Angola is recovering nicely after years of conflict. Its priority economic sectors include agriculture, construction and infrastructure, power generation, water, sanitation, mining, oil and gas, social housing and tourism.
The country’s post-conflict reconstruction needs are vast, a situation that should be harnessed by developed nations such as Canada. It has needs in all of the sectors listed above, and, when it comes to infrastructure, Angola’s specific requirements include engineering, railway rehabilitation and highway construction. Angola also needs help in manufacturing and obtaining equipment to facilitate electric power operations and services, as well as those for oil and gas.
The oil sector remains the cornerstone of our economy, contributing 45 percent of GDP and 90 percent of foreign exchange earnings. Angola is Africa’s second-largest oil producer, with an output of between 1.5 million and 1.9 million barrels per day over the past few years. The Angolan government has used those revenues and resources to stabilise the economy and reduce inflation.
Angola is part of the Southern Africa Development Community (SADC), a regional economic grouping that seeks to promote socio-economic co-operation and integration as well as political and security co-operation among 15 southern African states. The SADC’s mission complements the role of the African Union.
As mentioned, the Angolan economy is highly concentrated on extractive industries, predominantly oil and gas, but also mining (specifically, diamonds). Diamond production is likely to grow by 25 percent this year, to exceed 10 million carats, thanks to two new exploration projects.
As outlined in the National Plan of Geology (Planageo), Angola hopes to attract investment and sustainable exploration of its mining resources over the next century.
Angola also seeks to invest heavily in the development of the country, particularly with respect to infrastructure development, power generation, agricultural development and mining. Several Canadian companies have shown interest in Angola on projects in such sectors as energy, water, health, education, agriculture, fisheries, transportation, information and communications technology (ICT).
Diplomatic relations between Canada and Angola were established in 1978 and have grown steadily since the end of the Angola’s civil war in 2002. Canada’s embassy for Angola is based in Zimbabwe, and it has a consulate in Luanda, headed by an honorary consul.
To ensure Canada is well positioned to participate in Angola’s economic development, a dedicated trade presence has also been established through the Canada Trade Office in Johannesburg, South Africa. Angola, meanwhile, has had a resident embassy in Ottawa since 1997.
With Angola’s assurance of sustainable peace and a democratic environment, Canada has focused on trade, particularly in the extractive industries sector. But Angola is also experiencing rapid economic growth with opportunities for bilateral engagement, including trade and investment, emerging in this dynamic market. In 2004, the two governments signed a joint declaration of intent on strengthened bilateral relations to enhance trade and investment ties and to strengthen political dialogue and co-operation in good governance and public-sector capacity building.
When it comes to raw numbers, two-way merchandise trade fell slightly to $1.63 billion in 2013, consisting of $80 million in Canadian exports to Angola, and $1.55 billion in Angolan imports to Canada.
Canada exports mainly vegetables, textiles and meat to Angola while the bulk of Angola’s exports to Canada — accounting for a full $1.5 billion — were fuels and oils. Other items Canada imported included stone, plaster and cement products.
To boost the commercial ties between both countries, Canada proposed in 2010 that the two countries sign a Foreign Investment Protection Agreement (FIPA). That option is currently under review by the Angolan government.
Some Canadian companies are already investing in Angola. SNC-Lavalin is currently completing the rehabilitation of the existing spillway and road-bridge of the Matala Dam, in Angola’s Huila province. The project started in 2011 and is scheduled to be completed in early 2015. It employs 400 Angolan citizens — making up 65 percent of the project’s workforce — and is expected to cost $277 million at completion.
With an attractive market of 20.9 million consumers, Angola will continue to grow over the next 15 to 20 years. It is a market Canadian entrepreneurs should consider.
Agostinho Tavares da Silva Neto is ambassador of Angola. Reach him at Agostinho.tavares@embangola-can.org or (613) 234-1152.
