Angola is a lower middle-income country located in southern Africa with a USD 124.5 billion GDP, a per capita income of USD 4,418 according to 2018 IMF estimates, and an estimated 29.3 million population. Angola is a member of OPEC and produces an average of 1.63 million barrels per day, the second highest volume in the sub-Saharan region behind Nigeria. Angola also holds significant proven gas reserves as well as extensive mineral resources. The oil price slide that started in mid-2014 substantially reduced Angola’s fiscal and export revenue in 2016, but oil export revenue in 2017 jumped back to 2015 levels, estimated at USD 31.2 billion. Inflation dropped to an estimated 26 percent in 2017 from a high of 45 percent in 2016, as a result of stronger fiscal and monetary controls by the Government of Angola.
Angola experienced its first political and peaceful transition of government in August 23, 2017 with the election of Joao Lourenco as Angola’s new president after 38 years of rule by Jose Eduardo dos Santos. President Joao Lourenco has emerged as the most popular political figure in Angola, revitalizing support for the ruling MPLA and slowly improving Angola’s international image as a result of his sweeping reform agenda and eagerness to engage with the international community. He has won greater investor confidence by removing the former President’s children and incompetent bureaucrats from key government positions.
The new Lourenco administration has identified economic diversification and increasing U.S.-Angola bilateral cooperation as priorities. President Lourenco announced the United States as first among Angola’s desired bilateral partners, which include Russia, China and Brazil, and has called on the U.S. private sector to assist in transforming Angola’s economy through increased foreign investment. A new series of reforms, including a new visa issuance policy, aim at opening up the country to tourism and new investments, and to improve the overall business climate. In May 2018, with input from the private sector, the government approved a new private investment law. The new law eliminates the local partnership requirement for foreign investors, and offers greater business facilitation and tax incentives for investors. The government has also created the Agency for Investment and Promotion of Exports of Angola (Agencia de Investimento e Promocao de Exportacoes de Angola – AIPEX), a single body to promote investments and exports and the international competitiveness of Angolan companies.
The government is focusing on building infrastructure capacity in the areas of electricity, water, and transportation. The expansion of the Cambambe Dam and the construction of the Lauca Dam (slated for completion in mid-2018), doubled Angola’s electric power generation capacity. Multilateral development banks hold an important role in Angola’s infrastructure revitalization with the African Development Bank financing electric sector reform and the World Bank concentrated on water sector expansion. Angola has also worked with the U.S. Power Africa program to identify project and investment opportunities in the power sector. Angola will open a USD 6 billion new international airport funded by a Chinese credit facility and is slated to accommodate 13 million passengers annually as of October 2020. Continued infrastructure development opportunities are most obvious in the areas of public transport, port rehabilitation, energy and power, telecommunications, mining, natural gas, and in creating national oil refining capacity.
Key sectors that have attracted significant regional and international investment in the country include energy, construction, and oil and gas. Non-oil economic sectors such as agriculture, energy, and extractives will open up new areas to foreign and national investment. As the country continues to seek to diversify its economy, an emerging sector is the agricultural sector for which the country lacks technical knowhow and the necessary startup capital resources to develop. Agriculture represents only 11 percent of GDP. Angola has decided to open up its telecoms market in a bid to attract foreign capital.
Key Issues to watch:
- Angola continues to suffer from a relatively poor investment climate due in large part to the lack of openness to competition in the private sector and the dominance of the state or state owned enterprises in the economy.
- Angola benefits from a relatively stable and predictable political environment, especially when compared to its neighbors in the region. Peaceful transition following presidential elections in 2017, resulting in new leadership after 38 years of Jose Eduardo dos Santos rule, has raised local and international expectations for change.
- Angola is rich in natural resources including oil, minerals, land, and water.
- There is an abundant supply of unskilled labor, particularly in the capital Luanda. Skilled professionals are available, but often require additional training.
- Portuguese is commonly spoken, while English competency levels are relatively low.
- The new private investment law that replaces Law 14/15 of 11 August 2015 provides greater tax incentives to companies investing in the domestic economy, does away with the local partnership requirements for foreign investment and ends minimum levels for investment.
- Real estate and living expenses remain expensive, but have recently moderated due to the ongoing economic crisis. In 2017, Luanda was named the most expensive city for expatriates across Africa and globally, up from second in 2016, despite its currency weakening against the U.S. dollar.
- Infrastructure is limited, roads are often in poor condition, power outages are common, and water availability can be unreliable.
- The investment climate is also heavily hampered by rampant corruption, and a complex, opaque regulatory environment, as reflected by rankings from globally recognized entities outlined in Table 1.
- Despite the slight upswing in global oil prices in 2017, the oil crisis continues to affect the Angolan economy, creating drastic losses in export revenue and a severe limitation in foreign exchange, forcing substantial cuts in government spending.
- Angola’s high external imbalances and foreign exchange shortages have hurt private sector growth, and already rapidly declining foreign currency reserves. However, the government approved a law on February 23, 2018 providing amnesty to any citizen and legal entity voluntarily repatriating foreign held financial resources within a period of 180 days following the date of entry into force of the law, June 26, 2018.
- Repatriation of capital, dividends and transfers of remittances abroad remain challenging.
- Portfolio investment in Angola is negligible.
Although only 23 percent of Angola’s entrepreneurs are women, Angola boasts one of the highest growth rates of female entrepreneurs in Africa. However, the government has not instituted any significant reforms to increase the percentage of female entrepreneurs and limited access to credit remains a significant impediment to entrepreneurship in general.
|TI Corruption Perceptions Index||2017||167 of 180||https://www.transparency.org/country/AGO|
|World Bank’s Doing Business Report “Ease of Doing Business”||2018||175 of 190||www.doingbusiness.org/rankings|
|Global Innovation Index||2017||N/A||https://www.globalinnovation
|U.S. FDI in partner country (M USD, stock positions)||2017||USD 780||https://www.bea.gov/international/
|World Bank GNI per capita||2016||USD 3450|
1. Openness To, and Restrictions Upon, Foreign Investment
Policies Toward Foreign Direct Investment
Angola’s business environment remains one of the most difficult in the world. Investors must factor in pervasive corruption, an underdeveloped financial system, loss of U.S. corresponding banking relationships, abundant but unskilled labor, and extremely high operating costs. Surface transportation inside the country is slow and expensive, while bureaucracy and port inefficiencies complicate trade and raise costs.
The GRA actively seeks FDI, although it has traditionally set barriers to protect domestic businesses. The new 2018 private investment law, approved by Presidential decree 10/18 of 26 June 2018, removes obstacles that render the country’s business climate challenging and a deterrent to investors. The new investment law recognizes that prospective investors need a regulatory environment that guarantees contract enforcement and the repatriation of earnings. The biggest change within the new law is on how the government treats foreign investors versus domestic investors. The other more significant changes include:
- The scope: The new law applies to all national and foreign private investments, irrespective of the investment amounts.
- Eligibility for tax and customs benefits/incentives and other facilities: The new law does not subject investors to minimum investment thresholds. However, future regulations and/or amendments to the law may set limitations.
- Local content: Local content restrictions were eliminated (except for those originating from industry specific legal statutes, such as on oil & gas, mining, banking and financial services, aviation, and shipping).
- Transfer of profits and dividends: foreign investors remain entitled to repatriate dividends or profits distributed, the proceeds from liquidation of their investments (capital gains included), the amounts resultant from indemnities, royalties or other indirect investments associated with technology transfers; the right to repatriate depends on the full implementation of the investment and full compliance with tax obligations.
- Surtax on Capital Investment: tax levied on the portion of dividends exceeding the investor’s capital contributions in local SPVs (formerly ranging from 15 percent to 50 percent) was abolished.
- Priority Sectors: agriculture, food & agroindustry; health care units and related services; reforestation and industrial processing of forest resources, forestry; textile, clothing & footwear (TCF); lodging, tourism & leisure; civil construction & public works, telecoms & IT, airport and railway infrastructures; power production and supply; education, professional and educational training, scientific research and ID; water supply and waste collection and management.
- Indirect Investment: capital and finance investments in shares and debt securities was added to shareholders loans, supplementary capital contributions, proprietary technology, technical processes, industrial secrets and models, franchising, registered trademarks and other forms of access to their use; indirect investment remains capped at 50 percent of the overall investment amount.
- Shareholders loans: capped at 30 percent of the overall investment, reimbursable only after 3 years.
- Financing: foreign investors and companies majority owned by foreign investors are only eligible to take domestic financing upon full implementation of their investment projects.
- Financial Benefits: new concept which includes governmental financing programs (micro funding, privileged interest rates, public collaterals and risk capital) and administrative support (simplified and privileged access to business and operational licenses or assets of private domain of public entities).
- Reinvestment: special benefits awarded to reinvestment projects, in terms still to be regulated.
- Procedural regimes: investors are free to opt by one of the following regimes:
- Prior-declaration Regime: applicable to investments not falling within the scope of priority sectors; investors may incorporate their local entities prior to the filing of investment proposals.
- Special Regime: applicable to investments in priority sectors; SPVs incorporated under this regime are exempted from payment of taxes and fees (customs duties included) for a period of up to 5 years.
- Zones of Investment: Defines four territorial investment-developing zones for tax and customs incentives purposes.
- Tax and Customs Incentives: tax incentives vary depending on a number of criteria, including investment procedural regime followed, nature of the tax (conveyance tax, industrial tax, investment income tax or stamp duty) and investment zone; tax savings can amount to up to 85 percent (for stamp duty) and be granted up to 8 years.
- Fines: 1 percent of the investment amount (other ancillary penalties may also apply).
- Effective date and Implementation: the 2018 PIL entered into force on the date of its gazette, but its effective implementation depends on the enactment of future regulations, which are due soon.
Angola’s Regulatory Competition Agency submitted its first anti-trust law that was also approved on May 17. The new competition law aims to ensure and safeguard sound competition practices in the award and enforcement of contracts. In addition to changes to the investment legal framework, the government has created the Agency for Private Investment and Export Promotion (AIPEX), a single state-run agency with the goal of facilitating investment and export processes. The government abolished the visitor visa requirement for several countries in the region, and as of March 30, 2018, it began issuing tourism visas on arrival at the airport to citizens from 61 countries, including the United States, China, and the European Union. For other countries, a series of measures are in development to expedite the issuance of tourist and business visas, a historically difficult process that has been a major complaint from international companies, expatriate workers, and investors.
Under the new 2018 investment law, the compulsory 35 percent minimum local participation requirement set by the 2015 investment law, ceases to be a requirement and investors are free to decide their investment capital threshold, share capital structure and request incentives.
Investment in the petroleum, diamond, and financial sectors are governed by sector-specific legislation. Details on the petroleum investment guidelines are outlined in the Country Commercial Guide Best Prospect Summary of the Oil and Gas industry.
Angola’s foreign exchange laws require all companies operating in Angola to make payments through local (Angola-domiciled) banks using the Angolan currency (kwanza). The foreign exchange law aims to strengthen demand for the kwanza, and build the capacity of Angola’s underdeveloped financial sector. The law was implemented in two phases. First in 2012, oil companies were required to pay taxes owed to the Angolan Ministry of Finance through a local bank. Then in July 2013, the regulation expanded to all companies operating in Angola, requiring them to use local banks (and local currency) for all payments, including payments to suppliers and contractors domiciled abroad.
Foreign exchange availability in the market during 2017 averaged USD 1 billion per month, up from USD 890.5 million per month in 2016. Foreign exchange availability in 2017 met only 63 percent of demand. Foreign exchange availability has been on the upswing in early 2018, as the National Bank of Angola (BNA) sold approximately USD 1.8 billion from January to March, 2018 to commercial banks. Despite the increase compared to 2017 in available forex, Angolan companies report waits of 3-8 months to access foreign exchange for imports. The government prioritized the following areas for forex: 1) employment retention (raw materials and inputs, equipment, technician salaries, and oil sector operations); 2) inflationary control (food, consumer necessities, fuel); 3) health and education; and 4) priority government expenses for necessary operations.
When preparing and entering into contracts with Angolan entities, foreign investors generally ensure that contracts are not governed solely by Angolan laws. This measure is to avoid the accompanying government mandate that contracts be denominated and paid in kwanza, the local currency which has little commercial or practical use outside of Angola. Companies often find it advisable to seek appropriate legal advice prior to negotiating binding law, arbitration, and payment clauses, and to seek to ensure that contract payments are denominated in and made in U.S. dollars. Consequent to the drop in global oil prices, the mainstay of the Angolan economy, foreign companies with kwanza based contracts have found it extremely difficult to repatriate profits due to the Central Bank’s severe restrictions on forex.
The 2018 investment law seeks to reduce bureaucracies and eliminate arcane legal complexities of the Angolan business environment. The new law also seeks to give equal treatment to all companies tendering for government contracts for goods, services, and public works. Regardless of origin, all companies can benefit from the Angolan Government’s loan guarantees, generous terms, and subsidized interest rates of the Ministry of Economy’s Angola Invest USD 1.6 billion Angola Invest Program. However, in 2018, the Angola Invest Program suffered a 27 percent drop in allocation in the State Budget to support micro, small, and medium-sized enterprises.
FDI in Angola has steadily increased since the end of the civil war in 2002, but peaked in 2014 just before the oil led economic crisis. Angola’s Central Bank, the Banco Nacional de Angola (BNA) reported USD 16.5 billion of FDI in Angola in 2014, which declined to USD 14.4 billion in 2016, and further in 2017 to an estimated USD 8.5 billion. The latest figures indicate that U.S. Direct Investment in Angola rose to USD 804 million in 2016 from USD 239 million in 2015, according to the U.S. Department of Commerce’s Bureau of Economic Analysis (www.bea.gov/international/factsheet/factsheet.cfm ).
President Lourenco began a concerted effort to restore investor confidence by prioritizing anti-corruption and the fight against nepotism. He has dismissed a number of prominent Angolan figures from government ministries and state owned institutions, called for the re-structuring of state owned enterprises, and has dismantled a series of monopolies in the industrial and media space controlled by members of the former president’s family. He dismissed the former president’s daughter, Isabel dos Santos, as head of Sonangol, the state-owned oil company, and removed dos Santos’ son from his position as Chair of the USD 5 billion valued Sovereign Wealth Fund. Lourenco put new executive boards in place that are charged with developing plans to improve operations and accountability in State Owned Enterprises. These reforms have attracted considerable international attention.
Limits on Foreign Control and Right to Private Ownership and Establishment
With the new 2018 investment law, Angola’s limits on foreign equity participation will substantially reduce, bringing it more in line with those of its sub-Saharan African neighbors. Foreign ownership will remain limited to 49 percent in the oil and gas sectors, 50 percent in insurance, and 10 percent in the banking sectors. The Angolan government eliminated the 35 percent local content requirement in foreign investments, and it offers incentives to companies investing in the domestic economy, while maintaining minimal FDI screening processes. There are several objectives that the GRA seeks to accomplish through its FDI screening process: 1) create jobs for Angolans or transfer expertise to Angolan companies as part of the “Angolanization” plan; 2) protect sensitive industries such as defense and finance; 3) prevent capital flight or any other behavior that could threaten the stability of the Angolan economy; and, 4) diversify the economy.
Other Investment Policy Reviews
Angola has been a member of the World Trade Organization (WTO) since 1996. There have been no investment policy reviews for Angola from either the Organization for Economic Cooperation and Development (OECD) or the United Nations Conference on Trade and Development (UNCTAD) in the last four years. The World Trade Organization (WTO) performed a policy review of Angola in September 2015. Excerpts of the Trade Policy Review concluding remarks by the WTO Chairperson were as follows:
“Members noted that Angola had implemented a number of measures aimed at import substitution. Its applied tariff rates have been significantly increased and range from 2 percent to 50 percent, with a simple average of 10.9 percent (up from 7.4 percent in 2005). Members urged Angola to rectify the instances where applied tariff rates and other duties and charges exceed the corresponding bound levels. In lieu of import substitution, Members suggested that Angola reduce production costs through lower import tariffs on inputs and further trade facilitation measures with a view to enhancing competitiveness and promoting local production.”
Members welcomed Angola’s new mining code and sought information about opportunities for foreign operators. They sought clarifications about Angola’s agricultural policy, which deals with food security and aims for sustainability of its fisheries sector. Some participants inquired about Angola’s plans to broaden its General Agreements on Trade in Services (GATS) commitments beyond its three existing sectors. Members were also interested in the Government’s priorities regarding, inter alia, competition policy, Sanitary and Phytosanitary (SPS) and Technical Barriers to Trade (TBT) regimes, and state-trading and state-owned enterprises. Noting that Angola’s intellectual property regime had not been substantially updated since 1992, Members urged the country to implement the TRIPS Agreement and to broaden its participation in international conventions on intellectual property. The Government of Angola plans to introduce a new tariff schedule in 2018.
Angola made dealing with construction permits easier and less time-consuming by improving its system of permit applications, according to the World Bank. The World Bank Doing Business 2018 report ranked Angola 175 out of 182 countries and also recorded an improvement in Luanda’s electrical grid and overall access to electricity, and the government’s facilitation of border trade by improving infrastructure at the Port of Luanda. Launching a business typically requires 36 days, compared with a regional average of 27 days. In 2012, the government opened approximately twenty “Balcoes Unicos do Empreendedor” (Single “One stop” Shop for Entrepreneurs). In addition to the Balcoes Unicos process, new business owners must also complete processes at the Ministry of Commerce, the tax office, and a provincial court in the location where the business has its headquarters.
On March 13, 2018, the government replaced the Angolan Investment and Export Promotion Agency (APIEX) with a new agency, the Private Investment and Export Promotion Agency (AIPEX). The new agency will now serve as a one-stop shop to promote investments and exports and the international competitiveness of Angolan companies.
The government also amended the 2015 private investment law. The current 2018 investment law eliminates the obligation to establish a partnership with an Angolan entity with at least a 35 percent stake in the capital structure in order to implement projects in the electricity and water, tourism, transport and logistics, construction, media, telecommunications, and IT sectors. As for the mineral and petroleum sectors, a legal document approving the Legal and Tax Regime for the Development of Marginal Discoveries of Petroleum Resources is also in the approval process.
Presidential Decree 56/18, of February 20, 2018 exempts several regional countries from entry visas, and as of March 30, 2018, the government is granting visas upon arrival to 61 countries including the United States and European Union.
Under the new 2018 investment law, the government reserves approval of investments of up to USD 10 million by the Agency for Private investment and Exports (AIPEX). The process can be time consuming and difficult to navigate, thus it is strongly recommended to retain legal counsel to assist in the investment application process.
The following documents are required to launch an investment:
- Letter of Investment Proposal addressed to the Minister of Commerce (MINCO);
- A Power of Attorney or Delegation of Authority to represent the investment proposal (in case you are not principal);
- Presentation Template Model of the Project, Dully Completed;
- Copy of the legal documentation of the company (company status), commercial registry duly authenticated by the consular services of Angola at the country of company domicile in case of legal entities;
- Copy of the legal documentation of the natural persons (identity card/passport) and criminal record dully authenticated by the consular services of the republic of Angola at the country of residency in case of natural persons;
- Technical economic and financial feasibility study of the proposed investment project;
- Environmental Impact Study (When is it applicable in Angola); and,
- Presentation of Documents in Duplicate.
Angolan law provides equal access for women entrepreneurs and underrepresented minorities in the economy. However, in practice, the investment facilitation mechanisms do not provide added advantages to these groups. Programs to benefit female entrepreneurs and underrepresented groups such as startup projects, business capacity building and development, and financial assistance including micro credit, are mainly implemented by non-governmental organizations and international financial institutions such as the African Development Bank, the World Bank, and private sector companies.
The new state-run private investment agency AIPEX does not yet have a website.
Contact Information: Departamento de Promocao e Captacao do Investimento; Agencia de Investimento Privado e Promocao de Investimentos e Exportacoes de Angola (AIPEX). Rua Kwamme Nkrumah No.8, Maianga, Luanda, Angola Tel: (+244) 995 28 95 92| 222 33 12 52 Fax: (+244) 222 39 33 81
The Angolan Government does not promote or incentivize outward investment nor does it restrict Angolans from investing abroad. Investors are free to invest in any foreign jurisdiction.
According to a credible local newspaper, Expansao, based on data from the Angolan central bank, Banco Nacional de Angola (BNA), outward investments by Angolans exceeded USD 1 billion in 2015, for an aggregate total investment of more than USD 29 billion at the end of 2015. (Expansao Journal, March 3, 2017 edition).
2. Bilateral Investment Agreements and Taxation Treaties
Angola is party to several investment related treaties and conventions. In May 2009, Angola signed a Trade and Investment Framework Agreement (TIFA) with the United States, intended to provide a forum to address trade issues and to help enhance trade and investment relations between the two countries. The first meeting of the TIFA Council under this agreement took place in June 2010 with the recent meetings in 2015 and 2016 at the working level focused on a plan development, AGOA market access, and strategies to improve the business climate, but with limited engagement by the Angolan government under the then Minister of Commerce. The current Minister of Commerce has requested formal consultations under our Trade and Investment Framework Agreement (TIFA).
In July 2010, the United States and Angola signed a Memorandum of Understanding establishing a bilateral Strategic Partnership Dialogue, which commits the two parties to increased bilateral relations. Angola has bilateral investment agreements in force with Cabo Verde, Germany, Italy, and Russia. Angola has also signed agreements with Portugal, South Africa, Spain, Brazil, France, and the United Kingdom, but these agreements have not yet entered into force. A list of current bilateral investment treaties and their status can be found on the United Nations Conference on Trade and Development (UNCTAD) website.
Angola does not have a bilateral taxation treaty with the United States. However, the government successfully completed all internal procedures for entry into force of the Foreign Account Tax Complaint Act (FATCA).
On January 15, 2018, Parliament granted legislative authorization to the executive branch of the Angola Tax Administration to amend specific provisions of the current Angolan tax regime. Key proposed amendments to the respective tax codes will include:
- Introduction of a mechanism for the settlement of tax, by means of withholding, on purchases of goods from small businesses by companies that have organized accounting records and are subject to Industrial Tax;
- Extension of the list of professions annexed to the Personal Income Tax Code;
- Review of the Industrial Tax autonomous taxation regime;
- Improvement to the indirect methods tax framework;
- Amendments to the current Investment Income Tax exemption regime (i.e., “participation exemption”) on the distribution of profits to Angolan entities subject to Industrial Tax;
- Extension of the reverse charge mechanism applicable for Consumption Tax purposes, currently applicable in the Oil & Gas sector, to the financial, telecommunications and non-oil mining sectors;
- Extension of the application of Stamp Duty to the employment contracts of foreign nonresident individuals;
- New rules for the Stamp Duty tax liability regime;
- Amendments of the Consumption Tax incidence rules, namely on advertising services;
- Imposition of Urban Property Tax on sales’ agreements and in similar situations that imply the utilization of the property;
- Imposition of Urban Property Tax to all situations of use of the property due to the transfer of a contractual position, mere fruition and possession, even without proper title;
- Imposition of Consumption Tax on the issuance of air and sea transportation tickets, for routes to be carried out entirely in the national territory; and,
- Imposition of Stamp Duty on the collections’ receipts of independent workers.
4. Industrial Policies
The new investment law removes several obstacles that render the country’s business climate challenging and a deterrent to investors. Investment incentives in the new law include:
- Eliminating the minimum investment value and the value required to qualify for incentives in foreign and local investments, previously set at USD 1,000,000 and USD 500,000 respectively. There is no more limit to invest and qualify for incentives;
- Eliminating the obligation for foreign investors to establish a partnership with an Angolan entity with at least a 35 percent stake in the capital structure of investments in the electricity and water, tourism, transport and logistics, construction, media, telecommunications and IT sectors. Under the new law investors will decide on their capital structure and origin. Article 9 of the Private Investment Law, which has been in force since 2015, expressly states that foreign investment in Angola “is only permitted in the case of partnership with Angolan citizens, public capital companies or Angolan companies, which hold at least 35 percent of the share capital and participate effectively in the management reflected in the shareholders’ agreement; and,
- Granting foreign investors “the right and guarantee to transfer abroad” dividends or distributed profits, the proceeds of the liquidation of its investments, capital gains, the proceeds of indemnities and royalties, or other income from remuneration of indirect investments related to technology transfer after proof of implementation of the project and payment of all tax dues.
Investment incentives are granted by the AIPEX, the State’s investment agency, as opposed to by the President as mandated in the 2015 investment law.
Restructuring the country into three economic development zones (zones A through C) determined by political and socio-economic factors, up from two as per the 2015 investment law. For Zone A, investors have a 3-year moratorium on taxes reduced between 25- 50 percent of the tax levied on the distribution of profits and dividends. For Zone B, it is between three to six years with a 50 to 60 percent tax reduction, and for Zone C between six to eight years with a tax reduction between 60-70 percent of the tax levied on distribution of profits and dividends.
- Guaranteeing State “non-public interference in the management of private companies” and “non-cancellation of licenses without administrative or judicial processes.”
- The State provides a new and simplified procedure for the approval of investment projects, along with the adoption of measures aimed at accelerating the contractual process. It also provides special rights for certain projects (undefined), including easier access to visas and priority in the repatriation of dividends, and capital.
- Creation of a State-run agency, AIPEX, to act as the sole authority for negotiating, approving and supervising investment projects.
Angola is a signatory of the Agreement on Trade-Related Investment Measures (TRIMs).
In response to Angola’s economic situation, on December 27, 2017, the government approved and passed the “Plano Intercalar,” a plan containing several economic policy measures to address economic recovery, create credibility and confidence in the new government and introduce more rigorous macroeconomic stability measures. The plan hopes to address inflation, tax collection, monetary and exchange rate policy, the balance of payments, and the social sector.
Foreign Trade Zones/Free Ports/Trade Facilitation
Angola is a signatory to the Southern Africa Development Community (SADC). The government has indicated it may join the SADC Free Trade Zone, pending the country’s ability to build internal industrial capacity able to compete with other regional markets. Since such industrialization will take some time, it is likely that the government will opt for another 3-year extension on the decision to join SADC FTZ.
In 2009, Angola established the Luanda-Bengo Special Economic Zone (SEZ). Under the new investment law, Angola is divided into three economic zones, zone A through C. Zone A offers a three-year tax exemption for capital tax and a reduction in the tax burden by 25-50 percent; Zone B a three to six year tax exemption for capital tax with a reduction in the tax burden by 50-60 percent; and, for Zone C, an eight year tax exemption for capital tax with a with a 60-70 percent reduction in the tax burden.
Porto Caio is under construction in the province of Cabinda. The port is designated as a Free Trade Zone (FTZ) and is slated to provide numerous opportunities for warehousing, distribution, storage, lay down area and development of oil, and gas related activity. The Port will also serve as a new major gateway to international markets from the west coast of Angola, and the development will facilitate exports and render them more cost-effective for companies. Although the government has not yet established foreign trade zones, on March 21, 2018, the government signed an agreement creating the African Continental Free Trade Area (AfCFTA). The AfCFTA is the result of the African Free Trade Agreement among all 55 members of the African Union, and will be the largest free trade zone in the world since the emergence of the World Trade Organization (WTO). The agreement’s implementation could create a market of 1.2 billion consumers. The UN Economic Commission for Africa (UNECA) has estimated a 52 percent increase in intra-African trade by 2022. Currently, intra-African trade is only 16 percent, with intra-Latin American at 19 percent, intra-Asian at 51 percent, and intra-European at 70 percent.