Posted on Wednesday, 03 December 2014 18:04

Can Angola's elite transform itself?

By Ricardo Soares de Oliveira

Even in the times of 'Africa rising,' few of the continent's states have exuded the self-confidence of Angola. 

Some economists may find the authoritarian, state-led development strategies of Ethiopia or Rwanda more admirable, but it is Angola that has posted a tenfold increase in its gross domestic product since the end of the civil war in 2002, making it sub-Saharan Africa's third-largest economy and about three times the size of Kenya's in 2013.

These challenges are of the utmost seriousness

Armed with oil money and the 2002 victory against the União Nacional para a Independência Total de Angola rebels, whose leader Jonas Savimbi had enjoyed support from the US and apartheid South Africa, the Movimento Popular de Libertação de Angola (MPLA) regime has rebuilt war-torn Angola with minimal input from Western governments and NGOs.

Luanda's skyline changed beyond recognition as the elite sought to create an African Dubai that fit its ambitions.

In a remarkable post-colonial reversal of fortune, Angola's oligarchs have become some of Portugal's largest foreign investors.

But although Angolan decision-makers bluster about their country's emerging-power status, in reality it is rather brittle.

Some of the accomplishments are real. Although at a staggering cost, Angola's infrastructure has been partly rebuilt.

Technocrats were empowered to stabilise the economy, build up the country's hard-currency reserves and make Angola more presentable for some forms of foreign direct investment.

The MPLA's style of governance after the war, while politically intolerant, has at least placed large-scale violence out of the picture.

These are impressive achievements. However, four major challenges prevent Angola from advancing much further and may even imperil the progress of the past few years.

First, Angola remains one of the world's most oil-dependent economies: oil accounts for 97% of export revenue. This makes Angola extremely vulnerable to the vagaries of the oil price.

The MPLA regime has made impressive promises to diversify the economy, but its record does not stand much scrutiny.

Agricultural investment consumes an estimated 1% of the country's budget, much of it on big agribusiness projects, but it has failed to produce many jobs or crops.

Industrialisation has been slow and chaotic. Factories lacking electrical supply have been built and operated by foreigners through turn- key contracts. Their meagre and expensive output is uncompetitive in local, let alone foreign, markets.

Beyond the rhetoric, the Angolan oligarchs around the presidency, the party and the military show very little interest in investing in productive sectors. They prefer to put their money in foreign real estate and investment portfolios, not local industry and agriculture.

Angola's second major challenge is the training of its people and the lowering of the country's dependence on expatriates.

The reconstruction of the country is the product of a foreign labour force of Portuguese, Chinese, Brazilians and those of many other nationalities.

While critically important for the government's development strategy, these expats are incurring the resentment of the rising Angolan middle classes, who see them as obstacles to social mobility.

At the same time, the quality of Angola's education system is, with rare exceptions, so poor that local university graduates are consistently side-lined in the job market.

A leading MPLA cadre who did not wish to be named describes this tension as a "time bomb" that can only be defused by strong investment in Angolan social capabilities.

Third, Angolan society is changing at a dizzying pace. For the first decade after the end of a war that, in different guises, had lasted more than 40 years, Angolans were simply happy to be alive.

The ruling party was able to shape the country as it pleased with minimal opposition from the masses.

Over the past three years, Angolan society has reawakened, and people are increasingly rejecting the status quo.

Foreign media have homed in on rappers' social criticism and a number of small yet persistent demonstrations by critics of the regime. The dissatisfaction runs much deeper.

Though the peace years have spawned a middle class of sorts, the vast majority of Angolans have seen no benefits from the country's oil boom. Social indicators remain some of the worst in the world. The elite, meanwhile, has only grown richer.

Angolans above a certain age still compare the present favourably to the war years. Yet those below 25, about 70% of the population, yearn for the material success of the elite. This is something they are confronted with in the garish media and in the streets, but it remains out of reach.

The young will not stay quiet for long, and their mobilisation will have serious consequences for Angola.

The final challenge is President José Eduardo dos Santos's succession.

Observers have devoted years to reading the coffee grounds: will Dos Santos choose his eldest son, now in charge of the country's sovereign wealth fund; vice-president Manuel Vicente, formerly the chief executive of Sonangol; or an as-yet-unnamed dauphin? What do the MPLA and the armed forces think?

This obsessive speculation is entirely justified. Dos Santos has spent the past 35 years carefully centralising discretionary power, if need be by undermining his own government and political party.

If he cannot protect his interests and those of his closest family and allies, he will simply
stay on until he dies.

Dos Santos is a shrewd, micromanaging political player who moves with the times, but his centrality to the system has only grown stronger.

The more open character of the postwar economy is entirely dependent on his personal role as umpire and guarantor rather than the work of formal institutions or the rule of law. It can all be reversed overnight.

According to the World Bank, Angola remains one of the world's most complicated business environments.

A foreign investor who requested anonymity notes: "The palace, not the courts, is our ultimate guarantee of stability."

Whether Dos Santos will go quietly and whether Angola's elite can operate a successful transition are the key questions for the coming years. These challenges are of the utmost seriousness.

They call not for 'governance improvements' or some such piecemeal tinkering with the system but for an entirely different approach to the running of the country that unequivocally breaks with business as usual.

The paradox of the Dos Santos-dominated, MPLA-run political and economic order is that those called upon to tackle the challenges at this critical juncture are the same social groups – the same individuals – who have long held the reins of power, benefited from the status quo and allowed these problems to fester.

That raises the biggest political question of all: can this elite transform itself? ●

Ricardo Soares de Oliveira is the author of the forthcoming Magnificent and Beggar Land: Angola Since the Civil War (Hurst).

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