Angola at the Crossroads

Between Kleptocracy and Development

Rui Santos Verde

• Publisher: I.B. Tauris
• Year: 2021
• Print ISBN: 9780755640560
• eBook ISBN: 9780755606757
• Edition: 1
• Topic: Economics
• Subtopic: Political Economy
• Index: Economics

Angola is poised between a past marked by civil war and corruption, and a future of potential economic development. This book examines the post-Civil War period which began in 2002 and saw the rise of a corrupt ruling elite, as well as recent developments in the country. These include the efforts of the current President, João Lourenço, to reform the regime through political openness, economic growth and a crackdown on corruption. Rui Santos Verde analyses the country's recent history of corruption and the current attempts at reform in order to determine whether economic and political development is on the horizon for Angola, or whether these reforms are simply a move towards consolidating President Lourenço's personal power.

Part 1

Dos Santos’s last moves (2010–17)

1

Hope revisited (2010–14)

Luanda bay is almost idyllic, with spits like arms of land serenely and warmly embracing the sea. Seen from Ilha de Luanda (a nearby island, now linked to the continent), Luanda’s skyline was, again in 2010, bursting with activity, with buildings under construction, cranes operating, a new modern city finally taking the place of the old Portuguese colonial architectural layout. After the 2009 economic crisis, there was a renovation of hope. The economy gained ground again and major projects were coming back. From the low prices of previous years, when it dropped almost to US$60 dollars a barrel, in 2011, oil once again broke the US$120 barrier. Significantly, until 2014, it did not fall below US$100. The direct relationship between the price of oil and Angolan economic growth was once again decisive, demonstrating the country’s complete dependence on crude oil. The economy recovered too, and public finances were balanced. In 2011, GDP grew to 3.4 per cent, and in 2012, it accelerated to 8.5 per cent. It seemed that the hectic pace of the recent years would return.

Nonetheless, news of systemic corruption and what is now called the ‘capture of the state’ abounded. In 2010, Marques published perhaps one of his most compelling and destructive texts,¹ revealing the way Angola’s presidency was used as a shady business cartel and the consequences of this practice on the freedom and development of citizens, as well as on the political and economic stability of the country. In his text, Marques alleges that a presidential triumvirate composed of General Manuel Hélder Vieira Dias Junior (‘Kopelipa’), the minister of state and head of the Military House of the Presidency of the Republic; General Leopoldino Fragoso do Nascimento (‘Dino’), presidential communications director; and Manuel Vicente, then chairman of the board of directors and managing director of Sonangol meddle in the political economy of Angola, making no distinction between public and private affairs and their own purse. At the root of almost all the schemes lay Sonangol, the largest company in the country and the largest contributor to state revenue. It was undoubtedly the main source of illicit enrichment of the Angolan leaders. These were Marques’s conclusions.

But the accusations of wrongdoing did not come only from the main Angolan civic activist. In the following year (2011), the IMF published a note on the disappearance of large amounts of money from the Angolan treasury. It was euphemistically called an ‘Unexplained Residual in the Budget’.² This residue was equivalent to about US$32 billion and would have come about between 2007 and 2010. What is perplexing is that this discovery did not lead to any practical action, but to a mere exchange of words between the government, some NGOs and activists. There was no follow-up, neither from the IMF nor from any international organizations. In fact, 2011 and 2012 would see a renewal of the global projection of the financial power of the Angolan elite, namely in Portugal.

Reversal of fortunes: Angola disembarks in Portugal

In modern history, Portugal was the first European country to reach the shores of sub-Saharan Africa and the last to leave.³ In the case of Angola, Portuguese nobleman Diogo Cão landed at the mouth of the Zaire River in 1482, and Angola’s last Portuguese governor, Admiral Leonel Cardoso, only hastily fled the country in November 1975, leaving it in a state of civil war. The Portuguese colonization lasted around 500 years, mainly ordained with the power to exploit the business of slavery across the Americas. Angola was the main source of slaves transported to Brazil. It is no exaggeration to say that at least until the second half of nineteenth century, the slave trade was the focus of the Angolan colonization, and up to 1961, forced labour was legal.⁴

Decolonization was a deeply traumatic event, both for the Angolans and the Portuguese. The former had been forced to fight uninterruptedly since 1961, the latter ended the process, breathless and exhausted. The Portuguese military had no choice but to overthrow their own nationalist and authoritarian regime that persisted with the war. The speed at which the end unfolded caught many Portuguese civilians living in Angola off guard and they had to flee the country leaving all their possessions behind. It is enough to look at the colonial city of Luanda, its durability and architectural extension to realize that the Portuguese thought they would stay in Angola forever.⁵ For all these reasons, it could be assumed that relations between both countries and their peoples would not recover quickly. And indeed, for several years no proper dynamic was established between the two countries, still hostages to war. Most contacts and businesses were handled by former Portuguese military personnel who were close to the Communist Party and had contributed to arming and transferring power to the MPLA.⁶ Portuguese political parties, with the marked exception of the communists, were initially leaning towards supporting UNITA, and in Portugal there was a great deal of acrimony about the decolonization process. This situation began to be reversed with Portugal’s intense participation in the Bicesse Accords in 1992, which, despite their failure, created the conditions for a renewed proximity between the two countries.

After 2002, a large portion of Angolan investments were made in Portugal. Important acquisitions to be mentioned are a large part of Galp, the Portuguese oil company, in 2006, and a position at BPI, one of the most important banks in Portugal, in 2008. Also, real estate, hotels, vineyards and farms were collected by the Angolan elite. In 2011, Portugal faced a severe financial crisis, hinted at previously due to the continual lack of productivity and competitiveness of the economy. This crisis was not a ‘burst bubble’ crisis, but simply reflected one fact: there was no efficient application of money or capital in Portugal. The European Union/IMF’s intervention and subsequent austerity is known. What is less documented is that this was an opportunity for Angolans to expand their businesses. The money-hungry Portugal welcomed Angolan money with open arms, not caring about the origins or such dull details such as Angola’s endemic corruption.

Lisbon, 2012: Portuguese television broadcasting the images of Angolan gentlemen in fine-cut Italian suits, perfectly polished shoes, discreet silk ties, sporting American-style smiles while entering the Hotel Ritz. With them are the best-known Portuguese lawyers and financiers, exuding an air of importance, as if they dominated everything. They dominated nothing. The news that came out was quite simple. The Angolan gentlemen are now the owners of the Portuguese Millennium Bank where their money was housed. The circle was closed.

Another paradigmatic case was the luxury residential complex of Estoril Sol Residence, situated on the seafront in Estoril, Portugal. The complex has some of the most expensive apartments in Portugal, ranging from one million to about six million US dollars per unit, and became known as the ‘Angolan building’. Angolan elite constituted the main clients of this real estate project that started in 2010. Angolans apparently owned approximately thirty apartments.⁷ The most famous holder was, perhaps, Manuel Vicente, head of Sonangol and future vice president of the Angolan Republic. He paid about US$3.8 million for the whole ninth floor with a privileged sea view, and the money was funnelled through several offshore companies. Curiously, these same companies had been used to buy the apartments of General Dino and General Kopelipa. Despite the high prices, Angolans ostensibly bought several apartments in the complex. Some of the acquisitions raised suspicions with the Portuguese judicial authorities, who subsequently opened criminal inquiries. These inquiries became a cause célèbre due to the effects they had on the Portuguese judiciary and in Portuguese politics. The magistrate responsible for the investigation of Manuel Vicente was Orlando Figueira. Figueira was a high-ranking DCIAP magistrate. He filed the lawsuits and abruptly abandoned the magistracy, starting to work in a bank dominated by Angolans. Later, this situation led to a criminal charge that greatly disrupted relations between Angola and Portugal.

In 2013, the Portuguese foreign minister, Rui Machete, sent ‘diplomatic apologies’ to the Angolan state for judicial investigations that affected high dignitaries of its regime. And, violating the secrecy of justice, the minister also said that in the ongoing investigations in Portugal, which, for the most part, involved suspicions of massive money transfers, there was nothing substantially noteworthy, making it clear that if something was wrong, it was only in the filling of the bureaucratic forms. With this fragility, Portugal opened the doors of the European Union to Angolan capital without paying particular attention to the origin of the funds or the accusations of corruption that were already abundant.

Angola’s positive coverage in the Portuguese mass media was greatly expanded. In January 2012, Portuguese state television (RTP) broadcasted live from the Angolan capital a programme to commemorate the reunion between the two countries. The engagement of public TV, then supervised by Minister Relvas, was criticized by Pedro Rosa Mendes, a radio host on Portuguese public radio (RDP), in noticeably clear terms. A few days later Mendes was fired from RDP for indeterminate reasons. Later, when Minister Relvas left the political arena and returned to private life, he entered into several businesses with the Angolan elites. For example, he joined the former deputy governor of the Angolan Central Bank, Mário Palhares, to compete for the privatization of a Portuguese investment bank, Banco Efisa.

Perhaps the most important news piece of Angolan promotion was a lengthy prime-time reportage on a private Portuguese television channel, TVI, a few years later. In this broadcast, Portuguese journalist Victor Bandarra outlined a shimmering panorama of Angola, a rapidly developing country with unique growth perspectives. This was all part of the image of renewed strength that the regime was projecting.

What is interesting to emphasize is that these events were not typical of neocolonialism,⁸ neither in its old form as the continuous economic dominance of the colonial power over the new country, nor in what can be called a new neocolonialism or ‘neo-neo colonialism’. The neo-neo colonialism or judicial neocolonialism takes the shape of the Western countries trying to impose their values through international courts and justice,⁹ as echoed in the words of Mahmood Mamdani. He considered the International Criminal Court (ICC) to be a Western court established solely to try African crimes against humanity and as such, an assertion of neocolonial dominance.¹⁰ The relationship between Angola and Portugal is a more complex one that needs to be contextualized, as the ‘strong’ country is not the former colonial power and the ‘weak’ country is not the previous colony. In some ways there is a predominance of Angola in the relationship, due to the financial capacity of its leadership, despite the fact that this is counterbalanced by the know-how and expertise that Portugal still offers to Angola in several fields from engineering to law.¹¹ The position of Portugal since Angola’s independence has been a weak one. In fact, after losing its former colonies in 1975, Portugal almost went bankrupt three times¹² and is now permanently indebted. It needs constant financing, and one of the largest financiers of the Portuguese economy have been the Angolans.¹³ David Birmingham rightly emphasizes that Portugal became dependent on Angola’s investment and migration to survive its economic and financial crisis.¹⁴

The 2012 elections

Yachts, skyscrapers and cranes were again filling the bay of Luanda. After the scare of 2009 and the apparent recovery, 2012 seemed the ideal year for elections, as set out in the constitution. Theoretically, these elections, for the first time, would allow dos Santos to be chosen by the population as president of the Republic. In fact, it was not to be exactly like this. As mentioned previously, the constitutional regime established in the 2010 Constitution regarding the election of the powerful president was indirect. People vote for the party, and the first name in the party list for member of parliament will be elected president of the Republic. One way or another the very process of being elected would be a first for dos Santos.

Accordingly, the regime made considerable efforts to promote, both domestically and abroad, an image of modernity, good governance, national prosperity, and the general well-being of Angolans. In 2012 dos Santos assigned around US$40 million from his own presidential budget to spread a positive image of Angola throughout the world. One of the chosen vehicles for his regime’s campaign was CNN. The role of the CNN resulted in controversy, as it happened in Portugal with the pro-regime coverage by the TVI network. Kim Norgaard, at the time its South African delegation chief, made a visit to Luanda and met with the Angolan authorities to discuss the modalities of a series of TV reports to improve the regime’s image, focusing on the country’s economic growth. This sort of approach between a reputed international media network and a government like that of Angola was very much criticized by human rights activists. It was considered bizarre that a prominent international media group such as CNN would engage in formal agreements with a political regime about a country’s international news coverage because of the fundamental standards of independence and exemption to which it ought to adhere. The controversy worsened when the agreement detailing that the regime would pay US$17 million for advertising on CNN International¹⁵ became public.

Based on the situation of an economic recovery, once more with money, on good terms with international media, and building up a reputation for efficient management, especially in Sonangol,¹⁶ Angola advanced towards elections. Internally, cash was distributed among the population, although with copious ‘leaks’. Before the elections of August...

Table of contents

• Cover
• Half-Title
• Title
• Contents
• List of figure
• Acknowledgements
• List of acronyms
• Introduction and method
• Basic background: Post-war Angola. Reconstruction and ‘privatization of sovereignty’ (2002–10)
• Part I Dos Santos’s last moves (2010–17)
• Part II Transition and hope in Africa? (2017–20)
• Conclusions: Is this time different?
• Epilogue
• Selected bibliography
• Index
• Copyright