Transforming Angola: Strategies For Effective Governance

Angola has been marred by corruption, economic instability, and civil conflict for decades. The country's economy is heavily dependent on the oil sector, which has led to volatile growth and high levels of poverty and inequality. Despite being one of the richest countries in Africa, Angola is also one of the most indebted, with a debt-to-GDP ratio of 91%. The country's electoral system has been criticised for undermining voters' ability to elect political representatives effectively and hold them accountable. To reform the government of Angola, there is a need to address economic diversification, improve governance, enhance political representation, and ensure sustainable economic growth that benefits all citizens.

Reduce concentration of state resources in the hands of a small politically connected elite

Angola's wealth of natural resources, including large reserves of petroleum, natural gas, and diamonds, has led to a concentration of state resources in the hands of a small politically connected elite. This has resulted in widespread corruption, with Angola ranking 116th out of 180 countries in the 2022 Transparency International Corruption Perceptions Index. To reduce this concentration of state resources, the following measures could be implemented:

Firstly, it is essential to promote transparency and good governance. This includes strengthening the independence and capacity of judicial and law enforcement institutions to effectively investigate and prosecute corruption cases. Angola has taken steps in this direction, such as signing the UN Convention against Corruption and enacting comprehensive anti-corruption legislation. However, more needs to be done to ensure effective implementation and reduce the perception of corruption, which remains a significant impediment to foreign investment.

Secondly, diversifying the economy away from a reliance on oil and diamonds can help reduce the concentration of state resources. Angola's economy is highly dependent on oil exports, making it vulnerable to shifts in global oil prices. By encouraging investment in other sectors, such as agriculture, tourism, and renewable energy, the country can reduce the risk of economic shocks and empower a wider range of citizens to benefit from the country's resources.

Thirdly, addressing the issue of state capture is crucial. Private individuals and companies should not be allowed to exert undue influence over policies, regulations, and legislation for their personal gain. Strengthening regulatory bodies and ensuring their independence can help prevent state capture and promote fair competition. Additionally, increasing citizen participation in decision-making processes, such as through public consultations and hearings, can help hold government officials accountable and reduce opportunities for corruption.

Fourthly, improving the electoral system can help reduce the concentration of power. Angola's current electoral system, where voters elect the president, deputy president, and members of parliament simultaneously, undermines voters' ability to hold elected representatives accountable. Reforming the system to allow for the direct election of the president and proportional representation of political parties can enhance accountability and give citizens more control over their political representation.

Finally, promoting economic inclusion and reducing inequality are essential. Angola's wealth is highly concentrated, with 75% of the country's population living on less than $2 a day despite its middle-income economy status. By investing in education, healthcare, and social protection programs, the government can empower more citizens to participate in the economy and reduce the disparity between the politically connected elite and the rest of the population.

Improve transparency and reduce corruption

Angola has been marred by corruption and a lack of transparency for decades. The country's wealth is concentrated in the hands of a small, politically connected elite, and the government has been accused of state capture, with private individuals and companies influencing policies, regulations, and legislation for their own financial gain.

To improve transparency and reduce corruption, the following measures could be implemented:

Electoral Reform

Angola's unique electoral system, which involves voters electing the president, deputy president, and members of parliament simultaneously with a single mark on a single ballot, has been criticised for reducing voter choice and accountability. Reforming this system to allow for the direct election of the president and proportional representation of political parties could improve transparency and accountability by giving voters more power over their elected representatives.

Anti-Corruption Measures

The Angolan government has already taken steps to tackle corruption, such as creating a specialised anti-corruption unit and launching investigations into possible misappropriation of funds. However, more needs to be done to address the systemic nature of corruption in the country. This includes strengthening the independence of the judiciary, increasing transparency in public spending, and enforcing anti-money laundering legislation.

Economic Diversification

Angola's economy is heavily dependent on the oil sector, which has made it vulnerable to external shocks and undermined macroeconomic stability. By investing in other sectors, such as agriculture, the government can reduce this vulnerability and create more jobs, addressing high levels of unemployment, particularly among youth. Removing barriers to private sector investment and encouraging economic diversification can also help reduce poverty and inequality.

Strengthening Institutions

Angola's institutions, such as the Supreme and Constitutional Courts, remain weak and vulnerable to political influence. Depoliticising these institutions and strengthening their independence can improve transparency and reduce opportunities for corruption. Additionally, reforming the security services to be more professional and accountable can help improve the overall governance of the country.

International Cooperation

Increasing international engagement and aid can support Angola's reform efforts. The World Bank and IMF, for example, have been working with the Angolan government to improve economic management and governance. Additionally, Angola's collaboration with regional partners, such as in the Democratic Republic of Congo, demonstrates its commitment to peace and stability, which can attract further international support.

Reform the electoral system

Angola's electoral system is unique, but it has been criticised for undermining voters' ability to elect political representatives effectively. The current system involves voters electing the president, deputy president, and members of parliament simultaneously with a single mark on a single ballot paper. This prevents voters from splitting their votes for the presidency and parliament, forcing them to choose a president and deputy president from the party with the majority in the national assembly.

To reform the electoral system, the following changes could be implemented:

Direct Election of the President

One of the main issues with the current system is that it does not allow for the direct election of the president. Angola has a presidential system of government, where the executive branch exercises power without effective checks and balances. In such a system, it is crucial for the executive to derive its legitimacy directly from the voters, rather than through the legislature. Therefore, a reformed electoral system should provide for the direct election of the president by the voters. This would give the president a clear mandate from the people and increase their accountability to the electorate.

Representation of Angolan Communities Abroad

The reformed electoral system should also include representation for Angolan communities living abroad. This would ensure that the interests and perspectives of the Angolan diaspora are taken into account in the country's political process. This was previously stipulated in the Constitutional Law of the Republic of Angola, an interim document revoked in 2010. Reinstating this provision would strengthen the connection between Angola and its citizens living overseas.

Scrapping of Provincial-Level Constituencies

Currently, Angola has a two-level constituency system, with 18 provincial constituencies in addition to a national constituency. However, this does not make sense given that Angola is a unitary state with a unicameral parliament. The existence of provincial-level constituencies is premised on the idea that all provinces need representation at the national assembly, but this is not necessary or practical. Therefore, the reformed electoral system should scrap the provincial-level constituencies and adopt a single national constituency. This would simplify the electoral process and ensure that all parliamentarians represent the whole nation, rather than specific provinces.

Direct Election of Deputies and Proportional Representation of Political Parties

To promote accountability and ensure the proportional representation of political parties, the reformed electoral system should include a constituency element for the direct election of deputies. This would allow voters to elect their representatives directly from their constituencies, making them more accountable to the people they represent. Additionally, compensatory seats should be introduced for political parties in proportion to their share of the votes. This would ensure that the legislature reflects the diversity of political opinions and parties in the country.

Overall Impact of the Reforms

By implementing these changes, Angola would move towards a mixed electoral system that combines the direct election of representatives with proportional representation. This system would address the current accountability deficit in the political process, as representatives would be directly elected by the voters and linked to specific territorial constituencies. Additionally, it would ensure that the legislature accurately represents the political makeup of the country, giving a voice to minority parties. Overall, these reforms would enhance the quality of Angola's representative democracy and empower voters to hold their elected officials accountable.

Reduce the country's dependence on the oil sector

Angola's dependence on the oil sector has left the country vulnerable to external shocks and undermined its macroeconomic stability. To reduce this dependence, the country needs to invest in sectors other than oil to achieve economic diversification and support growth, job creation, and poverty reduction. Here are some ways Angola can reduce its dependence on the oil sector:

Agriculture

Angola has abundant agricultural and arable land, favourable climatic conditions, and a growing population, making agriculture a promising sector for diversification. Angola used to be a significant exporter of coffee and other agricultural products, and there is potential to revive this industry. The country also has the opportunity to develop its honey production, which the government sees as a product that could help diversify the economy. Angola's abundance of arable land and freshwater, along with its growing population and increasing demand for food and beverages, make this sector attractive for foreign direct investment (FDI).

Mining

The mining industry is a key priority for Angola in the short term, especially as demand for mineral resources increases. Angola holds significant reserves of diamonds, iron ore, phosphates, copper, gold, manganese, marble, granite, and quartz. The country also plans to kick off niobium exploitation in the Huíla province. The government has implemented several measures to attract investors to the mining sector, including the setup of the National Agency for Mineral Resources and the Angolan Diamond Exchange Market, and the enactment of the new Governance Model for the Mining Sector. These initiatives have already started to attract investors to the country.

Aviation and Transport Infrastructure

The aviation sector has caught the eye of the Angolan government, which has devised a strategy to promote the sector's growth, secure foreign direct investment, and improve operational safety. The government is also committed to developing port infrastructures and logistics, having recently signed a $190 million 20-year concession agreement with DP World, an Emirati multinational logistics company, for the operation of the multipurpose terminal at the Port of Luanda.

Renewable Energy

Angola has ambitious plans for its renewable energy sector, aiming to increase access to electricity to 60% of the population by 2025, with 70% of electricity derived from renewable sources. The government has sought assistance from the Sustainable Energy Fund for Africa (SEFA) to develop and implement a regulatory and institutional framework to boost private investment in renewable energy generation. Angola also has the potential to develop green hydrogen, which could be another opportunity to boost its renewable resource wealth.

Privatisation

Angola's ongoing privatisation programme (PROPRIV) will contribute to increased FDI levels and boost the local M&A sector. Over 170 state-owned enterprises and assets will be privatised by 2022, including strategic national reference companies such as Unitel, Angola Telecom, and Angola Cables.

Improve the business environment

Angola's business environment has seen significant improvements in recent years, but it still faces challenges that limit private investment and hinder economic diversification. Here are some measures that can be taken to further improve the business environment in Angola:

Improve access to private credit

Developing a credit registry to facilitate guarantees and boost mobile banking can help improve access to private credit for businesses. This will enable businesses to obtain the necessary funds to invest in their operations and expand their activities.

Promote investment in infrastructure and human capital

The public and private sectors should work together to promote investment in infrastructure and human capital in a complementary and sustainable manner. This includes investing in education and skills development to address the issue of low skills and human capital in the country.

Reduce bureaucratic and licensing procedures

Simplifying and digitizing bureaucratic and licensing procedures can help reduce the time and effort required for businesses to navigate these processes. Streamlining approval times and cutting red tape, as demonstrated by the National Agency for Oil, Gas and Biofuels (ANPG), can make it easier for businesses to operate and expand in Angola.

Strengthen good governance practices

Good governance practices, such as greater transparency in financial management and public procurement, are essential for improving the business environment. Strengthening the capacity and efficiency of the judicial system in handling corruption cases can also help deter corruption and improve the overall business climate.

Diversify the economy

Angola's heavy dependence on the oil sector has made it vulnerable to external shocks and undermined macroeconomic stability. Investing in other sectors, such as agriculture, can help diversify the economy, create jobs, and reduce poverty.

Enhance macroeconomic stability

Measures such as a more flexible exchange rate regime, central bank autonomy, sound monetary policy, and fiscal consolidation have already contributed to improved macroeconomic stability in Angola. Continuing to implement such policies can help create a more stable and predictable environment for businesses to operate and make long-term investments.

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