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Changing Sonangol: Can Angola finish what it started?
After a promising start, President João Lourenço’s ambitious plan to reform Angola’s state oil company Sonangol appears to have ground to a halt. His government has been forced to turn its attention away from the complex task of fundamentally reforming the Angolan economy to focus on a pressing currency and cost-of-living crisis that threatens to sap its weakening public support. This leaves foreign investors in Angola’s oil sector wondering about what might happen next and when.
Tough choices: roadblocks stack up
Deteriorating economic conditions, combined with growing dissatisfaction with the ruling MPLA, are forcing Lourenço to make tough choices. He faces an unenviable trade-off between prioritising the necessary but politically draining long-term reforms that Angola needs and the immediate demands of an increasingly disgruntled population struggling to make ends meet.
Angolans face considerable economic challenges from inflationary pressure stoked by the plunging value of the national currency, the kwanza, and a contracting economy. The general economic decline has spiked poverty-induced violent crime and led to almost daily demonstrations in Luanda and other major cities. That some of these have been met by a violent response from the Angolan security forces does little to boost Lourenço’s popularity. Neither did he endear himself much with his attempt - at the IMF’s instigation - to cut domestic fuel subsidies.
Read the full article on Intellinews.
Photo by LUDOVIC MARIN/AFP via Getty Images