18 concession, where sixdiscoveries have been made, is targetedto start in 2006. BP is drilling indepths of 2,000 metres in Block 31, oneof three ultra-deepwater concessions

awarded in 1999. The block adjoinsExxon’s Block 15.

Meanwhile, Sonangol is the operatorin a consortium that will exploit Block34 in the Lower Congo Basin at depthsof up to 2,500 metres. Sonangol has a 20per cent stake, Shell 15 per cent, NorskHydro 30 per cent, Phillips 20 per centand Brazil’s Petrobras 15 per cent.

Sonangol already operates Block 4and holds the concession on Block 3,while Petrobras is involved in severalexploration ventures. The Braziliancompany owns a 27.5 per cent stake inthe shallow water Block 2, which cur-rently produces 63,000bpd. ■

Natural gas flaringis to be eliminatedwithin five years



Angola pages 1-32 31/10/01 10:20 am Page 16

Huambo is Angola’s land of plenty. Corn, beans, sweet potatoes,wheat, milo... an astounding variety of natural products are harvestedhere, attesting to the fertility of the land. Plans to grow the lucrativecash crops of coffee and soybeans are underway, as is a 2001 rehabilitation programme for the Huambo-based Institute ofAgricultural Research and the University of Agricultural Science,which specializes in the fields of agri-business and food transformation. Clearly, this is a province that knows about growth. And yet Huambo is more than just agriculture. Long a crossroads for travellers by rail, road and air, the central province is making the most of a new era of peace by revamping its transportation infra-structure system and winning back its reputation for efficiency inshipping and exports. At the centre of Angola, Huambo is also at the centre of a nationwide push for modernization and renewed prosperity. With a view to improving provincial health care, education and food production technologies, Huambo i s invit ing investors to di scover a new land of p lenty.

GOVERNMENT OF HUAMBO Tel: (+244) 41-20470, Fax: (+244) 2-395678




TELECOMS

Abrighter future lies ahead forAngolan diamond mining now that the state has gained controlof the main areas of production

and clamped down on illegal trafficking. Several international firms are negotiat-

ing for exploration and mining rights inareas liberated from the Unita rebels by theAngolan army. Work is due to commencethis year in Camafuca, an area containingdiamond-rich geological formations calledkimberlite pipes, in Lunda Norte.

Construction work will be carried outby Southern Era Resources of Canada andWelox of Israel. A study indicates that thearea contains more than 23 million caratsof diamonds, worth $2.5 billion, making itthe world’s largest mine of its type.

Russian diamond monopoly Alrosa is negotiating with the Angolan governmentto secure access to four diamond deposits.A deal should be reached soon on the sizeof the stakes in a new joint venture, accord-ing to Alrosa vice-president Sergei Ulin.

South African firm De Beers, which sellstwo-thirds of the world’s rough diamonds,closed all its mines and buying offices inAngola in 1999 following United Nations’worries about ‘blood diamonds’ – illegallyobtained and sold by Unita to fund its rebelwar – leaking into the official market.

De Beers carried on prospecting for newdeposits in partnership with Endiama, thestate-owned diamond firm, until May whenit walked out following disagreement overmarketing rights. But De Beers is optimisticabout a deal which would see its return.

Diamond exports increased by 28 percent last year to $739 million and even better results are forecast this year by Ascorp,

Angola’s sole diamond-mining syndicate.The increase is a result of the government’smove to set up a single diamond-buyingagency, Sodiam, in January 2000.

Alrosa has given the sector a fillip byannouncing that it is to double productionat Catoca, Angola’s most successful diam-ond mine and one of the world’s largestkimberlite pipes, in Lunda Sul. Russianprospectors estimate reserves of 400-500million carats. Catoca’s output last yearwas 1.8 million carats, worth $153 million.

Jose Manual Augusto Ganga Junior,general manager of the Catoca MiningCompany, says the increase would moveAngola from the sixth to fourth-largestdiamond-producing country in the world.“We have 700 known diamond sources.Some are bigger than Catoca,” he says.

Glittering fThe industry suffered during decades o❑ A new era of telecommunications

was ushered in earlier this year whenthe government passed legislation thatbrought an end to the monopoly heldby state-owned Angola Telecom.

Four new licences will be issued forfixed-line services but, as elsewhere inAfrica, it is inevitable that the cheaperrollout costs of cellular networks willmake mobile phones the most popularmeans of communication.

With the launch of a new GSM (globalsystem for mobile communications)network in April, the state’s monopolyover cellular telecoms also came to anend. New mobile operator Unitel hopesto attract 150,000 subscribers thisyear – more than the total number offixed-line users in Angola.

Unitel is 25 per cent-owned byPortugal Telecom. Mercury, a subsidiaryof Angola’s state oil company Sonangol,has a 25 per cent stake and two otherfirms share the remainder.

GSM is the most widely usedtelecoms system in the world andUnitel’s subscribers will be able toconnect to around 400 networks inmore than 140 countries.

The first phase of the new system,inaugurated by Angola’s president, is a$68 million investment and covers thecapital, Luanda, and Benguela. Thereare plans to extend it to other provincesin the near future.

Angola Telecom’s cellular networkuses the older and less efficient CDMAsystem which is widely used in the US,but the company aims to develop itsown GSM network.

Licinio Tavares Ribeiro, minister ofpost and telecommunications, says:“Legislation has opened up the sectorto foreign investors so that, together, wecan develop our telecommunicationssystems.” No date has been set as yetfor the privatisation of Angola Telecom,but he says interest has already been

shown by companies in South Africa,Japan, Portugal and France.

The sell-off is likely to be carriedout in stages, with 49 per cent of theshares being offered in the first phase.

“We recognise that Angola Telecommust be privatised in order to havebetter management and efficiency,”says the company’s administrator andgeneral manager, Jose Gualberto deMatos. “We have to resolve someproblems before the privatisation –whenever we sell something, we mustsell it in good condition.”

The state has been investing tensof millions of dollars in expandingfixed-line telephony in Luanda, whilethe construction of a new eight-storeyoffice for Angola Telecom is due to becompleted this year.

Mr de Matos says the fixed-lineservices of Luanda are modernised anddigitalised, although current capacitydoes not meet demand.

“We have 60,000 fixed lines inLuanda, but this is not nearly enough,”he says. “We need to invest$10-12 million every year just to keep

these services operational. We alsohave problems expanding our networkto outlying areas.”

Angola Telecom’s priority is to reachall of the provincial capitals and themost important municipalities.“The state is obliged to providetelecommunications throughout thecountry. We cannot depend on privateoperators alone,” says Mr Ribeiro.

“At present, our network issupported by satellite as much of theterrestrial network was destroyed bywar. The state is obliged to reconstructthose systems, but we will need thehelp of private firms. We are consciousthat we have neither enough money todevelop our systems alone, nor to payforeign technicians.”

Priority has been given to thecoastal provinces because they enjoymore security as well as offeringgreater potential for industrial,agricultural and tourism development.

Angola is also participating in theSAT3 submarine cable, which linksSouth Africa to countries on Africa’sAtlantic coast as well as to Portugal.

Postal services in Angola have beendecimated by the civil war, accordingto Madalena de Lemos Neto, presidentof Correios de Angola. “We wereone of the most destroyed sectors, butwe are reconstructing some of theinfrastructure,” she says.

“At present we can assure thedistribution of the ordinary mailservice in the coastal provinces,regional capitals and some importantlocalities,” she adds.

The Angola postal service has beenworking for five years in collaborationwith Express Mail Service (EMS) tomake operations more efficient andcommercialised, although privatisationis still some way off.

MATOS

‘We need to invest £10-12 million a year tokeep services working’

RIBEIRO

‘The state must provide– we cannot rely onprivate operators alone’

Output from mostsuccessful mine is set to double

Cheaper connections: a new GSM network aims to open up the cellular telecoms market

No more hanging on the telephone

Wired up: the state needs more fixed lines

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MINING

Catoca employs 1,650 workers, includ-ing 120 from Russia and 80 from Brazil.The Angolan workforce supports about10,000 dependents. “Our objective is toassure earnings for every partner in orderto form a good and coherent company,”says Mr Ganga Junior. “We have created acommon culture in the firm among peoplefrom different countries and cultures.”

Such has been the success of the firstphase of the Catoca operation – Alrosa’sdividends from the joint venture amountedto $9.3 million last year – that a secondphase is being planned which will doubleproduction over the next four to five years.Investment in the second phase will bemore than $40 million.

Government troops have secured a30km security zone around the Catocamine, but one major drawback remains –lack of fuel. Each day, two or three Boeingcargo planes loaded with diesel take offfrom Luanda to Catoca. But Alrosa is readyto finance and manage a new hydropowerplant on the Chicapa River in Lunda Sul.

The project is expected to cut Catoca’sfuel costs by a third, saving millions of dol-lars. Alrosa has already signed a protocolwith Endiama to build a dam and hydro-electric plant for an estimated $40 million.

Antonio Carlos Sumbula, vice-ministerof geology and mines, says discussions arebeing held with a view to setting up adiamond cutting and polishing factoryin Luanda. At present, Ascorp sells onlyrough diamonds but it aims to add value

to the raw material and establish a quality‘Diamond of Angola’ mark. “We are con-vinced that we have the best stones in theworld and we want to establish a qualitylabel for our products,” says Mr Sumbula.

South African company MvelaphandaHoldings has been reported to be biddingfor a 33 per cent stake in SDM, an Angolanalluvial diamond mining firm. Productionat SDM’s operations in Cuango began in

1998. Alluvial diamonds are highly soughtafter because of their high quality.

Until recently, many diamond conces-sions have been worked by illegal miners –‘garimpeiros’ – many from neighbouringcountries, who panned for high-qualityalluvial diamonds along Angola’s rivers.The government is working on a strategyto give licences to the garimpeiros to bringthem into the official system. Concessionsare for areas of 3,000 sq km, to make roomfor these small-scale operations.

Total diamond reserves in Angola areunknown, simply because less than half the country has been surveyed. There arethought to be considerable volumes of

alluvial diamonds. “Our policy is to legalisethe garimpeiros. We want them to sell theirproduction to Ascorp and pay taxes,” saysMr Sumbula.

He says Endiama must start producingdiamonds on its own: “Up to now, it neverrun a project alone. We would like to seethis happening and it is a challenge for thisyear. We plan to reduce the size of conces-sions for better control of the areas.”

According to the UN, Unita rebels stillsmuggled about $100 million worth ofdiamonds out of the country last year, butManuel Calado, the administrator ofSodiam, says the level is falling.

“We still have illegal diamonds, but notin great quantities,” he says. “We no longerfear that diamonds are financing arms forUnita leader Jonas Savimbi. He has nomore diamond areas under his control.”

Mr Calado says people who live in themining areas are too dependent on theindustry and the garimpeiros have no othersource of income. “To solve this problemwe should industrialise the diamond areas,and develop agriculture and other sectorsto improve social and economic life.

“We are deeply concerned about the350,000 illegal foreigners exploring fordiamonds in our country. Obviously, wewill not give licences to everyone – justAngolans and people willing to work forthe benefit of those regions,” he says.

Ascorp president Firmino Valerianoadds: “When we started, many people didnot trust the viability of Ascorp. Its creationwas based on three fundamental objectives:to fight the illegal traffic in diamonds,increase revenues for the state, and to con-tribute to the social and economic develop-ment of our country.

“Fortunately, we have good relationswith the UN and Ascorp has participated inmany international meetings about dia-monds. All our government strategies weresupported by the UN, which encouragedour resolutions pertaining to the illegaltrafficking of diamonds.” ■

future ahead for the diamond trade es of conflict, but the government has now gained control of the main areas of production and clamped down on illegal trafficking

SUMBULA

‘We are convinced thatwe have the best qualitystones in the world’

Back in business: legal mining is recovering from the war and the government hopes to exploit the country’s vast untapped resources

ENP specializes in theconstruction of roads,bridges, port andmaritime facilities andhydraulic constructionprojects. Using thelatest technology andwith the active involvement of privatepartners, we aim toensure that Angola hasat its disposal a state-of-the-art infrastructurenetwork for years tocome.

ENP Rua do N’Zamba 1, Cazenga, CP 776, Luanda, AngolaTel: (244 2) 38 11 08/38 06 65/38 23 65 Fax: (244 2) 38 06 59

GANGA JUNIOR

‘Our objective is toassure earnings forevery partner’

VALERIANO

‘All our governmentstrategies weresupported by the UN’

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Bengue la is a province that continues to show great potential for the future of Angola. Boasting a strategically ideal location, a 2 million-strong population and plentiful naturalresources, Bengue la is diversifying its economy. Located on the western coast of Angola,Bengue la is home to Angola s second-largest port, Lobito. The port, combined with theBenguelan Railways, provide the inland provinces with a vital link to the sea. The province s main points of interest for further diversifying its economy include its mining and agriculture riches, petroleum resources, and fishing potential.

Through the active involvement of the private sector and its bountiful technical, human and natural resources,

Slowly but surely, Angola’s powerstations are being rehabilitated,providing electricity to areaswhich have been without reliable

supplies during the years of civil war.More than a billion dollars will beneeded for reconstruction and expansionworks to meet rising demand.

Nevertheless, despite the enormoustask of restoring the infrastructuredestroyed by Unita rebels, Angola couldone day become a net electricity exporterwithin the Southern African DevelopmentCommunity (SADC). The country hasalready signed an agreement with itssouthern neighbour, Namibia, to promote

cross-border electricity supplies, and onother issues of common interest.

Work on the largest-ever civil con-struction project in the country, a damand 520MW hydroelectric plant on theCuanza River at Capanda, 300km fromthe capital, Luanda, has resumed. Brazil-ian industrial giant Odebrecht is buildingthe multi-million dollar Capanda projectwith Russian technical assistance.

Energy and water minister Luis Filipeda Silva says: “Capanda should havebeen completed in 1994, but because ofthe war the work stopped. Then Unitaoccupied it and destroyed all the equip-ment and machines. But they did notdestroy the building itself as it wasalready at an advanced phase.”

A further seven hydroelectric damsmay be built between Capanda andCambambe (where there is a 180MWpower plant) to produce a total of5,000MW of power. “We want totransfer this potential to other regions

and to countries in the SADC,” addsMr da Silva.

Gamek, created by the government in1982, is responsible for carrying outstudies and implementing projects in theKwanza region. General manager JoseSonnemberg Fernandes says the firstunit will start operating in December2002 and the final unit will start thefollowing June.

“With the construction of Capandadam, a 164 sq km lake will be createdthat will used to irrigate the plateau inMalange province,” says Mr Fernandes.“This is an extremely rich agriculturalzone and it will encourage the develop-ment of livestock rearing.”

Gamek is trying to diversify its activi-ties. “We already have experience inother areas that could be used in thedevelopment of the country, such as theconstruction of bridges, roads and facto-ries, although our main duties are inMiddle Kwanza,” he says. “Capanda is

an extraordinarily good area in which tocreate an industrial zone and to developagriculture. It is also an area with goodprospects for the development oftourism. There are some enormous andbeautiful rock formations at PungoAndongo near Capanda.”

The struggle for powerrelies on investmentMore than a billion dollars

will be needed to rebuild

and expand the country’s

damaged electricity network

Back to business: work has resumed on the Capanda da

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Benguela continues to be Angola’s economic giant.



Bengue la

Bengue laBengue la

Mr da Silva adds: “We have beenreconstructing infrastructure wheneverareas have been made secure and wehave the finance to do so. But we are still very far from the complete rehabili-tation of the electricity network. Just torehabilitate it we will need more than

$500 million and to expand it we needanother $500 million.” Angola is a largecountry with a low population density,so it is not always easy to spread theinvestment evenly.

The country has several other potentialhydropower sources, including the Zaire

River. “We are interested in foreignparticipation,” says Mr da Silva. “Allthe conditions for foreign investment,including legislation, incentives, securityand investment guarantees, and therepatriation of money are being created.”

The Russian Alrosa diamond companyis planning to build a hydroelectric planton the Chicapa River to provide a source

of power for its $40 million investmentin diamond mining operations.

“Until 1996 the power sector wasmonopolised by the state, but today thepicture has changed,” adds Mr da Silva.“At the moment we are working to createan organisation to regulate the energysector so that investors can have moreconfidence in Angola.”

The state-owned Empresa Nacional deElectricidade (ENE) is responsible forthe generation and supply of electricity.Chairman Eduardo Gomes Nelumba isoptimistic about the future, but says itwill take at least five years to fully reha-bilitate the sector, and he emphasises theneed for outside help.

“Our government has invested, butnot enough to solve our problems. Weneed enough money to assure the areasof production, transmission, distributionand maintenance of equipment,” he says.“ENE will need national or foreign part-ners to perform some projects, and it willneed the help of the international finan-cial institutions. Only with internationalsupport will we be able to do it.”

Most of ENE’s operations are in thecoastal provinces, where there are morepeople. “Luanda is the single biggestconsumer and demand is growingdaily,” he says. “The cities of Benguela,Lobito and Catumbela are also prioritiesbecause of the industries there, includingthe new refinery.” ■

NELUMBA

‘It will take at leastfive years to fullyrehabilitate the sector’

FERNANDES

‘Capanda is anextraordinarily good areafor an industrial zone’

da dam and 520MW hydroelectric plant on the Cuanza River after it had been occupied by Unita rebels

DA SILVA

‘We are working tocreate an organisationto regulate energy’

Republic of AngolaGOVERNMENT OF THEPROVINCE OF BENGUELAP.O. Box 2Benguela, AngolaTel: (244) 72-33426 / 34885Fax: (244) 72-34480


INDUSTRY

That the ubiquitous Coca-Colacompany has opened a secondbottling plant in Angola could betaken as a sign that the country is

on the road back to normality.When the firm opened a plant in the

capital, Luanda, last year, production ofCoke went from zero to 14 million casesa year. This led to the opening of a secondplant in the southern city of Lubango.

The big difference between Coca-Cola and Angola’s home-grown industryis that the former is in the private sectorwhile much of the latter is state-owned.

What little industry the country hascentres on food processing, althoughconstruction materials, steel productionand chemicals are also important. Butmany factories lie idle due to lack ofequipment and replacement parts, orthey are running below capacity or elseirretrievably damaged.

Excluding diamond mining, oil andancillary services, the manufacturingindustry contributed just 5.5 per cent ofthe gross domestic product in 1998. Thissituation is set to change, however, as the

government plans to privatise many ofthe enterprises it owns.

Businesses scheduled for privatisationinclude three food companies in Lubango,which have lain dormant for more than10 years. The state intends to retain a 40 per cent share in these companies,according to reports.

Another sign that times are changingis that brewing capacity tripled this yearat Nocal, one of the largest breweries inAngola along with Cuca and Eka.

Among the biggest Angolan steel andtube producers, Fata (Fabrica de Tubosde Angola) and Metang (Metalurgica deAngola) are being prepared for sale. Bothwere established during the Portuguesecolonial era and are now managed via a

partnership by private Angolan firmIndufer, which has been asked by thegovernment to prepare the two com-panies for privatisation.

Indufer president Jose Pinto Dias dosSantos Neto says: “The privatisationprocess is far advanced and on course tobe concluded this year.”

According to Mr dos Santos Neto, theinfrastructure of Fata and Metang wasbadly damaged during the war, whichwas why the government decided toinstall private management to revivethem. “We have made several invest-ments to improve the group,” he says.

“When Indufer started to rehabilitateFata and Metang, many activities didnot exist. For example, today we have aschool furniture-making plant to support

education in Luanda, and we have madeinvestments in hotels and other areas.

“Any national or foreign company can participate in this privatisation,” headds. “The management contract forrehabilitation, which we have made withthe government, allows Indufer to workwith any partner it desires.”

The two firms can process an annual36,000 tonnes of steel. Indufer’s presi-dent says the plants will be working at90 per cent capacity and yield a grossincome of $15-18 million this year.

“After privatisation we intend to expandactivities at the plants, and we will opennew lines for the production of largertubes to support the petroleum firms and for export. We are also going todiversify our activities,” says Mr dos

Changing timesfor idle factories

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...always developing safely

Making headway: Indufer is rehabilitating steel and tube producers Fata and Metang for privatisation in the fu

As businesses prepare for

privatisation, competition

brings increased opportunity

and firms gain new contracts


Drug company needs help to ❑ Diseases that kill are prevalent inAngola and while international agenciesare making headway against some, thebattle against others remains.

Malaria and sleeping sickness aretwo of the major diseases which affectthe population, whilst Aids continues tospread. Angolans, like many people inAfrica, now face the prospect of newstrains of malaria which have becomeresistant to modern methods of control.

More than 25 million of theestimated 36 million people infectedwith HIV around the world live in sub-Saharan Africa. The 14-memberSouthern African DevelopmentCommunity, of which Angola is amember, has tried, unsuccessfully so far, to persuade the world’s major

pharmaceutical companies to come to acollective agreement to supply Aidsdrugs. Even relatively low-cost drugswhich could tackle other diseases are inshort supply in Angola.

Some Western firms are making aneffort to stem the rising tide of diseasewhich is sweeping across some of the world’s poorest countries. TheFranco-German company Aventis, forexample, is donating medicine to fightsleeping sickness in Africa.

Incidences of sleeping sickness, aparasitic infection transmitted by thetsetse fly, which if untreated leads todeath, has risen dramatically in Angola.There were three cases in 1975 at theoutbreak of civil war; now there aremore than 120,000 cases.



INDUSTRY

Santos Neto. “We are installing twoplants for the manufacture of metal fur-niture for schools. We make more than3,000 desks a month and we are thinkingabout constructing a factory where wecan prepare our own wood.”

Indufer is also engaged in the con-struction of accommodation for 400 ofits workers at Cacuaco, near Luanda.The housing complex includes a clinicand a football field.

“The problem we face today is thedistribution of our products across thecountry,” says Mr dos Santos Neto. “Mostof the roads are in a bad condition andsometimes we have to use planes to trans-port our products, which is very costly.”

Competition is growing as well. Fivenew factories make corrugated metal

sheets, although they are small businessescompared with Fata and Metang. “Ourstrategy is to increase output and reduceprices so that we can stay ahead of themarket,” he adds.

An exclusive contract to supply Coca-Cola means a stable future for Angases, aproducer of industrial and medical gas.The 52-year-old firm already has twoproduction units in Luanda and one inLobito where it makes electrodes. A newgas production plant in Lubango suppliesthe Coca-Cola bottling factory there.

Angases general manager Julio de MeloAraujo says more foreign businesses,mainly in petroleum production and

exploration, are turning to Angasesinstead of importing gas. “It is better for them to work with us because thetransport costs are lower – therefore theprice is lower – so there is no point inimporting gas from abroad,” he adds.

On average the firm makes $300,000 amonth, but Mr Araujo expects this figureto rise. “The real changes will be in 2002because we are currently investing signif-icantly,” he says. “Next year we will beproducing new products.”

There are plans to install another unitfor the production of carbon dioxide inLubango and several other projects areon the drawing board.

Much of this will be as a result ofgreater oil exploration and developmentin the petroleum sector. Angases is ham-pered by power failures and water short-ages in Angola – contaminated watercannot be used in the gas-making process.This has been partially overcome by stor-ing clean water in huge cisterns.

“The industrial sector in Angola is verydifferent from how it was in the past,”says Mr Araujo. “There is a need toresurrect paralysed firms with no finan-cial capacity so that they can improveby themselves. Today, about 90 per centof Angolan industries are paralysed,although we are operational.” ■

Lisbon BranchAv. Eng. Duarte Pacheco,Torre 1, 13? Lado 1,1000 Lisbon, Portugal.Tel: 351-1-381-51-30 Fax: 351-1-381-51-49

LuandaRua Rainha Ginga, no. 6, 2, Luanda, Angola..Tel: 244-2-396579 Fax: 244-2-391819www.escom.pt

Escom, part of the Grupo Espírito Santo, deals in international commerce and services in developingcountries. In the area of international commerce, Escom specialises in the following services:

• Imports and exports• Procurement• Documentary credit• Logistics• Trade financing

An important investment that Escom has made in Angola has resulted in the joint venture withAngolan partners from which AMDL (African Markets Development Ltd.) was founded.AMDLdirects all the projects in this market’s sectors, including food industry and distribution, mineralextraction, public works and civil construction, fishing and transportation.

• Basic sanitation• Health services management• Education services management• Setting up and promoting consortiums• Strategic partnerships

the future, after which activities will be further expanded

battle diseaseCoimbra Adao Manuel, president and

general manager of state-owned drugsproducer and distributor Angomedica,says that, because of the dislocationcaused by the civil war, there are noreliable statistics on Aids infection.

Angomedica, which supplieschloroquine for malaria, as well asantibiotics and other drugs, isdesperately underfunded. Mr Manuelsays the company is working at only 20 per cent of capacity. “To get out ofthis difficult situation, we need greatinvestment from the state because weneed to modernise the firm,” he says.

“The second choice is to allowforeign participation in Angomedica.We would like to have a partner withknow-how and financial resources.”

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An Angolan province of exceptional potential, Uíge is now look-ing to further diversify its economy by taking advantage of itsstrategically ideal location, bountiful natural resources andactive population. Located in northwestern Angola, Uíge’s geo-graphical diversity accounts for its range of economic activity.From coffee to timber, diamonds to lead, the province aboundsin investment potential, especially in the agrobusiness and foodtransformation sectors. Uíge’s coffee output, above all, hasproved the backbone of Angolan agriculture since the 1950sbut the province’s mining and agricultural riches are yet to be fully exploited, while industry (fridge production and lid bottling) is transforming Uíge’s economic landscape. Further-more, thanks to the genuine warmth and hospitality of its population, Uíge has proved a welcome home for investors withthe vision to share in the province’s future aspirations.

GOVERNO DA PROVINCIA DO UÍGE Rua Bembe Casa Nº10, Bairro pop. Nº1, Uíge, Republic of Angola. Tel: +244 22 109 Fax: +244 20 218


With 2,500 schools destroyedduring the civil war, up to twomillion children out of schooland a desperate shortage of

teachers, Angola’s education system isfacing some daunting challenges.

There are 2,000 public and 250 privateschools in Angola, serving a populationof 12 million. To improve the system,education and culture minister AntonioBurity da Silva Neto recently estimatedthat the government needed $500 millionfor the current school year.

Education is a priority for the Eduardodos Santos Foundation (Fesa), a non-governmental organisation set up fiveyears ago. Its aim, according to its presi-dent, Ismael Diogo da Silva, is to lendsupport “in matters that the governmentalone cannot resolve”.

Since its creation, the organisationhas disbursed $30 million, two-thirds ofwhich has gone into education. Fesaobtains money from large companies,each of whom pay $100,000 a year to siton its board of trustees. BP is one donorfirm, and others include foreign non-governmental organisations in China,Japan and the US.

“Our objective is to support the mostvulnerable communities – those left out

of the normal education system,” says Dr da Silva. “The war destroyed manyschools in the country, mainly in theinterior where there are many problems,and about two million children are outof the education system.”

This problem is compounded by anacute shortage of materials for pupils –

even chairs have to be imported becauselocal production is limited and dependson timber from the Angolan enclave ofCabinda, which is accessible only by airor a riverboat crossing.

Nevertheless, one important changehas come about thanks to Fesa’s efforts.“The mentality of the population haschanged and parents recognise that their

children have to go to school so they canlearn to read and write,” says Dr da Silva.

The stress on education is beingreinforced by other relatively simpleprojects to inspire parents to send theirchildren to school. Fesa provides sewingmachines and textiles to cooperatives tomake school uniforms, while a commu-nity development programme directs theconstruction of school buildings andsupplies some of the materials.

“I have travelled to many provincesand seen the very great interest amongparents who want their children to go toschool,” says Dr da Silva. “Even in ourfurthermost province, Kuando Kubango,I went to a school where 200 pupils arelearning French. A new wave of interestin culture and education is sweepingthrough the nation.”

The foundation has also providedmoney for the rehabilitation of markets,the restoration of a colonial church, asports stadium, health clinics, policevehicles, wheelchairs for amputees andgenerators for hospitals. It promotes

DA SILVA

‘Parents now recognisethat their children haveto go to school’

The Eduardo dos Santos Foundation, set up five years ago,

works to improve living conditions for poor communities

Learning curve: with only 2,000 public and 250 private in

Simple projects aim to bring educat i

POWERInstalled power 520 MWKWANZA RIVERMaximum flow observed3740 m3/sMinimum flow observed125 m3/sCONCRETE DAM (CCR)Total Length 1200 mMaximum Height 110 mRESERVOIRVolume 3700 hm3

Unveiling - December2002PHASE 12 Units, 260 MWPHASE 22 Units, 260 MW

FEATURESProduction of electricenergyStandardisation of theflow of the MiddleKwanza (500m3/s)IrrigationIndustrial Development

GABINETE DEAPROVEITAMENTODO MÉDIO KWANZACaixa Postal 6184 Luanda, AngolaTel: (+2442) 445-000 Fax: (+2442) 447-973

❑ Angola is rich in land and used to be self-sufficient before gainingindependence. With 85 per cent of the working population employed on the land, the government hasembarked on a long-term drive to boost agricultural output.

Agriculture minister Gilberto ButaLutucuta “First, we have to organise the population so that they can formcooperative associations and then wemust boost production. Even before webegin to increase agricultural productionwe have to provide the population withseeds, fertilisers, tractors and a systemof long-term credit.”

The challenge facing Angola’s farmersand the government is exacerbated bythe fact that more than two millionpeople have been displaced by conflict.Something like a fifth of the entirepopulation is homeless and depends onfood aid. “We will give free supplies tothe refugees so that they can start a new life,” says Mr Lutucuta.

The authorities aim to provide farmerswith technical support. Angola was oncethe third-largest coffee exporter, but thesector went into sharp decline after thewar broke out. “We are committed todeveloping coffee production in thecentral provinces,” says the minister.

The government would also like theprivate sector to put more money into

livestock farming. “We are trying toattract more investment to this areathrough incentives,” he says. “We needinvestment in the livestock sector insouthern Angola where we have largeareas of land waiting to be exploited.”

One such investor is Tecnocarro. It started out supplying tyres in 1982and has since diversified into foodproduction. “We have invested inagriculture, fisheries and livestockbecause they are necessary for ourpeople,” says administrator Jose CarlosRecio. “We have invested a lot of moneyin the livestock business in the south

Grass roots: the first step is to organise the people into c

EDUCATION


Helping the farmers to help t


EDUCATION

AIDS awareness and land mine clearance,sponsors dancing and physical fitness pro-grammes, and provides toys for childrenin very poor families. Currently, Fesa isrunning campaigns to combat diseasessuch as malaria, sleeping sickness, leprosyand tuberculosis, all prevalent in Angola.

Fesa also supports the nation’s youngfootballers. Although the sport has a hugefollowing in Angola, players’ techniquesleft a little to be desired, so PresidentJose Eduardo dos Santos founded a foot-ball school “because he was concernedabout the bad quality of Angolan foot-ball”, explains Dr da Silva. The firstpupils were street children.

The school is supported by Fesa now,and about 370 young footballers aged between six and 21 take part in trainingsessions. The Fesa teams have playedabroad several times and returned homewith honours, including the Africanunder-20s championship. “We alreadyhave a basis for a good future Olympicteam,” says Dr da Silva.

The foundation is also engaged inhousing programmes, particularly inViana, the biggest municipality inLuanda, where several thousand homesare to be built. So far, about $16 millionhas been spent on land in Luanda forfuture development. ■

te institutions serving a population of 12 million, funding is urgently required to provide new facilities

t ion to all classes

Angases is Angola’s foremost producer of industrial and medicinal gases. As the exclusive supplier of gas

to Coca-Cola Angola, we are always on the lookout for partnerships with petroleum and food

transportation companies.Angases offers a wide

range of products, including:

• Liquid and Gas Oxygen (Medicinal

and Industrial)• Acetylene

• Nitrogen• Anaesthetic Gas

• Arc-Weld Electrodes• Carbon Dioxide• Compressed Air

• Argon, Helium, Hydrogen, Corgon 20/80

• Solders, Accessories, Fire Material, Hospital

and Surgery Equipment

AngasesCaixa Postal 1040-1088, Luanda, AngolaTel: (+244 2) 84 02 39 / 31 05 05 Fax: (+244 2) 84 03 35 / 31 00 99

of the country, where our project is thethird largest in the region.”

The company has 2.7 million head ofcattle and Mr Recio is starting to targetoverseas markets. “This is a greatopportunity for Angola to produce meat

for export. It is not easy to compete withcountries like Brazil, Argentina andEngland because they have moreexperience, better technology andconditions,” he says.

“But we have been helped by theoutbreak of foot-and-mouth and BSE inEurope. Our cattle is raised 24 hours aday outside, eating only grass. Peoplehave lost confidence in European meat.Angola will surely export meat to Europein the near future.”

The country’s historical links withPortugal have not faded away entirely.Escom, a Grupo Espirito Santo company,has been an active player in Angolasince the beginning of the last century.

The firm has become involved inseveral water-sanitation projects duringthe last few years and is achieving agrowing presence in food retail. “Therewill be more investments in this area,and we will develop more,” says Escomadministrator Helder Bataglia.

“Our main concern is the distributionof goods in the north, centre and southof the country. If we don’t make thisdistribution, we are achieving nothingbecause what people need most is food.”

Escom’s fisheries operations areconcentrated in Namibe, where theyhave become a crucial element of thelocal economy. “We have reconstructedone of the most important fish-basedindustries there, which I am sure willcontribute a lot to the development ofNamibe province,” says Mr Bataglia.

to cooperative associations and then boost production

RECIO

‘Angola will surelyexport meat to Europein the near future’

Life force: working to supply clean water to improve hygiene and help to combat disease


p themselves

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Banco de Comércio e Indústria (BCI)

is Angola’s leading bank. Currently state-owned (91%

of shares are owned directly by the state and the remainder

is divided among state-owned companies) but soon to be

privatised, BCI is preparing for privatisation by developing

specialised corporate banking services and catering to the

business community. With offices in ten provinces and

counting, we are expanding both our branch network and

our investment profile, as well as increasing participation

in profitable companies, diversifying our interests and

moving into new fields such as real estate and private

sector development.

BCI is proud to be building new headquarters in the

centre of Luanda which will accurately reflect our modern

image and approach. From online banking services to

electronic payment methods, we offer our clients the

best of today and tomorrow.

As 60% of our commercial activity is centred on the

import-export business, it is no surprise that BCI is

thoroughly international in its outlook. We maintain

excellent relations with foreign institutions such as HSBC

and Citibank and are eager to develop closer ties with UK

banks. At BCI we believe that we have a crucial role to play

in Angola’s development and we invite international

investors to participate in present and future opportunities.

BCI - Banco de Comércio e IndústriaAvenida 4 de Fevereiro 86, Caixa Postal 1395, Tel: (+2442) 33 36 84 / 33 14 98, Fax: (+2442) 33 38 23

Luanda, Angola


Tourism agencies are unlikely tomention Angola as a holidaydestination and no amount ofhyperbole is going to alter the

current view that danger and difficultiescontinue to linger in this poverty strickenAfrican nation.

Yet there are signs that, as a fragilepeace returns to the country, attempts toattract visitors are paying off. The coun-try now has 100 travel agents, up fromjust two in 1982.

Hotels and tourism vice-ministerPaulino Baptista says that 50,000 for-eigners have visited Angola in the pastyear, generating $7.2 million in revenue.

According to Mr Baptista most visitorshave been from former colonial rulerPortugal, as well as from Brazil, France,Britain and the US. Tourism is limitedmainly to the capital, Luanda, and ahandful of resorts along the coast.

Efforts are being made to renovateLuanda’s remaining colonial buildingsand the palm tree-fringed promenadeswhich drew visitors before the outbreakof war in 1975. Upmarket beach resorts

line the city’s peninsula, called the Ilha,and hotels are being spruced up.

Many destinations in the country areaccessible only by air; others are reachedonly after hours driving over bone-jarringdirt tracks which become impassable inthe rainy season. It is simply not possibleto walk into your local travel agent andbook a fortnight’s package holiday toAngola with a guarantee that everywhere

you stay will have air-conditioning, hotand cold running water, a choice of menuand international dialling.

Common sense and patience are a pre-requisite for all visitors. A visit to Angolacannot be compared with one to Kenya,South Africa, Tanzania and other Africanstates where tourism facilities are farmore advanced. Yet there is much to dis-cover, scenically and culturally.

Angolan writer and dramatist JoseMena Abrantes says: “Angola is experi-encing a fresh start in the developmentof all cultural sectors. But we recognise

that there is still much to be done andmuch to achieve.”

Mr Abrantes, media adviser to thepresident, was among a number of lead-ing intellectuals and politicians whopushed for the creation of a nationalprize for arts and culture, now in itssecond year. Each prize in five separatecategories is worth $30,000, a colossalsum of money for any Angolan. “There isno ceremony in Angola that is not accom-panied by music or dance,” he adds.

Some investment is now being madein tourism projects. A few institutions,even though their budgets are very lim-ited, are making firm efforts to establishpolicies and drive up standards.

Omar Silva Karim, president of theKissama Foundation, says tourism is stillembryonic. The foundation is the admin-istrator of Kissama national park, and isinvolved in education and social welfareprogrammes throughout the country.

“Tourism is just starting in Angola andthere is a great deal to do,” he says.

“During 26 years of war it was almostimpossible to attract tourists to Angolaand therefore no tourism industry wasdeveloped. But the situation is changing.”

For example, he points out: “This year,the provinces of Luanda and Kwanza Sul,some private operators, hoteliers, travelagencies and the Kissama Foundation got together to promote tourism in thecountry for the solar eclipse.”

Kissama, 50 miles south of Luanda, isone of 11 national parks in Angola. Yearsof illegal hunting have reduced thenumber of elephants and rhinoceros, butthe foundation is re-introducing species.It has also beefed up anti-poachingpatrols, although this is not easy over anarea of one million hectares with limitedresources.

“We are trying to get as much invest-ment as possible to promote tourism inthe area,” adds Dr Karim.

With the government giving the 18provinces greater freedom to pursueprogrammes of economic regeneration,more of the country is being opened upto tourism. The southern province ofNamibe, with its unique plant life andextraordinary desert rock formations, isone of the most accessible.

Angola is one of the 14 member statesof the Southern African DevelopmentCommunity (SADC), which is reinforc-ing its cooperation in the tourism sector.Earlier this year, the SADC-affiliatedRegional Tourism Organisation ofSouthern Africa agreed to a five-yearstrategy to develop sustainable tourism.One item on the agenda was a proposedsystem allowing tourists to visit all theSADC countries on a single visa. ■


TOURISM

Rua do 1 Congreso do MPLA, 26 - 2nd Andar, C.P. 625, Luanda, Angola Tel: (+244) 2 397517, Fax: (+244) 2 391688, E-mail:[email protected]

www.angolatelecom.com

At Angola Telecom, we believe in the power of communication. With 90% of our fixed-line network digitalised, we are currently expanding our nationwide mobile

system to meet growing consumer demand for state-of-the-art services.Angola Telecom is also looking forward to the imminent completion of SAT3,

an ambitious fiber-optic link project that will unite Africa and Europe. With privatisation on the horizon, we invite foreign investors to join

Angola Telecom in this promising new stage of development.

As a fragile peacereturns, efforts toattract visitors arestarting to pay off

ABRANTES

‘This is a fresh start forthe development ofall cultural sectors’

New work is being done to

restore the capital’s former

colonial attractions and

develop its wildlife parks

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As Angola’s top diamond-producing province, Lunda Norte’s potential shines theworld over. Welcoming foreign investors from all over the globe, Lunda Norte not

only shows great potential in the diamond industry, but also in agriculture, hydroelectricpower and civil construction. Boasting fertile lands and a tropical climate, the provinceoffers opportunities in the cultivation of rice, corn, cassava palms and bananas. With for-eign investment, the goal of the agricultural sector is to go beyond self-sufficiency andexpand into export-oriented production. The hydroelectric plant at Dundo is currentlycapable of producing 6 MW of power. The provincial government of Lunda Norte is alsolooking closely at the social aspect of the province and has recently launched a vast program to construct new houses and modernize existing infrastructure. The priority ofthis new project is on education and training. A new library is already in the works andnew sports facilities have already been built.

Provincial Government of Lunda Norte, Dundo, Lunda NorteTel: 244-396-319

www.ebonet.net/gov.lundanorteE-mail: [email protected]

Working together to make Lunda Norte as polished as a diamond


Whatever you may have heard, beauty’s never only skin deep. In the case of Angola’s coastal province of Namibe, an ultra-modern infrastructure net-work has enabled investors and tourists alike to share in the province’s many treasures. A state-of-the-art international airport, a railway system linking theprovince to eastern Angola and a harbour capable of mooring ships of up to 150,000 tons are examples of Namibe’s economic potential. Further effortsare being channelled into diversifying Namibe’s commercial vocation, taking advantage not only of its unsurpassed natural resources, but also of its strate-gic location as the gateway to the southwestern Africa. These include developing the already vibrant agriculture and fishing industries (Namibe is Angola’stop agricultural producer and accounts for 65% of Angola’s fish production) while looking to areas such asmining – the province is rich in diamonds, mica, marble, granite and gypsum amongst others. What’s more,its location on the west African coast provides Namibe with an excellent climate that, combined with the mileupon mile of uncrowded beaches and the ecotourism paradise of IONA National Park, makes for prime oppor-tunities for tourism development. It is little wonder that in such a setting peace has prevailed.Namibe: catch the wave while you can.

PROVINCIA DE NAMIBENamibe , Angola , Te l : +244 64 600 63 Fax: +244 2 39 62 90 E-mai l : governo.namibe@netangola .com

This supplement was produced by World Report Limited Inc, who are solely responsible for the content


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