 Industry |
 starting all over again |
Apart from in the oil sector, Angola's industrialisation moved backwards for much of the last quarter of the twentieth century. The economy's industrial capacity was either looted, destroyed or fell into disrepair. Many factories closed down due to lack of local skill, the absence of spare parts and dropping local demand. Angola's industrial decline was as spectacular as its rise. Manufacturing experienced rapid growth boosted by the coffee boom during the sixties. According to government figures, the sector then counted over 4000 production units, employed up to 200.000 men and produced $650mn worth of goods.
Today up to 90% of Angola's consumption is imported. This deficit is financed by the country's huge oil reserves. But thanks to the arrival of big foreign investors in the oil and diamond industry and the end of the war, demand from Angola's local and expatriate population could be about to take-off, paving the way for a resurgence industry to its pre-war levels.
With this objective in mind the industrial development agency (IDIA) has been set up since 1995.
Mr. Kiala Gabriele, Director of IDIA has a very clear idea of his mission:' the state wants local and foreign capital in industrial development, so we must create the right conditions to attract that capital'. IDIA's development strategy is based on a three pronged approach which involves the creation of industrial parks in association with the private sector, the rehabilitation and privatisation of existing manufacturing plants along with the installation of new industrial capacity, and the reform of industrial investment legislation.
According to Mr Kiala, oil giant Chevron is collaborating with IDIA on the promotion of a 2345 hectares industrial park in the oil rich enclave of Cabinda. In another project, 8000 hectares have been set aside in Luanda a suburb of Viana for the development of an industrial park. In preparation for industrial facilities, the government has already started installing new roads, water and electricity mains. The 214-hectare industrial park in Benguela is also a priority for IDIA since it is located near Lobito, Angola 's deepest port in commercial terms.
Under the IMF staff monitored plan, the Minister of Industry, Joaquim David, is giving priority to food processing and light industry. So far over 250 parastatals have been reorganised into over 800 smaller, private firms.
The first foreign investors to react have come from the drinks industry. In 1999 the Coca-Cola company built a $36mn bottling factory south east of Luanda and last year South African Breweries pledged $6 million for the construction of a second Coke plant in the southern town of Lubango. But Coca Cola is not the only one with its eye on Angola's fledgling drinks market. Dutch brewer Heineken has taken control of Eka, a recently privatised brewery and family owned BGI of France are participating in the privatisation of Cuca, Angola's largest brewery. Added to all this comes a $21,7 million foreign investment project to make fruit juices as well as bottled water and spirits.
Another ministry with a key role for industry and investment has been the Ministry of Commerce. Since the early nineties when the government set about turning Angola into a market economy it has been responsible for regulating commercial activity in the country. This has included the reform of the country's commercial law resulting in decree 29 dated 2/7/2000, which regulates internal commercial activity, and decree 55 dated 10/11/2000 that regulates external commercial activity. | 
Minister of Commerce Victorino D. Hossi has been in office for four years. 'Our principle concern is to guarantee a secure legal environment for both local and foreign investors not only in the traditionally privileged oil industry, but in all sectors of the economy. This is an inevitable condition if Angola is to take full advantage of its comparative advantages within the SADC he explains. Indeed, the Southern African Development Community constitutes an increasingly integrated trade zone with over 200 million inhabitants. ''To guarantee self sufficiency we want to encourage industries that process raw materials available in Angola. Surplus output can then be exported to the rest of the SADC'': adds Mr. Kiala referring to Angola's strategic situation as a gateway to the region. In March the Benguela sugar factory was inaugurated following a $5 million government financed restoration by an Anglo-American consortium. The factory will produce 200 tons per day making Angola self sufficient in sugar. This project is part of a two phase government plan to rehabilitate food processing facilities before the privatisation takes place.
Such opportunities abound in other areas of food processing such as wheat flour, cooking oil, molasses, or salt. In light industry there are opportunities in textiles, soap, shoes, matches, paint, glues and plastics.
Much of Angola's industrial resurgence can be attributed to the efforts of the Associacao de Industriales de Angola (AIA). The association is one of the leading voices of Angola's civil society and is the host to the country's largest trade fair held every year in June. Mr José Severino President of AIA explains how civil liberties have changed for Angolans: ' from 1994 to 1998 we went through some rough times because (…) most of those in the government institutions were not well informed on open market policies as they were educated in a centralised socialist system. But now we are able to press for reforms and share new ideas with the president himself'. Mr. Severino's words are testimony to how far the country has come in allowing civil society to participate in the democratic debate. 'I was even jailed for my slant towards democracy and capitalism' he says, referring to the country's not so distant communist past.
According to Mr. Severino industrial output must grow at 25% if it is to regain its pre independence importance. While he is very satisfied with recent government liberalisation policies and the decision to follow the IMF staff monitored program he is concerned that Angola's infant industries are not benefiting enough from the growth of the oil and diamond sectors. 'We are lobbying strongly for oil and diamond companies to use the Angolan banking system' says Mr Severino. Indeed, industry needs a stronger, more liquid banking sector, capable of backing long term investment in Angola's productive capacity.
The reform of Angola's tariffs and quotas is also top of the agenda as it will 'help Angolan companies exploit their comparative advantages within the SADC'. Mr. Severino explains. While he remains conservative about the short term prospects of Angola's manufacturing sector he believes it will be the fastest growing sector of the economy during the first quarter of the 21st century. 'Communication and consultation between the government and civil society has made great progress since the collapse of Angola's socialist regime. The IMF and the World Bank are condoning this process by providing technical and financial assistance for the structural adjustment of Angola's economy'.
Since 1975, Angola's establishment has experienced many frustrations, with the war remaining at the centre of all of them but according to Mr. Severino Angola's people and its leaders know the effect of war and have had enough. His final message: 'We would like to make your readers aware of the fact that the war is nearly finished, that Angola is changing its policies and looking for increased co-operation with foreign companies'. |
