Role reversal as former colony Angola eyes Portuguese assets
Portugal's Prime Minister Pedro Passos Coelho travels to Angola on Wednesday to strengthen trade ties and discuss Luanda's interest in buying shares in some of Lisbon's state companies.
The former colony, which for decades was torn by civil war, is now rising economically while its former oppressor battles the eurozone debt crisis.
“I can’t think of anywhere where it has happened like this,” said Pedro Seabra, a researcher at the Portuguese Institute of International Relations and Security (IPRIS) in Lisbon.
“You have Tunisia and Algeria which have strong companies operating in Europe, but nothing on the scale of the Angolan investments we’re seeing in Portugal,” he said. “I am sure we are going to see a lot more Angolan purchases of Portuguese assets in the near future.”
Portugal’s economy is set to contract 2.8 percent in 2012, while resource-rich Angola is set to grow by 12 percent, leaving Luanda with cash to spare — just as Portugal is being forced to sell off state companies under the International Monetary Fund’s 78 billion euro ($107 billion) bailout.
Air carrier TAP, utilities company Energias de Portugal, the failing Banco Portugues de Negocios (BPN), and national grid operator Redes Energeticas Nacionais are all on the block.
According to IPRIS research, Angolan investments in Portugal, both state and private, rose from 1.6 million euros in 2002 to 116 million euros in 2009.
Angolan companies now own the equivalent of 3.8 percent of companies listed on Portugal’s stock exchange, from banks to telecoms and energy, the Lisbon think-tank said.
Passos Coelho, who as a child lived in Luanda where his father was a colonial-era doctor, will be in Angola for just over 24 hours, meeting President Jose Eduardo dos Santos and Portuguese business leaders.
Dos Santos’ chief of staff Carlos Maria Feijo said Angola would discuss Portugal’s privatisation scheme during the premier’s visit.
“What I can tell you is that I think that each country is respecting its own interests and is just following its own interests,” he told AFP.
“Many Angolans have business interests in Portugal, but also a lot of Portuguese people are here in Luanda making business, so I would say it’s a reciprocity which is good for both countries.”
Dos Santos’s daughter Isabel is known to have a large Portuguese portfolio, as does the state oil firm Sonangol, but the identities of many other shareholders in Portugal are concealed, obscuring the true extent of Angolan investment.
“These deals are very opaque and we rarely know who is really behind them or where the money came from,” Seabra said.
“Of course this is causing people in Portugal some concern and I think as more money comes in from Angola, more questions are going to be asked.”
This has also raised concern about why Angolan firms aren’t spending the money at home, where an estimated two-thirds of the population live on less than two dollars a day.
“I would prefer that they invest this money here in the country, in agriculture, manufacturing or power generation, and not abroad,” Economist Manuel Alves da Rocha, from Angola’s Catholic University, told AFP.
“But you know that private companies have all the right to decide how to invest their savings.”
Firms like Sonangol have multi-billion-dollar gaps in their books, according to graft watchdog Global Witness, heightening concerns about the source of the money flowing abroad.
“The Portuguese should be asking questions about where this money is coming from,” Angolan anti-graft campaigner Rafael Marques said.
“If they don’t ask these questions, they risk Portugal becoming a Laundromat for Angola’s ill-gotten gains.”