Opinion
Angola’s lessons from Brazil
Others question this: “I don’t believe that – even if Angola has the capacity to double production. If you continue to produce 22.3m barrels per day (bpd) instead of 4m bpd, you allow your country to produce oil for 60 more years,” says one oil company executive based in Luanda.” Instead, he sees more modest increases in production in the medium term.
Oiling the succession
Oil remains critical, which helps explain why the former chief of Sonangol and current vicepresident Manuel Vicente is being groomed to take over from Dos Santos. Some politicians are uneasy about the ascendancy of a mainly technocratic figure. Others ask how they could benefit as national capitalists from a diversified economy.
It would mean moving towards productive investment and restricting the businesspeople who make their money from trading oil, over priced procurement contracts and as monopoly suppliers to the state. Businessmen remain skeptical about radical policy shifts: “I’m not expect ing to see big increases in local and value added production, mainly because of the cost of labor, land, energy and the rental of space – but also in terms of corruption and the indirect costs that you have to battle with,” a foreign business executive in Luanda explains.
With oil production and prices stay ing strong and revenue boosted by new liquefied natural gas exports, Angola’s rulers may think they can postpone some hard decisions. But with changing global economics trends and the shale gas revolution, Angola could lose its oil advantage while local economic troubles build up.
Add that to the widespread anger about social conditions and the country’s postwar compact could start facing real political pressure from the frustrated younger generation.
Copyright The Africa Report 2014
