Angola, the wrong example?

China is Angola’s main trading partner, but there are many voices challenging the projects conducted in China that do not bring value. Even the sand is bought from the Chinese, by the Chinese. 

MB May 2020 Special Report | Forum Macau: 17 years, old enough?  

China is Angola’s main trading partner, leading exports and imports. Angola is the main recipient of Chinese financial aid in Africa. China is the main importer of Angolan crude. China has become the largest foreign investor in Angola, with 200,000 workers and dozens of companies installed throughout the country. 

The truth is that none of this happened because of the Forum Macau, but maybe if some of the business had been ‘brokered’ through this institute, things could have been different. 

The problem arises from the moment that it is realized that Chinese companies hardly contribute to the Angolan production chain, importing everything they need or subcontracting services to other Chinese companies already installed in Angola. 

“Chinese companies do not like to buy from Angolan companies at all. They buy from each other and obviously this doesn’t interest us, we are creating a growing chain of dependence”, says the president of the Industrial Association of Angola, José Severino. 

“They [Chinese companies] transport the sand, they buy the gravel, this cannot be. It is back to an external dependency; we did not accept the continuation of these procedures. On the other hand, they have procedures that are illegal, these Chinese companies, in general are not even legalized, do not pay taxes. This is unfair competition “, says the industrialist. 

“Friends of Angola for us, we are increasingly dependent on them, it is not friendship, it is business and must be treated as such”, insists the same official. 

The problem is not just from Angola, since China has disseminated this type of aid across all the continent, but according to the China-Africa Research Initiative, of the American University Johns Hopkins, Angola has been the main recipient of this financial aid, attracting US$42.8 billion in Chinese credit between 2000 and 2017. 

China’s encouragement of contracting of turn-key projects and African governments seems to support this option in general. 

As a consequence, a project is designed in any Beijing office (or, in this case, in another country or city) and arrives at the destination ready to be executed. 

The example of the Government Palace of Guinea-Bissau, opened in 2010, has often been given. It was designed by Chinese architects who, it is said in Guinea, thought it was snowing in Bissau … 

The transplantation of projects coming from China without taking care to adapt them to the local reality, namely the bet on cement skyscrapers to accommodate populations used to a more rural life, is another example that is usually mentioned in this context. 

With the new President already in office, it was learned this year that the Angolan Attorney General’s Office seized more than a thousand unfinished properties, as well as buildings and shipyards constructed with public funds that were in the possession of the China International Fund. After some months earlier, the same Attorney General’s Office announced the recovery of 262 million euros to the same consortium, as the managing entity for the construction project for the new Luanda International Airport. 

Ports of problem 

China is involved in eight port projects in Portuguese-speaking countries, either as a construction company or through funding, says a survey by the Center for Strategic International Studies (CSIS). 

Those eight ports are part of a total 46 operated port projects, built or financed by China, across Africa. 

As CSIS report underlines, currently China is not an operator of any port facility but the situation is going to change with the announced project of the port of Mindelo in Cabo Verde. 

Furthermore, in the Gulf of Guinea, the announced deep water port of Fernão Dias in São Tomé and Príncipe is expected to have Chinese investment and construction, according to the CSIS survey. 

The work of researchers Judd Devermont and Catherine Chiang identifies three projects in Angola: the port of Caio and the port of Cabinda, both in Cabinda, and the expansion of the port of Lobito. 

“Chinese investments in sub-Saharan African ports present potential threats  to  US influence in sub-Saharan Africa as well as African sovereignty,” states the report