 Agriculture |
 sowing the seeds of recovery |
Until 1975, Angola was the 4th largest coffee producer and the 3rd largest sisal producer in the world. The country was self sufficient in all key food crops and exported a surplus of maize. Today Angola is a net food importer and the coffee and sisal output barely satisfies local needs. According to the Ministry of Agriculture, the country consumes 1.3mn tons of cereal per year. In 2000 production barely reached 500.000 tons, the rest is either imported by the government or donated by the international community.
The exodus of skilled Portuguese farmers in the years following independence, the failure of the system of state farms that followed and the rampant use of land mines in a virtually uninterrupted 25 year civil war have been the causes of such a steep decline.
Despite being the second largest source of national income, employing 76% of Angola's 12 million population, last year the sector represented only 12% of GDP against 45% for the oil and gas sector. As the war continues to displace populations inside Angola, the government is confronted with the difficult task of transferring some of its oil wealth into agriculture. IDA (a Portuguese acronym for Agrarian Development Institute) is in charge of executing government policies on agrarian issues. 'Our primary function is to increase the output of Angola's agriculture sector says Mr Pedro Canga, Director of IDA. This is done in part through a program to integrate internally displaced populations in the most secure areas allowing people who were previously dependent on donations to produce their own foods. The result is that malnutrition has dropped in Malange, one of the areas most affected by food shortages and, overall, Angola's cereal production deficit dropped to 420 million tons in 2000.
The Instituto de Cereales (ICER) another government agency attached to the ministry of Agriculture is working towards reaching food self sufficiency in Angola by assisting small and medium size farms to increase their output, helping them purchase fertilisers and paying them a fair market price for their crops. 'we also invite foreign investors to take advantage of the huge opportunities Angola offers in this sector. We are a large country with a lot of fertile land, the only limitation to our growth at the moment is the threat of terrorist action but baring that, Angola now meets the pre conditions for foreign investment in the agriculture sector' explains Mr. Miguel de Carvalho Director of ICER, referring to the recent reform in the sector.
While agro-industry is still in its infancy, some private projects are being implemented in the area surrounding Luanda and the government is interested in attracting foreign investors into this process. 'Angola's new investment law and proposed land law are designed with that objective in mind,' says Mr. Canga. Indeed, Oderbrecht a Brazilian multinational has recently invested in a cereal project outside Luanda. Investors from Spain are also carrying out a feasibility study on a similar project in the province of Bengo, to the Southeast of Luanda.
The Spanish, who have a long history of bilateral finance with Angola are also very active in the fishing industry under co-operative agreements between Angola and the European Union. Last year was Angola's best fishing year since independence. An increasing number of private fishing companies from overseas are benefiting from its rich fishing resources off its 1650kms southern coastline.
But the resurgence of Angola's agriculture lies in the country's coffee plantations. 'Coffee has strong historical meaning routed in Angola's colonial past. For many Angolans, coffee is the key to improving their social conditions' says Manuel Dias Director of the Instituto Nacional Do Café responsible for theimplementation of the government's coffee policy. In 1974 Angola exported 228.000 tons of coffee. Last year coffee exports were barely 3000 tons. Large plantations were dismantled in the eighties and the government now relies on stimulating small private producers to re-launch the coffee industry through grants and cheap loans for fertilisers and machinery.
| According to Mr Dias: 'Mechanisation of the industry is just a matter of time since the country now has a business friendly government and the security situation in rural areas is improving'. Indeed, according to a report published last year by the embassy of Angola in Washington DC, the Portuguese company Delta Café is rehabilitating Angola's main coffee factory which had been dormant for 15 years.
With the return to a market economy and the liberalisation of the coffee export market Angola's largest coffee company, state owned CAFANGOL is up for privatisation. Founded 18 years ago at the time of Angola's planned economy the company must now compete with over a dozen competitors who export the country's coffee production to Europe.
In view of its privatisation CAFANGOL has been stripping itself of unprofitable assets and has halved its labour force from 480 to 240. Its four main areas of activities will become private companies in the near future. These include:
1.Coffee exporting.
2.Coffee processing for the export market
3.Coffee grinding and roasting
4.Importing and distributing specialised packaging to other exporters in Angola
However, Mr. Alvaro Faria, Managing Director of CAFANGOL, would rather prefer a single foreign investor take over all four activities.
Today coffee output is 5% of its 1965 all time high of 240.000 tons. In 2000, Angola exported 7000 tons of mainly 'robusta' coffee to EU countries. Currently no coffee exports go to the US due to the lack of regular commercial shipping lines between the two countries. The country's main competitors are Vietnam and Indonesia 'but Angolan coffee's quality standards are superior' adds Mr Faria.
Due to the war, farming lands have been left fallow and thus ecologically sound. Angola could join the club of green producers who cultivate in a truly sound ecological environment. These are enjoying tremendous success particularly in Europe. The provinces of Huambo and Bie situated on Angola's central plateau and the province of Kwanza Sul all present ideal climatic conditions for the production of robusta coffee and would be the first to benefit should the military situation continue to improve.
Angola' forestry is another important component of Angola's agricultural potential. 35% of Angola's territory is covered by forest and 5% has economically viable timber concentrated in the northern provinces of Cabinda, Uigé, Zaire, and the eastern provinces of Moxico and Bengo. The country is blessed with up to 800 species of trees but so far only 15 are exploited by the logging industry, the most famous are mahogany and ebony.
The Instituto de Desenvolvimento de Florestas (IDF), is responsible for promoting and regulating the forestry industry. IDF Director, Mr. Caetano says his most important concern is to insure that Angola's forests are exploited in a sustainable way through the establishment of methodological norms of conservation and exploration. 'While production should be increased thanks to government loans and foreign investment it should not surpass the sustainable level of 350.000 cubic metres per annum. In 1973 production went as high as 550.000 cubic meters an 'unsustainable level' according to Mr. Caetano. 'Back then Angola exported most of its production to Portugal but today IDF's objectives are different' he adds: 'We expect to export 30%, the rest will be processed or semi-processed in Angola'.
Despite security issues, two timber companies are active in the northern Cabinda enclave, and Panga-Panga, a Luanda based company, has recently invested in a new timber processing plant. But last year Angola produced a mere 35.000 cubic meters, only 1/10 of its sustainable level and well under its domestic needs. 'There is still enormous scope for private investment in the industry' concludes Mr. Caetano.
With the continuation of terrorist activities in Angola's rural highlands agriculture and forestry is not about to enter a spectacular revival but economic reform and the continued weakening of the UNITA rebel movement is paving the way for a recovery. 'It is not safe to invest in any region of the country but the perception of insecurity in Angola overseas is exaggerated and does not reflect reality. Today there are ways to guarantee security in many areas where people from overseas think it is impossible. The problem is lack of information and ignorance.' Explains Mr. Morais Managing Director of Teleservice a security company with corporate clients operating throughout the country. |
