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This publication is available at https://www.gov.uk/government/publications/overseas-business-risk-angola/overseas-business-risk-angola--2
Information on key security and political risks which UK businesses may face when operating in Angola.
Government and business are inextricably linked in Angola. Political interference is reportedly prevalent in many areas of the business environment. The Government has signalled its intention to address this, and the push towards privatisation of some of the larger state-owned business should help to curtail this interference. The country has witnessed considerable political stability since the end of the civil war in 2002. Peaceful general elections were held in August 2017, when the ruling MPLA retained power, albeit with a slightly reduced majority. Although there are no major indicators of instability the economic downturn has heightened the risk of street protests which have become more common with some reports of human rights violations. A common complaint is perceived corruption among business and government elites and widespread poverty despite the country’s oil wealth.
The Angolan economy is expected to continue to recover in 2018 with IMF predicting 2.2% growth - compared to no growth in 2016; and 0.7% in 2017. The economy has been hit hard by the sharp decline in international oil prices since 2015. This has led to sizeable cuts in public spending causing considerable delays in the State’s payments to suppliers and restrictions on foreign currency supplies, with a knock-on effect felt in all sectors. In 2016 Angola ended remaining fuel subsidies leading to a sharp increase of petrol and diesel prices. The Kwanza hit record lows against the US Dollar, creating a significant gap between official and parallel market rates and putting pressure on the country’s international reserves (currently at 5.6 months’ worth of imports). Consequently, in January 2018, the Government announced the end of its currency peg against the US Dollar as part of a major macroeconomic plan to improve the business environment and boost growth. The African Development Bank (AfDB) still forecasts high inflation in 2018 at 21%.
Since 2013 it is illegal to trade in any currency other than the Kwanza. The country has taken steps to increase fiscal transparency, adhering to IMF recommendations. Spending controls have been tightened to ensure the necessary funds are available before Ministries sign contracts. The Ministry of Finance, through the National Public Procurement Service (SNCP), also announced the launch of an e-Procurement portal for all public tenders by September 2019.
The country is sub-Saharan Africa’s second biggest oil producer and continues to be heavily reliant on the commodity (over 90% of its exports). The Angolan government is pursuing plans to diversify the economy and is actively engaged in encouraging overseas companies to invest. Angola currently ranks 175th out of 190 economies in the World Ease of Doing Business Index.
Angola is rated at B- (stable) by Standard & Poor’s. Fitch revised its rating from B (negative) to B (stable) in April 2018 due to higher oil prices and the adoption of a set of reforms by the Angolan government. Moody’s downgraded Angola’s risk rating to B3 (from B2) with a stable outlook. The UK government can provide finance or credit insurance specifically to support UK exports through UK Export Finance – the UK’s export credit agency. For up-to-date country specific information on the support available see UK Export Finance’s country cover policy and indicators. For more information on exporting to Angola see our exporting guide.
Angola’s 2010 constitutional revision means that it has modern labour and employment laws including provision for the protection of employees’ rights (including the right to join a trade union). In practice, the developing nature of Angola’s economy and the inconsistent application of the law has resulted in disputes over payment of salaries, forcible resettlement and unregulated pollution, and reprisals have been known to occur as a result of complaints and strikes. Angola has ratified all 8 fundamental conventions of the International Labour Organisation. Specific concerns have been raised by opposition parties, international and national civil society and non-governmental organisations over alleged human rights abuses, particularly in the provinces of Lunda Sul, Lunda Norte, Huambo and the exclave of Cabinda. There are continued reports of forced evictions from homes in slum areas and land grabs in some provinces in Angola to make way for infrastructure projects (although free housing is being provided by the Angolan Government). There are more frequent reports of the right to protest being undermined, and in 2016 the Government of Angola passed a law on the work of NGOs in the Angola believed by many to be highly restrictive. Concerns have also been raised around freedom of expression in Angola and, although self-regulation occurs throughout the mainstream media, there has been a noted increase in debate since President João Lourenço took office in September 2017. The UK Government is committed to promoting respect for human rights amongst UK companies operating anywhere overseas. We stand ready to help British firms with advice on their political and reputational risk management.
Bribery and Corruption
Bribery is illegal both in the UK and in Angola. It is an offence, under the UK Bribery Act 2010, for British nationals or someone who is ordinarily resident in the UK, a body incorporated in the UK or a Scottish partnership, to bribe anywhere in the world. In addition, a commercial organisation carrying on business in the UK can be liable for the conduct of a person who is neither a UK national or resident in the UK nor a body incorporated or formed in the UK. In this case, it does not matter whether the acts or omissions which form part of the offence take place in the UK or elsewhere. Angola ranks 167 out of 180 in Transparency International’s corruption perception index 2017.
Bribery and corruption are prevalent throughout Angolan society, particularly within the civil service and police. However, President João Lourenço has made the fight against corruption his government’s priority. The regular dialogue that the IMF has developed with Angola, as well as the regular visits from commercial credit rating agencies that began in 2013 with Angola’s first rating, have also had a positive impact. There have been a number of high-profile court cases against senior officials which have resulted in some custodial sentences.
Read the information provided on our Bribery and corruption page.
The threat of terrorism is low throughout Angola, although separatists in Cabinda have in the past targeted foreign companies, usually in the interior of the province.
Read the information provided on our Terrorism threatpage.
Most international companies and organisations operating in Angola have strict security rules and regulations for their staff. They should be read in conjunction with the advice in these pages.
There is a high level of crime in Luanda. Muggings (particularly the theft of mobile phones) and occasionally armed robberies can occur in any area at any time of the day or night. We do advise caution and common sense when out and about. For further information and updates please refer to FCO Travel Advice.
Read the information provided on our Protective security advice page
Angolan laws are weak in this area and are almost never enforced.
Read the information provided on our Intellectual Property page.
Organised crime appears to be limited; however, there are signs that it is on the rise. There is evidence of drug smuggling and reports of human trafficking that could well be linked to organised crime.
Read the information provided on our Organised crime page.
Contact the DIT team in Angola for more information.