Economy of Angola
| File:AGO006.JPG | |
| Currency | Kwanza (AOA) |
|---|---|
| Calendar year | |
Trade organisations | AU, WTO |
| Statistics | |
| GDP | $51.95 billion (2006) |
GDP growth | 14%[1] (2006) |
GDP per capita | $4,300 (2006) |
GDP by sector | agriculture (9.6%), industry (65.8%), services (24.6%) (2005) |
| 13.2% (2006) | |
Population below poverty line | 70% (2003) |
Labour force | 70% (2003) |
Labour force by occupation | agriculture (85%), industry and services (15%) (2003) |
| Unemployment | "extensive unemployment and underemployment affecting more than half the population"[1] (2001) |
Main industries | "petroleum, diamonds, iron ore, phosphates, feldspar, bauxite, uranium, gold, cement, basic metal products, fish processing, food processing, brewing, tobacco products, sugar, textiles, and ship repair"[1] |
| External | |
| Exports | $35.53bn (2006) |
Export goods | "crude oil, diamonds, refined petroleum products, gas, coffee, sisal, fish and fish products, timber, cotton"[1] |
Main export partners | U.S. 39.8%, the People's Republic of China 29.6%, France 7.8%, Chile 5.4%, Taiwan 4.4% 2005) |
| Imports | $10.21bn (2006) |
Import goods | "machinery and electrical equipment, vehicles and spare parts, medicines, food, textiles, military goods"[1] |
Main import partners | South Korea 20.5%, Portugal 13.4%, US 12.5%, South Africa 7.4%, Brazil 7%, France 5.1%, China 5% (2005) |
| Public finances | |
| 32.7% of GDP (2006 | |
| Revenues | $10.98bn (2006) |
| Expenses | $9.7bn (2006) |
| Economic aid | $383.5 million (1999) |
All values, unless otherwise stated, are in US dollars. | |
Angola is the fastest-growing economy in Africa, largely due to a major oil boom, but it also ranks in the bottom 10 of socioeconomic conditions in the world. Aside from the oil sector and diamonds, it is in economic disarray because of 26 years of nearly continuous warfare. Despite abundant natural resources, output per capita remains among the world's lowest. Subsistence agriculture and dependence on humanitarian food assistance sustain the large majority of the population. Little industry exists.
Macro-economic trend
This is a chart of trend of nominal gross domestic product of Angola (since unification) at market prices using International Monetary Fund data[2]; figures are in millions of units.
| Year | US Dollars | Kwanza |
|---|---|---|
| 1995 | 5.066 | 14 |
| 2000 | 9.135 | 91,666 |
| 2005 | 28.860 | 2,515,452 |
By contrast, the rapidly expanding petroleum industry now producing up to 800,000 barrels (127,000 m³) per day, behind only Nigeria in Africa, accounts for more than 60% of GNP and 90% of government revenues. Oil production remains largely offshore and has few linkages with other sectors of the economy. Block Zero, located of the enclave of Cabinda, provides the majority of Angola's crude oil production. There, ChevronTexaco, through its subsidiary Cabinda Gulf Oil Company, is the operator with a 39.2% share, with SONANGOL (the Angolan state oil company), Total, and ENI-Agip splitting up the rest. ChevronTexaco also operates Angola's first producing deepwater section, Block 14, which started pumping in January 2000. The U.S. takes more than half of Angola's production, by far the largest importer. Exports to Asian countries have grown rapidly in recent years, especially the People's Republic of China. Significant discoveries have been made on deepwater Blocks 15, 17, 18, and 24, with ExxonMobil, BP, Statoil, Norsk Hydro, and Agip having major interests. Total operates Angola's one refinery (in Luanda) as a joint venture with SONANGOL; plans for a second refinery in Lobito are moving forward.
In the last decade of the colonial period, Angola was a major African food exporter but now is forced to import almost all its food. Because of severe wartime conditions, including extensive planting of landmines throughout the countryside, agricultural activities have been brought to a near standstill. Some efforts to recover have gone forward, however, notably in fisheries. Coffee production, though a fraction of its pre-1975 level, is sufficient for domestic needs and some exports. In sharp contrast to a bleak picture of devastation and bare subsistence is expanding oil production, now almost half of GDP and 90% of exports, at 800,000 barrels (127,000 m³) a day. Diamonds make up most of the remaining exports--and have provided much of the revenue for Jonas Savimbi's UNITA rebellion through illicit trade. Other rich resources await development: gold, forest products, fisheries, iron ore, coffee, and countless fruits.
An economic reform effort was launched in 1998. In April 2000, Angola started an International Monetary Fund (IMF) Staff-Monitored Program (SMP). The program formally lapsed in June 2001, but the IMF remains engaged. In this context, the Government of Angola has succeeded in unifying exchange rates and has raised fuel, electricity, and water rates. The Commercial Code, telecommunications law, and Foreign Investment Code are being modernized. A privatization effort, prepared with World Bank assistance, has begun with the BCI bank. Nevertheless, a legacy of fiscal mismanagement and corruption persists.
Angola is the third-largest trading partner of the United States in Sub-Saharan Africa, largely because of its petroleum exports. The U.S. imports about 4% of its oil from Angola, a share which should continue to increase. By the same token, U.S. companies account for more than half the investment in Angola, with Chevron-Texaco leading the way. The U.S. exports industrial goods and services--primarily oilfield equipment, mining equipment, chemicals, aircraft, and food--to Angola, while principally importing petroleum.
Economy - overview: Angola is an economy in disarray because of a quarter century of nearly continuous warfare and corruption. Despite its abundant natural resources, output per capita is among the world's lowest. Subsistence agriculture provides the main livelihood for 85% of the population. Oil production and the supporting activities are vital to the economy, contributing about 45% to GDP and 90% of exports. Notwithstanding the signing of a peace accord in November 1994, violence continues, millions of land mines remain, and many farmers are reluctant to return to their fields. As a result, much of the country's food must still be imported. To take advantage of its rich resources - gold, diamonds, extensive forests, Atlantic fisheries, and large oil deposits - Angola will need to implement the peace agreement and reform government policies. Despite the increase in the pace of civil warfare in late 1998, the economy grew by an estimated 4% in 1999. The government introduced new currency denominations in 1999, including a 1 and 5 kwanza note. Expanded oil production brightens prospects for 2000, but internal strife discourages investment outside of the petroleum sector.
Angola's economy has undergone a period of transformation in recent years, moving from the disarray caused by a quarter century of war to being the fastest growing economy in Africa and one of the fastest in the world. In 2004, China's Eximbank approved a $2 billion line of credit to Angola. The loan is being used to rebuild Angola's infrastructure, though it has also limited the influence of the International Monetary Fund in the country.[citation needed] Growth is almost entirely driven by rising oil production which surpassed 1.4 million barrels per day in late-2005 and which is expected to grow to 2 million barrels per day by 2007. Control of the oil industry is consolidated in Sonangol Group, a conglomerate which is owned by the Angolan government. The economy grew 18% in 2005; growth is expected to reach 26% in 2006 and stay above 10% for the rest of the decade. The security brought about by the 2002 peace settlement has led to the resettlement of 4 million displaced persons, thus resulting in large-scale increases in agriculture production. With revenues booming from oil exports, the government has started to implement ambitious development programs in building roads and other basic infrastructure for the nation.
References
- ^ a b c d e "Angola". CIA World Factbook. Central Intelligence Agency. Retrieved 2007-01-22.
- ^ "Report for Selected Countries and Subjects". International Monetary Fund. 2006. Retrieved 2007-01-22.
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