Spend any time in Luanda, Angola’s bustling capital, and the first thing that hits you is the sharp disparities in wealth.
Driving around the city, I was struck by the contrast between the gleaming skyscrapers and the neighbouring shanty towns and dilapidated housing projects.
The divisions are becoming more acute as the downturn in the oil price has left the government strapped for cash. Public sector salaries haven’t been paid for months. And there are big problems with refuse collection – you can’t help but notice the piles of rubbish. This has sparked concern over public health, with Malaria on the rise and even outbreaks of Yellow Fever.
The mood among the legions of expats working in the once booming energy industry is gloomy as companies lay off thousands of staff. For years, those based in the capital put up with the traffic congestion and high rates of crime. Now with uncertainty hanging over their jobs, many foreign workers wonder whether it is time to leave.
Those in it for the long term worry about political stability. One of their main concerns is the presidential succession. Jose Eduardo dos Santos’ long reign is coming to an end. But will the transition of power be managed well? The recent appointment of his billionaire daughter, Isabel, as the head of the massive state oil company, Sonangol, has led to speculation that she is being groomed for the presidency. There may yet be a tug-of-war within the ruling People’s Movement for the Liberation of Angola (MPLA) over the eventual choice, but the party wields such control over the country the opposition is unlikely to put up a challenger.
The government these days is less concerned about its opponents than the army of currency hawkers on the streets of the capital. Their number has mushroomed with the dollar’s growing black market value. They are so bold that you even see them outside the banks, scattering when the police turn up.
With the country’s finances in a mess, the government is counting on economic diversification but there may be too many conflicts of interest for this to succeed. Sonangol will have to sell off its non-core assets, as they dominate the economy, crowding out private investors. However, there may be resistance to them being sold or restructured because they are an important source of revenue for members of the elite.
Angola is facing uncertain times. With its oil-fuelled wealth beginning to fade, it remains to be seen whether the country is capable of meeting the new economic challenges.
