Tag Archives: Angola

18 Jan

Lourenco Proves He’s No One’s Puppet in Angola

Shortly after becoming president of Angola in September, Joao Lourenco did something completely unexpected: he stopped at a red light.

The incident prompted thousands of social-media users to praise the 63-year-old former army general for abiding by the law.

In October, Lourenco waited in line at a KFC restaurant to buy a burger, and then this month, photos surfaced of him and his wife Ana Dias strolling on a beach in the capital, Luanda.

Few predicted the sharp contrast in leadership style with his predecessor, Jose Eduardo dos Santos, who rarely left the pink presidential palace from where he ruled Africa’s second-biggest oil producer for almost four decades.

When he did emerge, hundreds of soldiers swarmed the city center to allow his convoy to move swiftly through the pot-holed streets, leaving traffic paralyzed for hours.

“He’s been a very positive surprise,” said Soren Kirk Jensen, an independent Angola expert. “There’s been a profound change of style, from a completely closed style to a completely open one.

More importantly, he’s initiated much-needed economic reforms by addressing dysfunctionalities in the way the market works due to unnatural monopolies that happened to be controlled by certain families.”

When Lourenco won nomination as the candidate of the ruling Popular Movement for the Liberation of Angola last year, analysts discounted a policy shift, saying his power would be limited by the party and the Dos Santos family and its allies.

Lourenco’s decision to reappoint 13 out of 18 provincial governors he had inherited from Dos Santos just two days into his new job seemed to confirm that suspicion.

Corruption Fight

But in a state of the union speech on Oct. 16, Lourenco stressed that he was serious about campaign promises to fight corruption and end state-run monopolies in a country that ranks among the world’s 20 most corrupt, according to Berlin-based Transparency International.

The first high-profile official to be removed was central bank Governor Valter Filipe, a lawyer Dos Santos appointed the previous year.

To read the full article, click here.

08 Jan

Angola Is Said to Plan Currency Sale Tuesday as It Ends Peg

Angola’s central bank will hold an auction on Tuesday to sell foreign currency to commercial banks, its first since saying it will abandon a dollar peg, according to three people familiar with knowledge of the matter.

The kwanza will probably be allowed to depreciate at the auction as the central bank shifts to a trading band, the people said, asking not to be identified because they aren’t authorized to speak publicly on the matter. About $100 million of foreign currency will be offered at the auction, one person added.

Angola, Africa’s second-largest oil producer, will join a long list of commodity exporters — from Russia to Egypt, Kazakhstan, Nigeria and Uzbekistan — that have floated or devalued currencies in a bid to end crippling shortages of foreign exchange and revive economic growth. The kwanza has been fixed at 166 against the dollar since April 2016, but trades at 430 per dollar in the black market.

The currency’s exchange rate will be determined at the auctions, the central bank said in a statement on its website on Jan. 4. A spokeswoman for the regulator said she had no information about Tuesday’s sale.

“There will be an exchange-rate adjustment with the kwanza losing about 15 percent of its value against the dollar,” said Tiago Dionisio, a Lisbon-based analyst for Eaglestone Advisory SA. “Once that adjustment happens, I expect the kwanza to trade between 190-210 per dollar in the foreseeable future.”

Dwindling Reserves

Central bank Governor Jose Massano said last week that the country’s dwindling foreign-exchange reserves triggered the end of a peg that “does not reflect the truth.” Reserves dipped to $14.2 billion in November from $15.4 billion in October, and are down from $20 billion at the start of 2017, according to the central bank.

To read the full article, click here.

05 Jan

Angola Joins Long List of Oil Producers in Scrapping Dollar Peg

Angola is poised to become the latest emerging-market nation to dispense with a pegged currency, another sign that a four-year slide in oil prices has battered exporters in the $2.2 trillion-a-year market.

The southern African nation, an OPEC member, said this week that it would let the kwanza trade within a new band. The rate at which it was fixed against the dollar since April 2016 “does not reflect the truth,” according to central bank Governor Jose Massano.

It joins a long list of commodity exporters — from Russia to Egypt, Kazakhstan, Nigeria and Uzbekistan — that have floated or devalued currencies in a bid to end crippling shortages of foreign exchange and to revive economic growth.

“It was a long time coming,” said Kaan Nazli, a strategist at Neuberger Berman in The Hague, which manages almost $300 billion, including Angolan bonds.

The move underlines just how forcibly President Joao Lourenco is trying to bolster his nation’s finances, three months after he replaced Jose Eduardo dos Santos, the ruler for almost four decades.

Angola, which relies on oil for more than 90 percent of exports, kept a tight grip on its currency as the commodity slid. While the kwanza has already weakened 40 percent to 166 per dollar since mid-2014, analysts say it’s still too strong. Charles Robertson, Renaissance Capital’s chief economist, said in a note Thursday that the kwanza was the most overvalued of the more than 50 currencies he analyzes and that its fair value was 348 to the greenback.

The currency has tumbled to 430 on the black market as dollars run dry, leaving hundreds of companies struggling to pay foreign workers and overseas suppliers. Economic growth fell to zero in 2016 after averaging almost 9 percent per year during the previous decade.

Angola has bled reserves — which more than halved in the past four years to the lowest since 2010 — to defend the peg. The dos Santos administration said it was the best way for the import-dependent nation to curb inflation, which stands at 28 percent.

Read more: Angola Joins Long List of Oil Producers in Scrapping Dollar Peg

14 Dec

Angola to Offer Grace Period to Recover Overseas Funds

Angola will set a moratorium in January to allow citizens with money abroad to repatriate their funds, as the oil-producing country struggles to ease an acute dollar shortage that began soon after oil prices dropped in 2014.

“Angolans who repatriate overseas funds and invest in the economy, companies that generate goods, services and jobs won’t be harassed,” President Joao Lourenco said Wednesday in the capital, Luanda. “No questions will be asked about why their money was abroad and they won’t face legal prosecution.”

The Angolan economy, sub-Saharan Africa’s third-largest, has been crippled by oil prices that have halved since mid-2014, causing zero growth last year, soaring inflation and a shortage of dollars needed to import products.

Lourenco, who took over as president in September after the 38-year rule of Jose Eduardo dos Santos, has promised to fight corruption in a country where his predecessor’s family has amassed great fortunes. He fired Dos Santos’s eldest daughter, Isabel, last month from her position as chairwoman of the state-owned oil company Sonangol.

Once the grace period to repatriate funds is over, the government will consider money in foreign accounts to belong to Angola and work with authorities abroad to bring the money back, Lourenco said.

“We want Angolans who have fortunes abroad to be the first to invest in the country, thus demonstrating that they are true patriots,” he said. “One must not confuse the fight against corruption with the persecution of the rich or wealthy families.”

The measure is similar to a decree issued last month by Zimbabwean President Emmerson Mnangagwa, who ordered anyone who had illegally moved cash and assets out of the country to return them within three months or face arrest.

Soure: https://www.bloomberg.com/africa 

07 Dec

It’s Only Been Two Months, But Angola Leader’s a Bond-Market Hit

He’s only led Angola for a couple of months, but bond investors already like what they’ve seen from Joao Lourenco.

Angola’s $1.5 billion of bonds due in 2025 have returned 8 percent since Lourenco was sworn in as president on Sept. 26, replacing Jose Eduardo dos Santos, who had ruled the OPEC member and former Portuguese colony since 1979. That’s a better performance than any other country in the Bloomberg Barclays Emerging Markets USD Sovereign Bond Index, which includes debt from more than 70 nations.

It’s not just down to oil prices rising about 5 percent in the period — the bonds of other major producers such as Mexico, Russia and Saudi Arabia have barely budged. Overall, Eurobonds issued by emerging-market governments returned an average of 0.3 percent.

Lourenco, 63, has moved fast to assert his authority in Angola, which relies on crude for about 90 percent of exports and ranks among the 15 most corrupt countries in the world, according to Transparency International. He has replaced the heads of the central bank, state oil company Sonangol and diamond firm Endiama, and started opening up the telecommunications sector to more competition.

The central bank, under new Governor Jose Massano, raised the main interest rate by 200 basis points to 18 percent last week as it looked to combat inflation of almost 30 percent. It may be a precursor to a weakening of the kwanza, according to Standard Bank Group Ltd., which says the currency is overvalued.

“While one could point to market ebullience due to elevated oil prices as a factor underpinning these bonds, the market might be getting more constructive on the policy outlook,” Dmitry Shishkin, the head of quantitative strategy at Standard Bank in London, said in a Nov. 28 note. The government has “hit some of the right notes, pointing to a desire to improve debt sustainability, cut some expenses, issue another Eurobond and continue with the reform of Sonangol.”

Source: https://www.bloomberg.com/news/articles/2017-12-06/it-s-only-2-months-but-angolan-leader-a-hit-with-bond-investors

06 Dec

Angola Gem Firm Distances Itself From Former President’s Family

An Angolan state-owned diamond company is pulling out of an investment in a Swiss firm controlled by the husband of the billionaire daughter of the former president, as the country’s new leader untangles it from the business interests of his predecessor’s family.

Sodiam will divest a stake in Geneva-based jewelry maker De Grisogono for “reasons of public interest and legality,” it said in a statement after a board meeting on Dec. 1, without giving details of how the transaction would be completed.

The company is controlled by Sindika Dokolo, the husband of Isabel dos Santos, the eldest daughter of former Angolan President Jose Eduardo dos Santos, according to Ana Gomes, a Portuguese member of the European Parliament who has done research on the business interests of Africa’s richest woman.

The move comes as President Joao Lourenco seeks to distance the oil-rich country from the influence of Dos Santos and his family. He’s fired Isabel from her position as chairman of state-owned oil company Sonangol, and last week announced plans to auction a new telecoms license to compete with Unitel SA, which she controls. Lourenco, known as J-Lo in Angola, replaced dos Santos, who has nevertheless remained head of the ruling MPLA party.

Tribune de Geneve reported earlier Tuesday about Sodiam’s exit from De Grisogono. The company lost money on the investment, it said. A call to the offices of De Grisogono wasn’t answered.

Sodiam is a former unit of Endiama, another state-owned diamond company in Africa’s biggest producer of the precious gems.

Source: https://www.bloomberg.com/news/articles/2017-12-05/angola-gem-firm-distances-itself-from-former-presidents-family 

01 Dec

Angola Plans to Open Up Telecoms Industry to Foreign Bidders

Angola plans to sell a minority stake in a state-owned telecommunications provider and hold an auction for a fourth industry operator as new President Joao Lourenco shakes up the business environment and reduces the influence of his predecessor’s family.

The government of the oil-rich west African country has received several expressions of interest from local and foreign investors in the new telecommunications license, state-owned news agency Angop said, citing the country’s Ministry of Telecommunications Jose Carvalho da Rocha. The winning bidder will be able to offer fixed-line, mobile, internet and paid-television services, Rocha said.

A 45 percent stake in Angola Telecom will be sold, the minister said. The state-owned firm competes with Unitel SA, controlled by Isabel dos Santos, the former president’s oldest daughter and Africa’s richest woman. The third operator is Movicel Telecomunicacoes Lda, which is also privately owned.

The move comes as Lourenco seeks to distance Angola from the influence of former President Jose Eduardo Dos Santos and his family. Earlier this month, he fired Isabel Dos Santos from her position as as chair of state-owned oil company Sonangol, while the government told the state television station to cancel contracts for the management of a local and an international state-owned channel with two of Dos Santos’s younger children.

Tendering Process

The rules of the telecommunications license tender will be made available to investors by the end of the year and the Angolan state will retain a 45 percent stake in the new operator, said Rocha. The tender is expected to take more than three months, he said.

Lourenco became President of Africa’s second-biggest oil producer in September, replacing dos Santos, who was in power for 38 years. Lourenco has vowed to open up Angola’s economy to more competition and reduce corruption as it struggles to overcome an economic crisis that began soon after oil prices started to fall in 2014. Oil accounts for more than 90 percent of the country’s exports.

Auctions for new telecommunications licenses in Africa are rare, as most countries have already held privatization initiatives. The continent’s biggest wireless carrier by subscriber numbers is Johannesburg-based MTN Group Ltd., while Vodafone Group Plc unit Vodacom Group Ltd. is the largest by market value.

Zambia has also started the process of auctioning a fourth mobile-phone license. Vodafone is one of the interested parties, a person familiar with the matter said in September.

Source: https://www.bloomberg.com/news/articles/2017-11-30/angola-plans-to-open-up-telecoms-industry-to-foreign-bidders