Executive Summary

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.

Women Empowerment

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.

Table 1


Year Index/Rank Website Address
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


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.

Business Facilitation

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

Outward Investment

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).

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.

Transparency of the Regulatory System

Angola’s regulatory system is complex, vague, and inconsistently enforced. In many sectors, no effective regulatory system exists due to lack of institutional capacity. The banking system is slowly adhering to International Financial Reporting Standards (IFRS). Public sector companies (SOEs) are still far from practicing IFRS. The public does not participate in draft bills or regulations formulation, nor does a public online location exist where the public can access this information for comment or hold executives accountable for irresponsible actions. The Angolan Communications Institute (INACOM) sets prices for telecommunications services and is the regulatory authority for the telecommunications sector. Revised energy-sector licensing regulations have permitted some purchase power agreements (PPA) participation.

Overall, Angola’s national regulatory system does not correlate to other international regulatory systems. However, Angola is a member of the World Bank, African Development Bank (AfDB), the Organization of Petroleum Exporting Countries (OPEC) (January 2007), the United Nations (UN) and most of its specialized agencies – International Conference on Reconstruction and Development (IBRD), the United Nations Development Program (UNCTAD), the International Monetary (IMF), the World Health Organization (WHO), World Trade Organization (WTO), and has a partnership agreement with the European Union (EU). At the regional level, the GRA is part of the Common Market for Eastern and Southern Africa (COMESA), the Community of Portuguese Speaking Countries (CPLP), and the Southern African Development Community (SADC), among other organizations. Angola has yet to join the SADC Free Trade Zone of Africa as a full member. On March 21, 2018, together with 44 African countries, Angola joined the African Continental Free Trade Area (AfCFTA), an agreement aimed at paving the way for a liberalized market for goods and services across Africa. Angola is also a member of the Port Management Association of Eastern and Southern Africa (PMAESA), which seeks to maintain relations with other port authorities or associations, regional and international organizations and governments of the region to hold discussions on matters of common interest.

Angola became an original WTO Member on 23 November 1996; however, it is not party to the Plurilateral Agreements on Government Procurement, the Trade in Civil Aircraft Agreement and has not yet notified the WTO of its state-trading enterprises within the meaning of Article XVII of the GATT. A government procurement management framework introduced in late 2010 stipulates a preference for goods produced in Angola and/or services provided by Angolan or Angola-based suppliers. Technical Barriers to Trade (TBT) regimes are not coordinated. 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. Angola conducts several bilateral negotiations with Portuguese Speaking countries (PALOPS), Cuba and Russia and extends trade preferences to China due to credit facilitation terms, while attempting to encourage and protect local content.

Regulation reviews are based on scientific or data driven assessments or baseline surveys. Evaluation is based on data; however, it is not made available for public comment.

The National Assembly is Angola’s main legislative body with the power to approve laws on all matters (except those reserved by the Constitution to the Government) by simple majority (except if otherwise provided in the Constitution). Each legislature comprises four legislative sessions of twelve months starting on October 15 annually. National Assembly members, parliamentary groups, and the government hold the power to put forward all draft-legislation. However, no single entity can present draft laws that involve an increase in the expenditure or decrease in the State revenue established in the annual budget.

The President promulgates laws approved by the Assembly and signs Government Decrees for enforcement. The State reserves the right to have the final say in all regulatory matters and relies on sectorial regulatory bodies for supervision of institutional regulatory matters concerning investment. The Economic Commission of the Council of Ministers oversees investment regulations that affect the country’s economy including the ministries in charge. Other major regulatory bodies responsible for getting deals through include:

  • The Ministry of Petroleum: The government regulatory and oversight body responsible for regulating oil exploration and production activities. The national concessionaire is Sonangol EP, which is the holder of the concession rights and has the authority to conduct, execute, and ensure oil operations in Angola.
  • IRSEA: The regulatory authority for renewable energies and enforcing powers of the electricity regulatory authority.
  • The Angolan Communications Institute (INACOM): The institute sets prices for telecommunications services and is the regulatory authority for the telecommunications sector. Revised energy-sector licensing regulations have improved legal protection for investors to attract more private investment in electrical infrastructure, such as dams and hydro distribution stations.

Angola acceded to the New York Arbitration Convention on August 24, 2016 paving the way for the first time for effective recognition and enforcement in Angola of awards rendered outside of Angola and subject to reciprocity. Angola participates in the New Partnership for Africa’s Development (NEPAD), which includes a Peer Review Mechanism on good governance and transparency. Enforcement and protection of investors is under development in terms of regulatory, supervisory, and sanctioning powers. Investor protector mechanisms are weak or almost non-existent.

There are no informal regulatory processes managed by nongovernmental organizations or private sector associations, and the government does not allow the public to engage in the formulation of legislation or to comment on draft bills. Procurement laws and regulations are unclear, little publicized, and not consistently enforced. Oversight mechanisms are weak; no audits are required or performed to ensure internal controls are in place or administrative procedures are followed. Inefficient bureaucracy frequently leads to payment delays for goods delivered, resulting in an increase in the price the government must pay.

No regulatory reform enforcement mechanisms have been implemented since the last ICS report, in particular those relevant to foreign investors.

The Diario da Republica (the Federal Register equivalent), is a legal document where key regulatory actions are officially published.

International Regulatory Considerations

Angola’s overall national regulatory system does not correlate to other international regulatory systems and is overseen by its constitution. Angola is not a full member of the International Standards Organization (ISO), but has been a corresponding member since 2002. The Angolan Institute for Standardization and Quality (IANORQ) within the Ministry of Industry coordinates the country’s establishment and implementation of standards. Angola is an affiliate country of the International Electro-technical Commission that publishes consensus-based International Standards and manages conformity assessment systems for electric and electronic products, systems and services.

A government procurement management framework introduced in late 2010 stipulates a preference for goods produced in Angola and/or services provided by Angolan or Angola-based suppliers. Technical Barriers to Trade (TBT) regimes are not coordinated.

Angola acceded the Kyoto Convention on February 23, 2017.

Legal System and Judicial Independence

Angola’s formal legal system is primarily based on the Portuguese legal system and can be considered civil law based, with legislation as the primary source of law. Courts base their judgments on legislation and there is no binding precedent as understood in common law systems. The Constitution proclaims the Constitution as the supreme law of Angola (article 6(1)) and all laws and conduct are valid only if they conform to the Constitution (article 6(3)).

Businesses and non-governmental organizations report that the Angolan justice system is slow, arduous, and not always impartial. Legal fees are high, and most businesses avoid taking commercial disputes to court in the country. The World Bank’s Doing Business 2018 survey ranks Angola 186 out of 190 countries on contract enforcement, and estimates that commercial contract enforcement, measured by time elapsed between filing a complaint and receiving restitution, takes an average of 1,296 days, at an average cost of 44.4 percent of the claim.

Angola has commercial legislation that governs all commercial activities but no specialized court. In 2008, the Angola Attorney General ruled that Angola’s specialized tax courts were unconstitutional. The ruling effectively left businesses with no legal recourse to dispute taxes levied by the Ministry of Finance, as the general courts consistently rule that they have no authority to hear tax dispute cases, and refer all cases back to the Ministry of Finance for resolution. Angola’s Law 22/14, of December 5, 2014, which approved the Tax Procedure Code (“TPC”), sets forth in its Article 5 that the courts with tax and customs jurisdiction are the Tax and Customs Sections of the Provincial Courts and the Civil, Administrative, Tax and Customs Chamber of the Supreme Court. Article 5.3 of the law specifically states that tax cases pending with other courts must be sent to the Tax and Customs Section of the relevant court, except if the discovery phase (i.e., the production of proof) has already begun.

The Judicial system is administered by the Ministry of Justice at trial level for provincial and municipal courts and the Supreme Court nominates provincial court judges. In 1991, the constitution was amended to guarantee judiciary independence. However, as per the 2010 constitution, the President appoints Supreme Court judges for life upon recommendation of an association of magistrates and appoints the attorney general. Confirmation by the General Assembly is not required. The system lacks resources and independence to play an effective role and the legal framework is obsolete, with much of the criminal and commercial code reflecting colonial era codes with some Marxist era modifications. Courts remain wholly dependent on political power.

There is a general right of appeal to the court of first instance against decisions from the primary courts. To enforce judgments/orders, a party must commence further proceedings called executive proceedings with the civil court. The main methods of enforcing judgments are:

  • Execution orders (to pay a sum of money by selling the debtor’s assets);
  • Delivery up of assets; and,
  • Provision of information on the whereabouts of assets.

The Civil Procedure Code also provides ordinary and extraordinary appeals. Ordinary appeals consist of first appeals, review appeals, interlocutory appeals, and full court appeals, while extraordinary appeals consist of further appeals and third-party interventions. Generally, an appeal does not operate as a stay of the decision of the lower court unless expressly provided for as much in the Civil Procedure Code.

Laws and Regulations on Foreign Direct Investment

The newly constituted Agency for Investment and Promotion of Exports of Angola (AIPEX) is the sole investment and export promotion center tasked with promoting Angola’s export potential, legal framework, environment, and investment opportunities nationally and abroad. Housed within the Ministry of Commerce, AIPEX is also responsible for ensuring the application of the new 2018 investment law on Foreign Direct investments.

Competition and Anti-Trust Laws

On May 17, Angola’s National Assembly approved a Law on Competition. The law provides for the creation of the Competition Regulatory Authority, which is tasked with preventing and cracking down on actions of economic agents that fail to comply with the rules and principles of competition. The Competition Regulatory Authority may file a suit based on violations of fair competition rules.

The Pricing and Competition Bureau under the Ministry of Finance was created in 2011 (Presidential Decree 162/11) to ensure the coordination and consistency of pricing and revenue, under which goods and services were divided into three categories: 1) Preco Fixo (Fixed Price): Oil, gas, electricity, water, urban transportation; 2) Preco Vigiado (Monitored Price): Basic Food Basket: Sugar, rice, oil, salt, milk tomatoes, onions, fish, meat, etc., plus transportation (air, surface, rail, sea, ports.); and, 3) Free Price (Preco Libre): items not included in categories one and two. A February 25, 2016 Presidential Decree (28/16), further established price formation on categories two and three.

Expropriation and Compensation

Under the Land Tenure Act of 2004, all land belongs to the state and the state reserves the right to expropriate land from any settlers. The State may also allow for land usage through a 60-year lease, after which the State reserves legal right to take over ownership.

Expropriation without compensation remains a common practice. Land tenure became a more significant issue following independence from Portugal when over 50 percent of the population moved to urban centers during the civil war. The State offered some areas for development within a specific timeframe. After this timeframe, areas that remained underdeveloped reverted to the state with no compensation to any claimants. Almost in all cases, claimants allege unfair treatment and little or no compensation.

Dispute Settlement

Angola is not a member state to the International Centre for Settlement of Investment Disputes (ICSID Convention), but has ratified the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Its ratification was endorsed domestically via resolution No. 38/2016, published in the Official Gazette of Angola on August 12, 2016.

Investor-State Dispute Settlement

The Angolan Arbitration Law (Law 16/2003 of 25 July) (Voluntary Arbitration Law — VAL) provides for domestic and international arbitration. Substantially inspired by Portuguese 1986 arbitration law, it cannot be said to strictly follow the UN Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration. In contrast the VAL contains no provisions on definitions, rules on interpretation, adopts the disposable rights criteria in regards to arbitration, does not address preliminary decisions, nor distinguish between different types of awards, and permits appeal on the merits in domestic arbitrations, unless the parties have otherwise agreed.

Angola is also a member of the Multilateral Investment Guarantee Agency (MIGA), which can provide dispute settlement assistance as part of its political risk insurance products and eligibility for preferential trade benefits under the African Growth Opportunity Act. The United States and Angola have signed a trade and investment framework agreement (TIFA), which seeks to promote greater trade and investment between the two nations.

The U.S. Embassy is aware of two ongoing formal investment disputes involving American companies that went to arbitration in 2017.

International Commercial Arbitration and Foreign Courts

In June 2014, the Ministry of Justice and Human Rights (MINJHR) opened the Center of Legal Alternatives for Conflict Resolution. Among other functions, the Center is tasked with providing consultation, mediation, and arbitration of contract disputes for both Angolan and foreign businesses. The process is designed to be faster and less costly than the traditional court system. The U.S. Embassy is not aware of any cases reviewed by this court.

Local courts do recognize arbitration, but do not enforce or distinguish between different types of awards, and permit appeal on the merits in domestic arbitrations, unless the parties have otherwise agreed.

Bankruptcy Regulations

Angola is ranked 168 out of 190 on the World Bank’s Doing Business 2018 report on resolving insolvency.

As a former Portuguese colony, Angola inherited the Portuguese insolvency legislation. The current civil procedure code in force since 1961 establishes two different processes: a bankruptcy procedure applicable exclusively to commercial debtors, or an insolvency procedure applicable to non-commercial debtors.

The World Bank Doing Business 2018 report found that no foreclosure, liquidation, or reorganization proceedings were filed within the past 12 months. While Angola’s arbitration law (Arbitration Law No. 16/03) adopted in 2013 introduced the concept of domestic and international arbitration, the practice of arbitration law is still not widely implemented.

The Ministry of Finance, the BNA and the Capital Markets Commission (CMC) oversee credit monitoring and regulation.

Investment Incentives

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.

  1. Guaranteeing State “non-public interference in the management of private companies” and “non-cancellation of licenses without administrative or judicial processes.”
  2. 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.
  3. 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.

Real Property

Land reform  in Angola  occurred in 2002 following the end of the Angolan Civil War . After two years of preparation, the land law (Lei de Terras de Angola) was passed on December 18, 2004. While the land act is a crucial step toward addressing issues of land tenure, normalization of land ownership in Angola  persists with problems such as difficulties in completing land claims, land grabbing , lack of reliable government records, and unresolved status of traditional land  tenure. Among other provisions, the law included a formal mechanism for transforming traditional land property rights into legal land property rights (clean titles). During the civil war, a transparent system of land property rights did not exist, so it was crucial to re-establish one shortly after the end of hostilities. Transparency and land property rights are critical for Angolan economic development given that two thirds of Angolans work in agriculture  and are thus directly dependent on land property rights.

One of the main tasks of the new Angolan land law is to protect people from evictions, which occurred frequently during the colonial period as well as during the civil war, largely due to unclear land property rights. Under the Constitution, the state has ultimate ownership of Angola’s land with the exception of land protected under international law. The land law authorizes private rights to urban land (i.e. cities, townships) that have qualities of freehold titles: the landholder has a perpetual right of occupancy and land usage, and the landholder can transfer, mortgage, and sell the right. However, the purchase and sale of untitled urban land must be by public auction. The law permits most urban and some non-urban land obtained for economic purposes to be leased through long-term renewable leases from the Angolan government for up to 60 years, a process used especially in the case of rural agricultural land used for economic purposes, and often includes renewal options at the end of the lease.

Legislation governing the right of access to land includes the 2004 “Land Act” and “General Concession of Land Regulations.” According to the “Land Act,” the State may transfer or constitute, for the benefit of Angolan natural or legal persons, a multiplicity of land rights on land forming part of its private domain. Although, it is possible to transfer ownership over some categories of land, the transfer of State land almost never implies the transfer of its ownership, but only the formation of minor land rights with leasehold being the most common form in Angola. The recipient of private property rights from the State can only transfer those rights with consent of the local authority and after a period of five years of effective use of the land (GRA 2004 law). Weak land tenure legislation and lack of secure legal guarantees (clean titles), are the reasons given by most commercial banks for their greater than 80 percent refusal rate for loans since land is used as collateral. Foreign real-estate developers therefore seek out public-private partnership (PPP) arrangements with State actors who can provide protection against land disputes and financial risks involved in projects that require significant cash outlays to get started.

Registering parcels of land over 10,000 hectares must be approved by the Council of Ministers. Registering property takes 190 days on average, according to the World Bank’s Doing Business 2018 survey, with fees averaging three percent of property value. Owners must also wait five years after purchasing before reselling land. There are no written regulations setting out guidelines defining different forms of land occupation, including commercial use, traditional communal use, leasing, and private use. Over the years, the government has given out large parcels of land to individuals in order to support the development of commercial agriculture. However, this process has largely been unsystematic and does not follow any formal rule change on land tenure by the State.

Before obtaining proof of title, an Angolan citizen or an Angolan legal entity must also obtain the Real or Leasing Rights (“Usufruct”) of the Land from the Instituto de Planeamento e Gestao Urbana de Luanda. This is often a time-consuming procedure, taking up to a year or more. However, in the case that company X already owns the land the company must secure a land property title deed from the Real Estate Registry in Luanda. An updated property certificate (“certidao predial”) is obtained from the relevant Real Estate Registry, with the complete description of the property including owner(s) information and any charges, liens, and/or encumbrances pending on the property. The complex administration of property laws and regulations that govern land ownership and transfer of real property as well as its tedious registration process may reduce investor appetite for real estate investments in Angola. Despacho no. 174/11 of March 11, 2011 mandates the total fees for the “certidao predial” include stamp duty (calculated according to the Law on Stamp Duty); justice fees (calculated according to the Law on Justice Fees); fees to justice officers (according to the set contributions for the Justice budget); and, notary and other fees. The total fee is also dependent on the current value of the fiscal unit (UCF), which is currently at Angolan Kwanza 88.00 (USD 40 cents equivalent).

Intellectual Property Rights (IPR)

Angolan law recognizes the protection of IPR. Angola’s National Assembly adopted the Paris Convention for the Protection of Industrial Intellectual Property in August 2005, incorporating the 1979 text, and the patent cooperation treaty concluded in 1970, and amended in 1979 and 1984. The Ministry of Industry administers intellectual property rights for trademarks, patents, and designs under Industrial Property Law 3/92. The Ministry of Culture regulates authorship, literary, and artistic rights under Copyright Law 4/90. Angola is a member of the World Intellectual Property Organization (WIPO) and follows international patent classifications of patents, products, and services to identify and codify requests for patents and trademark registration. There are currently no statistics available regarding counterfeit goods seized by the Angolan government.

INADEC (Instituto Nacional de Defesa dos Consumidores), under the umbrella of the Ministry of Commerce, tracks and monitors the seizure of counterfeit goods seized by the Angolan government. They do not currently have a website, nor do they regularly publish statistics. They publish the seizure of counterfeit products on an ad-hoc basis, primarily in the government-owned daily, Jornal de Angola.

IAPI (Instituto Angolano de Propriedade Intelectual), is the governmental body within the Ministry of Industry charged with implementing patent and trademark law. The Ministry of Culture oversees copyright law. IP infringement is widespread, most notably in the production and distribution of pirated CDs, DVDs, and other media, largely for personal consumption. Counterfeit pharmaceuticals are another major area of concern.

Angola is not listed on the USTR’s 2017 Out-Of-Cycle Review of Notorious Markets, or in the 2018 Special 301 Report. For additional information about treaty obligations and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/ .

The U.S. Embassy point of contact for IPR related issues is Mballe Nkembe (NkembeMM@state.gov). For legal counsel, refer to Angola’s Country Commercial Guide Local Professional Services List (http://export.gov/ccg/angola090710.asp )

Capital Markets and Portfolio Investment

Angola’s capital markets remain very underdeveloped. To respond to the need for increased sources of financing of the economy, in 2013, the Angolan Government created the Capital Market Commission (CMC). Angola’s banks are likely the most established businesses that could potentially list on an exchange. However, many Angolan banks have a high rate of non-performing loans, reported to be as high as 31 percent. Angola’s banks have struggled in recent years due to the country’s deteriorating economic environment and increasing high rate of delinquent loans. The Governor of the BNA has stated that Angola’s banks must go through a consolidation phase over the next year, which may limit their ability in the near-term to list on the country’s fledgling stock exchange.

In May 2018, Angola raised USD 3 billion in its second Eurobond issue in international markets. The two-part deal included a USD 1.75 billion of 10-year bond with an 8.25 percent yield and a second of USD 1.25 billion of 30-year bonds with a 9.37 percent yield. Angola previously, in 2012, through Russia’s second-largest bank, VTB, managed the sale of its first international bond, a USD 1 billion, 7-year bond with a 7.0 percent yield. In November 2015, Angola placed a USD 1.5 billion, 10-year Eurobond with a 9.5 percent yield. Deutsche Bank, Goldman Sachs, and ICBC managed the 2015 bond placement.

The BNA has developed a market for short-term bonds, called Titulos do Banco Central, and long-term bonds, called Obrigacoes do Tesouro. Most of these bonds are bought and held by local Angolan banks. The Obrigacoes have maturities ranging from one to 7.5 years, whereas the Titulos have maturities of 91 to 182 days. For information on current rates, see: http://www.bna.ao/ .

Foreign investors do not normally access credit locally. For Angolan investors, credit access is very limited, and if available comes with a collateral requirement of 125 percent, so they either self-finance, or seek financing from non-Angolan banks and investment funds. Subsidized government loan programs to promote economic development, such as the Ministry of Economy’s Angola Invest USD 1.6 billion fund to support small and medium-sized enterprises with loans of up to USD 5 million. These loans are available only to majority-owned Angolan companies, but due to reports of limited quality projects and commercial banks reticence, only a handful of the Angola Invest loans were approved in 2017.

Money and Banking System

The BNA has remained under considerable pressure to stabilize Angola’s economy as the kwanza lost over 55 percent of its value since 2014. The BNA has struggled to fully implement reforms across Angola’s banks, which have lost their correspondent relationships with banks in the United States. Angola has been affected by the broader global de-risking trends wherein banks decide to close business in markets deemed too risky from an anti-money laundering and terrorist financing standpoint. In December 2016, Deutsche Bank, the last international bank providing dollar-clearing services, closed its dollar clearing services in Angola. A limited number of international banks still operate in Angola and provide limited trade finance such as Germany’s Commerzbank and South Africa’s Standard Bank. International banks have held back on entering the Angolan market because the risk of fines and other penalties outweighs the potential rewards of doing business in Angola.

In an effort to increase greater confidence in the banking sector, President Joao Lourenco appointed Jose de Lima Massano as new Governor of the Central Bank on October 30, 2017. The BNA has since raised the mandatory capital start-up requirements for banks from USD 25 million to USD 50 million in the hopes of reducing the number of banks and force necessary mergersCommercial banks operating in Angola also have until the end of 2018 to increase their share capital to USD 35 million, in line with Notice 2/2018 from the BNA on the “Adequacy of Minimum Capital Stock and Regulatory Own Funds of Financial Banking Institutions.” This regulatory instruction will be reinforced by current draft legislation (“Implementation Strategy of Executive Macroeconomic Program 2017”), which seeks to designate six Angolan Banks (BAI, BIC, Banco Economico, Banco Millenium-Atlantico, BNI, and Banco Sol) to handle 80 percent of Forex in the primary market. The remaining 22 banks are likely to survive only by merging with other banks.

Angola has a low banking market penetration rate and ranks 183 out of 190 countries in the World Bank’s Doing Business 2018 report on the ease of getting credit indicator. According to latest demographics recorded on the last census in 2014, the rate of banked population is 47 percent. As of December 2013, the latest figures available indicated that total customer deposits with the Angolan commercial banks was 4.6 trillion Angolan kwanza, an increase of 17 percent since 2012. Angolan banks extend little unsecured credit, instead requiring significant amounts of collateral (125 percent) in the form of property, or dollar deposits from the borrower. Commercial credit in Angola remains tight. Unclear land titles and ill-defined property rights frequently complicate and lengthen the process of applying for a mortgage. While the BNA tries to limit foreign currency risk, some loans are denominated in foreign currencies, but are consequently weighted at 130 percent for the calculation of risk-weighted assets.

Five banks, Banco Angolano de Investimentos (BAI), Banco Economico, Banco de Fomento Angola (BFA), Banco BIC Angola (BIC) and Banco de Poupanca e Credito S.A.R.L. (BPC), control over 80 percent of total banking assets, deposits, and loans. Angolan banks focus on profit generating activities including transactional banking, short-term trade financing, foreign exchange, and investments in high-interest government bonds. Loans to most sectors have slowed because of the economic crisis. BNA and local bankers have also indicated that there is a growing level of non-performing loans (12 percent in 2015 and 31.3 percent as of December 31, 2017 according to the BNA Financial Indicator System) corresponding to USD 6.8 billion out of USD 22 billion of loans granted. Across most economic sectors, clients struggle to make payments on loans because of the economic crisis. Most banks focus their operations on short-term commission-related activities and are the largest purchasers of government treasuries. Even with the severe economic slowdown and reduction in overall foreign exchange availability, bank profit margins are still high enough to allow them to sustain operations. However, traditional commercial loans are still only a small part of banking in Angola. In the past, state and state-affiliated companies enjoyed privileged access to loans, often at concessionary rates without regard to risk, leading to several bank failures.

Foreign Exchange and Remittances

Foreign Exchange Policies

Angola continues trading mostly in two currencies, the USD and the Euro, with the Renminbi gaining greater prominence given the degree of trade with China. In a bid to deal with the foreign currency shortage and substantial foreign currency arbitrage in the parallel market, the government has opted for a managed float for its currency exchange rate. The Angolan Kwanza was pegged at a rate of 166.00 per U.S. dollar from April 2016 to January 2018 following a steep devaluation due to the slump in oil prices. On January 10, 2018, the BNA began conducting foreign currency auctions allowing the kwanza to fluctuate within an undisclosed but controlled band. As a result, the BNA facilitated a 20 percent devaluation of the kwanza. Commercial banks now purchase foreign currency from the BNA at weekly auctions within the undisclosed band. Payment of remittances in any form and non-strategic imports face a lengthy wait between 90-180 days for foreign exchange. Priority is given to strategic importers of food, raw materials for construction, agriculture, medicine and the oil sector. The government also has a huge backlog of forex arrears of approximately USD 3 billion.

Investors cannot freely convert their earnings in kwanza to any foreign exchange rate due to limited available foreign exchange. Credit cards and other options for payment are extremely limited and money-servicing businesses (Western Union & MoneyGram) have ceased foreign outward transactions in foreign currency.

Remittance Policies

The Angolan government established anti-money laundering restrictions in January 2014 to combat illicit remittance flows. The subsequent drop in foreign exchange availability in Angola beginning in 2015 due to declining petroleum revenues has severely impeded personal and legitimate business remittances. International and domestic companies operating in Angola face significant delays securing foreign exchange approval for remittances to cover key operational expenses, including imported goods and expatriate salaries. Profit and dividend remittances are even more problematic for most companies. The Angolan government has prioritized foreign exchange for essential goods and services including the food, health, defense, and petroleum industries. Due to the tremendous strains on foreign exchange, in 2017, reports indicated that the country drew substantially from its international reserves to increase foreign exchange liquidity in the market. As a result, Angola’s international reserves, which had been protected carefully at USD 24 billion, were reportedly down to USD 13.3 billion as of December 31, 2017. However current levels are now estimated at USD 12.5 billion. Foreign exchange allocations from the BNA since 2016 have been almost exclusively in Euros, partly driven by the loss of corresponding banking relationships with U.S. banks. Profits and dividends repatriation are not prioritized by the BNA, which aggressively protects the country’s foreign exchange.

The new 2018 investment law grants foreign investors “the right and guarantee to transfer abroad” dividends or distributed profits, the proceeds of the liquidation of their 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 taxes due. Under the previous 2015 investment law, foreign investors were required to pay higher taxes on early repatriation of dividends and profits within the first several years of an initial investment. The new tax on dividends starts at 15 percent and can rise to as high as 50 percent depending on the value and how early repatriation occurs. Under regulations established in July 2013 aimed at tracking capital movement, strengthening the banking system, and capturing tax revenue, foreign companies are required to process transactions through Angolan banks.

Sovereign Wealth Funds

In October 2012, former President Eduardo dos Santos established a petroleum-funded USD 5 billion sovereign wealth fund called the Fundo Soberano de Angola (FSDEA). The FSDEA was established in accordance with international governance standards and best practices as outlined in the Santiago Principles. In February 2015, the FSDEA was recognized as transparent by the Sovereign Wealth Fund Institute (SWFI), receiving a score of 8 out of 10. The FSDEA has the express purpose of profit maximization with a special emphasis on investing in domestic projects that have a social component (http://www.fundosoberano.ao/investments/ ). Jose Filomeno dos Santos (Zenu), son of President Jose Eduardo dos Santos, was appointed chairman of FSDEA in June 2013, but has been since removed by President Lourenco based reportedly on poor results at the FSDEA. Zenu also came into the spotlight following revelations by the “Paradise Papers” that approximately USD 3 billion of the FSDEA’s capital was illicitly invested in seven offshore corporations in Mauritius. Zenu was further accused of embezzling USD 500 million from a BNA account held in a London-based bank. Former Finance Minister Carlos Alberto Lopes was named new head of the FSDEA.

Half of the initial endowment of FSDEA was invested in agriculture, mining, infrastructure, and real estate in Angola and other African markets, and the other half was supposedly allocated to cash and fixed income instruments, global and emerging-market equities, and other alternative investments. Since the revelations of the Paradise Papers, the Government of Mauritius, in concert with the Angolan government, has frozen seven bank accounts in Mauritius linked to the FSDEA, and suspended business licenses linked to the FSDEA’s Swiss manager, Quantum Global Investment Management.

In Angola, certain state-owned enterprises (SOEs) exercise delegated governmental powers, especially in the mining sector where the government is the sole concessionaire. Foreign investors may sometimes find demands made by SOEs excessive, and under such conditions, SOEs have easier access to credit and government contracts. There is no law mandating preferential treatment to SOEs, but in practice they have access to inside information and credit. Currently, SOEs are not subject to budgetary constraints and quite often exceed their capital limits.

SOEs, often benefitting from a government mandate, operate mostly in the extractive sectors, transportation, commerce, banking, and construction. All SOEs in Angola are required to have boards of directors, and most board members are affiliated with the government. SOEs are not explicitly required to consult with government officials before making decisions. By law, SOEs must publish annual financial reports for the previous year in the national daily newspaper Jornal de Angola by April 1. Such reports are not always subject to publically released external audits (though the audit of state oil firm Sonangol is publically released). The standards used are often questioned. Not all SOEs fulfill their legal obligations, and few are sanctioned.

In April 2016, former Angolan President dos Santos vacated the board of Sonangol, and in June 2016, installed one of his daughters, well-known business woman Isabel dos Santos, as its Chief Executive to “ensure transparency” in its management and to improve the Angolan oil sector’s ability to compete globally. In December 2016, the Angolan Supreme Court ruled that Ms. Dos Santos’ appointment did not constitute a criminal act under Angola nepotism laws. However, in November 2017, only two months into his tenure, President Lourenco fired Isabel dos Santos from the position and named Carlos Saturnino, who had previously served as the Chairman of the Executive Board at Sonangol.

Angola’s supreme audit institution, Tribunal de Contas, is responsible for auditing SOEs. However, the Tribunal de Contas does not make its reports publicly available. Angola’s fiscal transparency would be improved by ensuring its supreme audit institution audits SOEs, as well as the government’s annual financial accounts, and makes public its findings within a reasonable period. Publicly available audit reports would also improve the transparency of contracts between private companies and SOEs.

In November 2016, the Angolan Government revised Law 1/14 “Regime Juridico de Emissao e Gestao da Divida Publica Directa e Indirecta,” which now differentiates between ‘direct’ and ‘indirect’ public debt. The GRA considers SOE debt as indirect public debt, and only accounts in its state budget for direct government debt, thus effectively not reflecting some substantial obligations in fact owed by the government.

Angola is not a party to the WTO’s Government Procurement Agreement (GPA). Angola does
not adhere to the OECD guidelines on corporate governance for State-owned enterprises.

Privatization Program

The government has a plan to privatize 33 of 90 public companies by sale through the Angola Debt and Securities Exchange market (BODIVA). The privatization plan is in line with the provisions of the Government’s Interim Macroeconomic Stabilization Program (PEM), which aims to rid the government of unprofitable public institutions. The government plans to privatize part of state-owned Angola Telecommunications Company, companies in the oil and energy sector, as well as several textile industries. The government has stated that the privatization process will be open to interested foreign investors and has guaranteed a transparent bidding process. The government created a privatization commission on February 27, 2018 but no website has yet been created for submission of tenders. Sonangol also stated that it plans to sell off its non- core businesses as part of its restructuring strategy to make the parastatal more efficient.

The government has enacted laws to prevent labor by children under 14 and forced labor, although resource limitations hinder adequate enforcement. With limitations, the laws protect the rights to form unions, collectively bargain, and strike. Government interference in some strikes has been reported. The Ministry of Public Administration, Employment, and Social Security, has a hotline for workers who believe their rights have been infringed. Angola’s Chamber of Commerce and Industry (CIACC) established the Principles of Ethical Business in Angola.

In 2015, Angola organized an interagency technical working group to explore Angola’s possible membership in the Voluntary Principles on Security and Human Rights (VPs) and the Extractive Industries Transparency Initiative (EITI). Angola has been a member of the Kimberley Process (KP) since 2003, and chaired the KP in 2015, until handing over the rotating chair to the United Arab Emirates.

Angola is not a party to the WTO’s Government Procurement Agreement (GPA), and does not adhere to the OECD guidelines on corporate governance for State-owned enterprises.

Corruption remains pervasive and institutionalized. It has substantially raised the cost of doing business in Angola and has had a corrosive impact on international market investment opportunities and on the broader business climate. Transparency International’s 2017 Corruption Perceptions Index ranks Angola 167 out of 175 countries in its corruption level survey. Prevalent in all sectors of the Angolan society, corruption has remained widespread due to a lack of political will to combat it effectively, appropriate checks and balances, insufficient institutional capacity, and a culture of impunity.

However, against this backdrop, President Lourenco has prioritized the fight against corruption through stronger collaboration and partnership with trade unions, nongovernmental organizations, and civic associations. His government has consulted with industry, cut government expenditure, increased non-oil sector revenue, and devalued the national currency. Lourenco has begun dismantling monopolies to increase market competition and attract investment, and he has won greater investor confidence by removing the former President’s children and incompetent bureaucrats from key government positions. President Lourenco is developing legal instruments to repatriate undeclared assets held by Angolans offshore – valued at approximately USD 30 billion. He has mandated that all senior government officials declare their assets and he has fired several top officials over corruption allegations.

The 2010 Law on Administrative Probity, unlike Lourenco’s mandate for senior government officials, requires all public officials to disclose their assets and income once every two years, and it prohibits public servants from receiving money or gifts from private business deals. The Penal Code makes it a criminal offense for private enterprises to engage in business transactions with public officials. Angola has incorporated regional anti-corruption guidelines and incorporated them into their domestic legislation, including: the Southern Africa Development Community’s (SADC) “Protocol Against Corruption,” the African Union’s “Convention on Preventing and Combating Corruption,” and the United Nation’s “Convention against Corruption.” Angola does not have an independent body to investigate and prosecute corruption cases, and generally, enforcement of existing laws is weak or non-existent. Three institutions – the Audit Court, the Inspector General of Finance, and the Office of the Attorney General – perform many of the anti-corruption duties in Angola. http://www.business-anti-corruption.com/country-profiles/sub-saharan-africa/angola/initiatives/public-anti-corruption-initiatives.aspx 

Regardless of the laws on the books and institutions that exist to combat corruption, corruption, including bribery, raises the costs and risks of doing business and can create an uneven playing field for foreign investors. Corruption has a corrosive impact on market opportunities for U.S. companies and the broader business climate. It also deters greater international investment, stifles economic growth and development, distorts prices, and undermines the rule of law.

It is important for U.S. companies, irrespective of their size, to assess the business climate in the sector in which they will be operating or investing, and to have an effective compliance program or measures to prevent and detect corruption, including foreign bribery. U.S. individuals and firms operating or investing in Angola, should take the time to become familiar with the relevant anticorruption laws of both Angola and the United States in order to properly comply with them, and where appropriate, they should seek legal counsel.

In 1996, the Government of Angola enacted by presidential decree the Alta Autoridade Contra Corrupcao (High Authority Against Corruption) Act. There has been no action taken to implement the law since it was enacted.

UN Anticorruption Convention, OECD Convention on Combatting Bribery

Angola is not a member state to the UN Anticorruption Convention or the OECD Convention on Combatting Bribery.

Politically related violence is not a high risk in Angola, and incidents are rare. The August 2017 election marked Angola’s first transition of power in 38 years, when former President Eduardo dos Santos, one of the longest serving Presidents on the continent, opted to step down. Current President Joao Lourenco has emerged as the most popular political figure in Angola, revitalizing support for the MPLA and slowly improving Angola’s international image as a result of his sweeping reform agenda and eagerness to engage with the international community. His January 2018 trip to Davos for the World Economic Forum (a first for an Angolan president) added to his narrative as an open, reform-minded politician. While the MPLA continues to dominate the political landscape, UNITA remains the largest opposition party, and a viable third party, CASA-CE, has emerged over the last five years. Lourenco has made positive statements encouraging freedom of speech, but there is room for improving respect for human rights. Reports of excessive use of force by law enforcement, as well as restrictions on freedom of assembly and association, and discrimination and abuse of immigrants and migrants, are serious problems. Civil society is underdeveloped and, at times, stifled in its efforts to check government abuses.

The head of the Southern African Development Community’s (SADC) Organ on Politics, Defense and Security, Angola is actively engaged on the political crises in the Democratic Republic of the Congo (DRC), Zimbabwe, Lesotho, as well as other countries in the region. In November 2017, Angola sent its first-ever contingent of peacekeeping troops to participate in the SADC regional stabilization mission to Lesotho. President Lourenco visited Kinshasa on February 14, 2018 to encourage President Kabila to hold elections in 2018. Angola continues to struggle with its legacy of land mines and is far from reaching a mine-impact free status by 2025, a commitment that the government made under the Ottawa Convention. Since 1995, the United States (Angola’s largest demining donor) has invested more than USD 124 million in Angola to clear and dispose of landmines, unexploded ordnance, and aging weapons and munitions.

The last significant incident of political violence happened in 2010 during an attack against the Togolese national soccer team by FLEC-PM (Front for the Liberation of the Enclave of Cabinda—Military Position) in the northern province of Cabinda. FLEC threatened Chinese workers in Cabinda in 2015 and claimed in 2016 that they would return to active armed struggle against the Angolan government forces. No attacks have since ensued and the FLEC has remained relatively inactive. New president Joao Lourenco has pledged to govern for all Angolans, and combat two of the country’s major problems: corruption and mismanagement of public funds.

The likely continuation of reduced revenue from oil exports will continue to limit the GRA’s ability to provide the goods and services for Angolan citizens. The GRA has already slashed its budget by half since the start of the economic crisis in 2014, necessitating the cutting of many subsidies for Angolans (including the gasoline and diesel subsidies). In addition, the GRA has increased tax rates and the tax collection base. Although many Angolans take advantage of lax GRA implementation capabilities, the combination of decreasing government services and increasing costs for them, could raise tensions, particularly in an environment where the government has an inconsistent record of accomplishment of delivering basic services. In response, the government has maintained robust spending in 2018 on its internal security and military budget. The government has also attempted to levy new taxes on the oil industry and has promulgated a plan to impose taxes for trash collection on residents and businesses. These taxes would be payable through electricity bills.

The Angolan labor force has limited technical skills, English language capabilities, and managerial ability. Many employers find it necessary to invest heavily in educating and training their Angolan staff. Angola’s labor force was estimated to be 10.85 million in 2016. The literacy rate is estimated to be 71.1 percent (82 percent male, 60.7 percent female). A 2013 National Statistics Institute (SNI) study indicates that formal unemployment is around 26 percent, although these figures are based on limited data taken primarily from urban centers. 86 percent of primary school age children attend school. The Law mandates that children must attend school for six years beginning at age six. 29 percent of boys and 17 percent of girls attend high school.

There are gaps in compliance with international labor standards that may pose a reputational risk to investors. Children are sometimes employed in agriculture, construction, fishing, and coal industries. Forced labor is sometimes used in agricultural, fishing, construction, domestic service, and artisanal diamond mining sectors. Additional information is available in the 2017 Trafficking in Persons Report (https://www.state.gov/j/tip/rls/tiprpt/2017/), 2016 Country Report on Human Rights Practices (https://www.state.gov/j/drl/rls/hrrpt/humanrightsreport/), and 2016 Findings on the Worst Forms of Child Labor, (https://www.dol.gov/agencies/ilab/resources/reports/child-labor/angola ).

Angola’s General Labor Law (Law No. 2/00), updated in 2015, recognizes the right of workers, except members of the armed forces and police, to form and join independent unions, to collectively bargain, and to strike, but these rights are either limited or restricted. To establish a union, a minimum of 30 percent of workers from a sector at the provincial level must participate and prior authorization by authorities with accompanying bureaucratic approvals is required. Unlike workers in the private sector, civil service employees do not have the right to collective bargaining. While the law allows unions to conduct their activities without government interference, it also places some restrictions on engaging in a strike. Strict bureaucratic procedures must be followed for a strike to be considered legal. The government can deny the right to strike or obligate workers to return to work for members of the armed forces, police, prison staff, fire fighters, “essential services” public sector employees, and oil workers. The government may intervene in labor disputes that affect national security, particularly strikes in the oil sector. The definition of civil service workers providing “essential services” is broadly defined, encompassing the transport sector, communications, waste management and treatment, and fuel distribution.

Collective labor disputes are to be settled through compulsory arbitration by the Ministry of Labor, Public Administration and Social Security. The law does not prohibit employer retribution against strikers, but it does authorize the government to force workers back to work for “breaches of worker discipline” or participation in unauthorized strikes. The law prohibits anti-union discrimination and stipulates that worker complaints be adjudicated in the labor court. Under the law, employers are required to reinstate workers who have been dismissed for union activities.

The General Labor Law also spells out procedures for hiring workers. For work contracts of indefinite duration, the law provides for a basic probationary period of up to six months, during which the worker or employer can terminate the contract without notice or justification. After the probationary period ends, dismissed workers have the right to appeal to a Labor Court. Many employers prefer to reach a monetary settlement with workers when a dispute arises, rather than bring cases before the Labor Court. The World Banks Doing Business 2018 report placed the average cost of firing a worker in Angola at 26.7 weeks of salary weighting for workers with one year, five years, and 10 years of tenure. The notice period before dismissing a worker is 4.3 weeks.

The government conducts annual surveys of the oil industry to implement a requirement that oil companies hire Angolan nationals when qualified applicants are available. If no qualified nationals apply for the position, then the companies may request the government’s permission to hire expatriates. Outside of the petroleum sector, policies to encourage “Angolanization” of the labor force, i.e. the hiring of locals, discourages bringing in expatriates. However, the associated visa processes for the oil industry are currently easier and faster due to a special process the Angolan Ministry of Petroleum offers companies in that sector. Additionally, working visas for other sectors are also easier to obtain.

Since 1994, the Overseas Private Investment Corporation (OPIC) has provided investment insurance to projects in Angola. U.S. investors can apply for OPIC insurance, including coverage under the “Quick Cover” program for projects valued at less than USD 50 million. OPIC’s portfolio in Angola currently totals USD 20.4 million. Since the agreement, OPIC’s support has helped facilitate critical investments in the energy, services, health care, manufacturing, and financial services sectors.

Angola is a member of the Multilateral Investment Guarantee Agency (MIGA), which provides insurance to foreign investors against such risks as expropriation, non-convertibility, and war or civil disturbance. MIGA also provides investment dispute resolution on a case-by-case basis.

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy

Host Country Statistical Source USG or International Statistical Source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) (M USD) 2017 USD 124,500 2016 USD 96,200 https://www.imf.org/en/Publications/CR/
Foreign Direct Investment Host Country Statistical Source USG or International Statistical Source USG or international Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country (M USD, stock positions) 2016 USD 747 2015 USD 780 BEA data available at http://bea.gov/international/direct_investment_multinational_companies_comprehensive_data.htm 
Host country’s FDI in the United States (M USD, stock positions) 2016 USD 234 2015 USD 207 BEA data available at http://bea.gov/international/direct_investment_multinational_companies_comprehensive_data.htm 
Total inbound stock of FDI as % host GDP 2016 730.2% 2015 24% N/A


Table 3: Sources and Destination of FDI

Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward Amount Total Outward Amount
China #1 USD 2.825 China #1 USD 14.276
Portugal #2 USD 2.450 India #2 USD 2.676
Korea, Rep. #3 USD 1.434 Spain #3 USD 2.241
United States #4 USD 1.234 France #4 USD 1.568
South Africa#5 USD 909 Other Asia #5 USD 1.409
“0” reflects amounts rounded to +/- USD 500,000.


Table 4: Sources of Portfolio Investment

Data not available.

Dorcas Makaya, Economic Specialist
United States Embassy, Luanda
Rua Houari Boumedienne 32 Miramar, Angola
+244 222 641 154

2018 Investment Climate Statements: Angola
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