By Florindo Chivucute

 

Angola presents a striking paradox in the global economy. Despite being a major oil and gas producer, it remains one of the poorest countries in sub-Saharan Africa, nearly five decades after gaining independence from Portugal in 1975. This contradiction stems from a complex interplay of factors, primarily corruption, large-scale embezzlement of public funds, and a lack of economic diversification.

The scale of Angola’s resource wealth is highlighted by a recent Oilprice.com article by Charles Kennedy. Citing a Dodd-Frank Act disclosure, Kennedy reports that Chevron, a major oil company, “paid three times more in taxes in three African countries than it did at home.” Specifically, “The supermajor paid some $6.25 billion in taxes and production sharing to Nigeria, Angola, and Equatorial Guinea last year, Bloomberg reported, citing the disclosure. At home, Chevron’s tax bill stood at $1.99 billion.”[1]

However, this wealth has not translated into widespread prosperity. “Poverty is among Angola’s most pervasive challenges: in 2019, three out of every five Angolans — over 19 million people — were living under the extreme poverty line for lower middle-income countries (US$3.20 per day). Two out of five Angolans are living on less than US$1.90 per day, the income level used to measure global progress towards the United Nations’ first Sustainable Development Goal to eliminate extreme poverty by 2030.”[2] These statistics underscore the stark disparity between Angola’s natural resource wealth and the living conditions of its citizens, highlighting the urgent need for effective governance and economic reforms.

 

Corruption is still a significant problem in Angola

Corruption remains a significant problem in Angola, identified for decades as a primary factor contributing to the country’s economic inequality and stunted development. In 2017, newly elected President Joao Lourenço promised to combat corruption within the government led by his political party (MPLA), which has ruled Angola since independence in 1975. However, efforts to establish anti-corruption agencies and enact new laws have faced significant challenges, particularly from political elites who have long benefited from grand corruption. As a result, corruption persists as a deeply entrenched issue.

The consequences of this endemic corruption are devastating for Angolan families, condemning millions to life below the extreme poverty line. The efficacy of President Lourenço’s anti-corruption campaign, promised in 2017, remains uncertain. Similarly, the impact of asset recovery efforts on the lives of ordinary Angolans is yet to be determined.

Furthermore, large-scale embezzlement of public funds has severely impacted Angola’s educational system, leaving it underfunded and inaccessible to thousands of students, particularly at the primary level. The scale of this challenge is evident in the statistics provided by SINPROF. According to their data, Angola currently has 103,599 classrooms spread across a mix of public, public-private, and private schools. Public schools account for 61% of these classrooms, while public-private partnerships make up 33%, and private institutions comprise the remaining 6%. These classrooms are grouped into either 13,238 schools, according to data from provincial education offices, or 10,084 schools, as reported by the statistics department of the Ministry of Education.[3]

However, these numbers fall far short of the country’s needs. As stated by SINPROF: “On balance, the country needs approximately twice as many classrooms as it currently has if it wants to reduce the pupil-classroom ratio and solve the problem of school exclusion. For this to happen, the Executive will have to build between 1,500 and 2,000 schools a year, over a five-year time horizon, with schools that meet the projected population growth in the circumstances in which they are built.”[4]

This situation raises a critical question: How can one of the world’s largest oil and gas producers be unable to build enough schools to provide access to primary education for all its children? The same issue extends to middle and high school education, with a shortage of facilities to accommodate thousands of young Angolans seeking to advance their education.

The answer lies in the large-scale embezzlement of public funds, which has led to a systemic lack of investment in basic public infrastructure. This neglect extends beyond education to other critical areas such as clean water access, affordable housing for low-income families, and road infrastructure. In essence, Angola’s vast natural resource wealth, instead of benefiting its citizens through improved education and infrastructure, is being siphoned off through corruption, leaving the country’s future generations without the tools they need to thrive and develop their nation.

 

Extent of corruption

While corruption permeates all aspects of public life in Angola, occurring at various levels of government and society, the most significant issue is the grand corruption practiced by high-level officials. This includes politicians, business leaders, and military/police personnel. Grand corruption encompasses large-scale embezzlement of public funds, bribery, and other illicit activities that are uniquely accessible to high-ranking officials due to the complexity of domestic and international financial systems.

The scale of this problem is reflected in Angola’s consistently high ranking on international indices measuring corruption. A prime example of the systemic nature of this corruption is the state-owned oil company, Sonangol. This entity has been at the center of numerous corruption allegations, facing accusations of mismanagement, embezzlement, and nepotism within its operations.[5]

These practices not only drain the country’s resources but also undermine public trust, hinder economic development, and perpetuate a cycle of poverty and inequality. The entrenched nature of corruption at the highest levels of power presents a significant challenge to reform efforts and the equitable distribution of Angola’s vast natural resource wealth.

 

Efforts to combat corruption

The effectiveness of Angola’s anti-corruption measures is a subject of debate, with conflicting assessments from international organizations and local perspectives.

According to Transparency International, Angola continues to “register marked progress in their fight against corruption:” This progress is evidenced by consistent efforts to recover stolen assets and openly hold alleged perpetrators to account through the national justice systems. Angola has implemented an anti-corruption strategy spanning 2018-2022, which, along with other judicial reforms, has led to significant asset recovery.  The sovereign wealth fund has recovered US$ 3.3 billion in assets, while  the investigation and prosecution of high-ranking officials has culminated in the recovery of approximately US$ 7 billion in total financial and tangible assets.[6]

However, contrary to these positive reports, local Angolans and Afrobarometer present a more skeptical view. In a 2023 report titled “Angolans see growing corruption, government failure to contain it,” Afrobarometer highlights persistent challenges. Their findings reveal that a considerable proportion of citizens perceive corruption as increasing in the country, particularly in public institutions such as the national police and the Presidency. A majority of Angolans rate the government’s performance in fighting corruption as poor. The report also notes that many “Angolans report having to pay bribes to obtain government services, and most believe that ordinary people risk retaliation if they report corruption.”[7]

Despite these varying assessments of anti-corruption efforts, there is consensus that corruption remains a significant problem in Angola. It continues to be identified as one of the primary factors contributing to the country’s economic inequality and lack of development. The disparity between official reports of progress and public perception underscores the complexity of addressing deeply entrenched corruption in governmental and societal structures. This ongoing challenge highlights the need for continued, transparent efforts to combat corruption at all levels of Angolan society, with a focus on both systemic reforms and changing public perceptions.

 

Lack of diversification in the economy

For nearly five decades, Angola’s economy has been dominated by its oil and gas industry, a situation perpetuated by the ruling Movimento Popular de Libertação de Angola-MPLA (People’s Movement for the Liberation of Angola). Since gaining independence in 1975, the MPLA has consistently failed to diversify the nation’s economic base, despite repeated political promises. This lack of diversification persisted through the long reign of former President Jose Eduardo dos Santos, who ruled Angola with an iron fist for almost four decades. The trend has continued under the current President Lourenco, also from the MPLA, whose two terms (spanning 10 years) will conclude in 2027 without achieving significant economic diversification.

The neglect of the development of sectors outside the Oil and Gas industry can be further explained by a phenomenon called the “Dutch disease, which is an “economic phenomenon where the rapid development of one sector of the economy, particularly natural resources, leads to a decline in other sectors.”[8] However, this is not the sole explanation. Large-scale embezzlement of public funds has also played a crucial role. Funds earmarked for crucial infrastructure development in transportation, education, healthcare, and manufacturing are often mismanaged by public officials or diverted for personal gain through privatization schemes.

As a result, the wealth generated by the oil and gas industry is concentrated in the hands of a few, primarily individuals with political power and connections to the ruling party. This concentration of wealth has led to significant inequality, which in turn harms the country’s broader economic development. The ripple effects of this economic mismanagement extend beyond mere financial concerns. The lack of development in diverse sectors has contributed to high unemployment rates. Coupled with a decline in democratic processes and human rights, these factors threaten to erode the fragile peace that Angola has achieved since its long civil war.

This complex interplay of economic mismanagement, corruption, and political stagnation presents a significant challenge to Angola’s future development and stability. Addressing these issues will require not only economic reforms but also political will to implement genuine changes in governance and resource allocation.

 

About the author
Florindo Chivucute is the founder and Executive Director of Friends of Angola (FOA), and an activist with 15 years of experience as a Program Manager. Mr. Chivucute earned his B.A. in Government & International Politics and Master’s degree in Conflict Analysis and Resolution from George Mason University, United States.