Angola Enters a New Political Era With Its Economy Struggling

Updated on
  • Ruling-party candidate Lourenco expected to win Aug. 23 vote
  • Angola grapples with economic crisis after oil prices dropped

Around the horseshoe-shaped bay of Luanda, Angola’s capital, unfinished skyscrapers stand as a testament to the challenges facing Africa’s second-biggest oil producer as it prepares for its first leadership change in almost four decades.

Before the oil slump, hundreds of container ships waited near the palm-tree lined waterfront to offload their goods at the port. Today, only a handful of vessels are visible. In the suburbs, gated communities built for foreign workers and a middle class that never emerged are practically empty.

A local youth sits on the shoreline looking out towards the Bay of Luanda.

Photographer: Simon Dawson/Bloomberg

“Where did all the ships go?” said Matias Joaquim, who owns a small restaurant in the Sambizanga slum, a maze of huts on a hill overlooking the port of Luanda. “If the rich are already not doing well, imagine the poor.”

Economic Downturn

Angola will hold elections on Wednesday as President Jose Eduardo dos Santos, 74, prepares to step down after 38 years in power. His successor, almost certainly from the same party, will face the challenge of reversing the worst downturn since the country emerged from civil war in 2002. While Dos Santos’s departure marks a new era in Angolan politics, the change in leadership won’t necessarily ease the economic crisis, according to Manuel Alves da Rocha, chief economist at the Catholic University of Angola in Luanda.

“Changing the president may have seemed unthinkable a few years ago,” Alves da Rocha said in an interview. “The hard part after the vote is to fix an economy that continues to run on oil.”

Dos Santos is credited for transforming Angola into a key oil producer and overseeing glitzy infrastructure projects. At the same time, some of his family members accumulated fortunes while a third of the population still lives on less than $2 a day, according to the World Bank. His eldest daughter, Isabel, is Africa’s richest woman, with an estimated wealth of $2.3 billion, according to the Bloomberg Billionaires Index.

Read QuickTake on what’s at stake in the election

The Popular Movement for the Liberation of Angola, or MPLA, which has ruled the southern African nation since independence from Portugal in 1975, picked Defense Minister Joao Lourenco as its presidential candidate. Its faces an underfunded and divided opposition that includes the former rebel group, the National Union for the Total Independence of Angola, or Unita, and the Broad Convergence for the Salvation of Angola–Electoral Coalition party, or Casa-CE.

Jose Eduardo dos Santos and Joao Lourenco

Photographer: Marco Longari/AFP via Getty Images

“The MPLA will win the elections,” said Alex Vines, head of the Africa program at the London-based policy center Chatham House. “The question will be the size of the majority.”

Dos Santos, who will remain MPLA chairman until at least 2018, will probably continue to wield influence even after he steps down, according to Isaias Samakuva, the 71-year-old head of Unita, which abandoned its armed struggle in 2002. Unita has threatened to hold street protests if it considers the election unfair, but rejected a return to armed conflict.

Chinese Workers

During the boom times, Chinese and Portuguese workers flocked to the country to earn money in construction as the government launched a flurry of projects, from highways to satellite towns. But after expanding for 14 consecutive years, the economy posted zero growth in 2016, prompting tens of thousands of Chinese to leave, according to the Angola-China Industrial and Commerce Association. Portuguese workers also abandoned the country by the thousands, according to Portugal’s Construction Sector Union.

Those who’ve remained are grappling with an inflation rate of 30 percent and a shortage of dollars needed to import products.

“In the past, investors thought they could land in Angola, shake a tree and collect the profits,” Antonio Cunha, owner of 7 Cunhas, a conglomerate of companies ranging from construction firms to restaurants, said in an interview. “That wasn’t normal. What’s happening today is the normalization of the economy.”

During his campaign, Lourenco, 63, pledged to fight corruption, diversify the economy and attract foreign investment. He has also called on Angolans abroad to invest their money back home.

Despite the economic crisis, Dos Santos earlier this month presided over the groundbreaking ceremony for a new dam in the Cuanza Norte province, east of Luanda.

“A few years ago, the president used to appear when big projects like bridges and railway lines were complete,” said Sebastiao Toco, a civil engineer, who lives in Luanda. “Now, he just cuts the sod for a new project and hopes Angola will be able to pay for it one day.”

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