How Angolans can do business with Portugal
ANALYSIS. With almost 90% of votes contacted, victory is still open. We went to hear the opinion of experts on impact for companies and which sectors will be most connected to Angola
Angola went to vote this Wednesday. The approximately whoever decides in the next14, such as the next composition of the National Assembly, will be 3 million of our composition for the next decision of the National Assembly.
The provisional results of the advantage to the current head of state, João Lourenço, but UNITA, of Adalberto Costa Júnior, also claim victory. If the latter makes it, it will be the first time that Jonas Savimbi’s party manages to elect the president, and represents the loss of power the MPLA has maintained since the MPLA’s conquest of power.
A radical change that could happen, Carlos Bayan Ferreira, the second economist with “some instability”. “I believe that there are sectors of the MPLA that do not easily accept this new situation. And there are also sectors of UNITA that have excessive power. It shouldn’t be like that. If UNITA is intelligent, it will not enter with a vengeance, it will opt for a calm transition. The economic part is very important for any political issue. As much as politicians want it, if the economic part doesn’t move, they won’t get anything either. Therefore, UNITA would have every interest in the transition to take place as smoothly as possible”, he explains to CNN Portugal, also referring to other risks for Portuguese investment.
“There are Portuguese investors who have Angolan partners, and changing partners sometimes causes their disturbances. The government’s own goals may change.”emphasis.
Despite these factors, the economist highlights Costa Júnior’s strong connection to Portugal, given that the political leader “lived here for many years” and even had Portuguese nationality, and the fact that the atmosphere between the MPLA and UNITA was more peaceful than lived throughout the history of independent Angola. “I hope that both sides recognize that democratic alternation is a keynote of countries’ growth. Now there is stability. The Armed Forces are stabilized, they don’t get involved in politics as in the past. Previously, there were the armed forces of the MPLA and those of UNITA. Now, the best best of nationals, which are Africa”, he considers.
In the interview with CNN Portugal, the leader of UNITA, after being asked about the risks of violence, rejected this possibility, stating that “the party certainly has violence”.
Carlos Bayan Ferreira also emphasizes the “good experience” of Portuguese businessmen during the MPLA governments, who “always cherished foreign direct investment, mainly Portuguese”, an environment that predicts that the opposition will remain in power. “In this hypothetical scenario, which I do not believe will materialise, note that Portuguese entrepreneurs will continue to invest in Angola because they know the country and its characteristics. There is no foreigner who knows Angola better than the Portuguese. There isn’t, all over the world. This can be seen in the experiences of Spanish, German and French women. It is our added value”, he emphasizes.
“Those who live there continue to live, and those who invest there continue to invest. The objective of Portuguese businessmen is Angola, not this or that party. Portuguese entrepreneurs see him as a friend, with enormous potential for the investing country, regardless of the difficulties the country is currently experiencing”, says the economist.
And what would Angolan investments in Portugal look like? Bayan Ferreira points in the same direction, and highlights the important role that Angolan investment, whether the public, through companies such as Sonangol, or the private, played during the height of the crisis in Portugal. “Angolan investment in Portugal in Portugal was very important for our economy. People immediately think of Portuguese and money laundering, which happened, but this investment was vital at the time during the crisis. I’m thinking that, after going through a deep crisis, the Angolan, investing abroad, feels better investing in Portugal, he will do it”, perspective.
The eighth largest customer in Portugal
Ricardo Ferraz, researcher at ISEG and professor at Universidade Lusófona, has a similar opinion. Emphasizing Portugal and Angola that economic relations are more intense”, and that the cause for the weakening lies in the southern crossing, or economists do not believe that a change cannot be financially economic”.
“We have a party [MPLA] in power since 1975, it is natural that there are people who feel tempted to other partisans. However, it seems unlikely to me that UNITA will win. Even if it is significant for Portugal and for the economic level, it does not seem to me to be significant. It doesn’t seem to me that exports will decrease or increase if UNITA will win, nor that more or less foreign investment from Portugal will go into Angola”, he considers, also stressing that, despite exports to Angola following a negative trend, the country continues to be the eighth largest customer in Portugal.
“In my opinion, there will be no great turmoil. I don’t see UNITA with a very nationalist speech and against Portugal. They are friends, they share the same language, they have a common history”, he reinforces to CNN Portugal.
For Ricardo Ferraz, the important thing for Angola is to develop its economy. “Angola should set a higher growth path for its own. If we look at the economic data from the World Bank, Angola against all economic economic years between 2016 and 2020. Despite its potential, it has a GDP per capita at power parity of relatively low, even lower than that of Cape Verde and Bangladesh”, he analyzes. “I don’t know if UNITA can define this path.”
Angolan investment in Portugal has been higher than Portuguese investment in Angola
Angolan investment in Portugal was, in June 2021, higher than Portuguese investment in Angola by 241 million euros, according to data from the Bank of Portugal, sent to Lusa by AICEP.
According to the data, Angola’s Foreign Direct Investment in Portugal (IDE) amounted, in June this year, to 2,214 million euros, compared to 1,973 million euros of Portuguese Direct Investment Abroad (IDPE) in Angolan territory registered in the same month. .
FDI has remained more or less stable since 2017, which in December 2019 totaled 2.249 million euros and a year later stood at 2.176 million euros. The IDPE, on the other hand, has registered a notable drop in recent years. In December 2017 it amounted to 4,547 million euros and in 2020 it had already dropped to 1,944 million euros.
The most important economic relations between the two countries are seen in the following sectors:
Bank
The 1990s marked the entry of Portuguese banks into Angola with the normalization of the country’s financial system, after the post-independence nationalizations (1975).
Of the majorities that coincide, the Angolan sector concentrates the market’s bank. Of these, two capitals of Portuguese origin: Banco de Fomento Angola (BFA), of which BPI is a shareholder, and Banco Económico, formerly Banco Espírito Santo Angola (BESA), of the Espírito Santo group, which ended up being dragged into the collapse make group. Novo Banco maintains a position in this Angolan institution, which is dominated by Sonangol.
BCP is also in the country, through Banco Millennium Angola (BMA) and Caixa Geral de Depósitos, at Banco Caixa Geral, where it even had a partnership with Santander Totta, which sold its position in 2015. Montepio is also present in this African nation, through a 51% stake in Finibanco Angola.
Angola’s presence in Portuguese banking is more recent and has undergone many changes in recent years, after Luanda Leaks.
In 2008, Sonangol acquired 9.99% of the capital of BCP and, in 2009, it was the turn of the Santoro holding company (by Isabel dos Santos) to enter BPI, acquiring 9.67% of the bank’s capital from BCP. Sonangol is currently the second largest shareholder of BCP, with 19.49%.
At BPI, Santoro sold its stake in CaixaBank’s OPA (Public Offer for Acquisition) in 2017. In turn, BIC Portugal bought BPN for 40 million euros from the Portuguese State, but, after Luanda Leaks, BIC Portugal The institution (now EuroBic) announced that the businesswoman Isabel dos Santos would abandon the shareholder structure of the Portuguese financial bank, a measure to “safeguard confidence in the institution”, according to the financial entity.
However, this sale has not yet advanced and for now the latest update from Santoro Financial Holding (17.5%) (25%), the latest information available at the bank place of the bank, and the participation is locked up.
energy and industry
Esperaza holding company, a consortium in which Sonangol holds 60% of the shares and Exem (by Isabel dos Santos) holds the remaining 40%, controls 45% of Amorim Energia which, in turn, is a key shareholder in Galp. However, the Angolan oil company announced in July 2021 that it had been declared the only time for the investment made in Galp, according to the final sentence of a Dutch court that arbitrated the dispute between the oil company and Exem, which, by its state-owned company, appealed of the decision.
The Portuguese oil company’s relationship with Angola dates back to 1982, dedicating itself to the activity of oil production and exploration.
In the industrial area, with connections to energy, Isabel dos Santos’ position at Efacec was, until the past, the majority, but ended up being nationalized by the Government after the businesswoman left, due to Luanda Leaks. It is now in the process of reprivatisation.
construction
The most emblematic presence of Portuguese companies in Angola belongs to Mota-Engil. The one led by António Mota and Gonçalo Moura has been in the country since its foundation in 146, but has been following it9 and its company will diversify in recent years, following the economy of that market.
Mota-Engil Angola, a subsidiary created in 2010 by the group for this country, has shareholders such as Sonangol (20%), and the Angolan State plans to sell this position.
Teixeira Duarte is another of the Portuguese construction companies that are present in the Angolan market. The difficulties of companies such as Soares da Costa, historically with a large presence in Angola, dictated the reduction of Portuguese interests in the Angolan market, in this sector.