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AfrElec REFORMS AfrElec
Angola hopes reforms will help attract investment
ANGOLA
JOSE Massano, the governor of Angola’s Cen- tral Bank, said last week that he hoped the gov- ernment’s plans for economic reform would facilitate efforts to privatise key state-owned enterprises, including a stake in the national oil company (NOC) and other assets in the hydro- carbon sector.
Massano told Reuters that Luanda was mak- ing changes in a bid to reassure the foreign firms that have been expressing “tremendous interest” in government-owned assets. Potential partners have remained concerned about corruption, state interference in business and unfavourable investment conditions, he explained.
“Most of the investors, they express con- cerns [about] the security of getting funds into Angola,” he noted. But he stressed that he did not expect foreign companies to encounter any roadblocks on this front, saying: “In the past, we have had that difficulty, but we have also intro- duced changes.”
For example, he said, Angola’s government took action earlier this year to facilitate the pro- cess of repatriating funds. It not only cleared for- eign partners’ outstanding requests to withdraw money from the country but also amended the legal regime to ensure that investors would be able to repatriate funds through commercial banks, rather than working through the Central Bank, he stated.
Additionally, he said, Luanda has eliminated regulations that require outside investors to team up with a locally owned partner.
Reuters, meanwhile, noted that the latest reforms followed other changes. Last year, it reported, the government slashed taxes on smaller oilfields, bringing them down by 50% to a level of 10%, and set up a new independent agency, the National Agency for Petroleum, Gas
and Biofuels (ANPG), to assume responsibility for the sale and management of hydrocarbon concessions.
The Angolan government hopes that these and other reform measures will help shore up sagging oil output levels. It hopes to raise cash that Sonangol can use for exploration and devel- opment partly by attracting new partners and partly by selling off state-owned assets.
In August, officials in Luanda said the NOC had already drawn up a schedule for the asset sales and unloading its share in a refinery in Cote d’Ivoire before the end of 2019. In 2020, they added, Sonangol will offer its stake in China Sonangol, a joint venture with Hong Kong- based New Bright International Development, and 28% of Puma Energy, its joint venture with the international commodities trading firm Tra- figura. Then in 2022, they said, it will launch an initial public offering (IPO) of stock.
Total investments
New projects and development programmes will also play a role in boosting Angolan oil produc- tion. For example, France’s Total has unveiled plans to resume offshore exploration work within a section of Block 17, a deepwater site, and at Block 48, an ultra-deepwater site, in 2020, Xinhua reported last week.
The Chinese agency quoted Olivier Jouny, the general manager of Total’s Angolan division, as saying that the French giant had also invested $2.5bn in three new projects this year. Jouny did not identify the projects but said that the influx of funds would help push Angolan output up by more than 100,000 barrels per day (bpd), Xin- hua said. He was speaking after a meeting with members of Angola’s National Assembly’s Com- mission on Economy and Finance.
Week 42 23•October•2019 w w w . N E W S B A S E . c o m P7
