Distribution and logistics partnerships are “window of opportunity” for Angola

10 July 2006

Lisbon, Portugal, 10 July – Partnerships in the areas of distribution and logistics, particularly in large retail spaces or transport infrastructures, are a “window of opportunity” for companies in various fields to enter the Angolan market, says the Portuguese Industrial Association (AIP).

In a study recently published in Lisbon, which Macauhub had access to, the AIP gives special mention to opportunities created by a nationwide commercial network, duly supported in logistical terms, which envisages the construction of supply markets, hypermarkets, shopping centers and organized markets.

“The business configuration of the supply markets will increasingly involve partnerships between local councils, producer organizations and national and overseas private agents. The market, in this area, will select holders of capital and knowledge”, says the AIP report.

Partnerships in supply markets, according to the AIP, are “increasingly a window of opportunity for entities with the financial capacity to build their operations in Angola.”

“In the spirit of opportunity offered by decentralization, medium-sized firms, in terms of financial capacity, can have an input in the assertion of ‘second-line’ cities. These public-private partnerships are also a significant factor in the stimulation and development of a banking system”, says the report seen by Macauhub.

“It is a niche that is growing in public and private agents, as the first are the main stimulators of construction of urban and rural supply markets, while the latter (particularly Angola’s large group companies) will be in the frontline in the building of large commercial areas”, adds the AIP.

Figures from Angola’s National Statistics Institute show that in 2000 there were 27,870 commercial enterprises in the country to serve a population of 14 million, an average of 500 people per shop.

Of the total number of businesses, 17,871 were retailers, just over 5,000 wholesalers, nearly 4,000 service companies and 976 of a mixed nature.

According to the AIP researchers, the development of a middle and upper-middle class with a large consumption capacity “investment in large urban and suburban commercial areas (hypermarkets, supermarkets and shopping centers) a historic and probably unrepeatable opportunity, from a viewpoint of maintenance of stability.”

The AIP also highlights the opportunity of partnerships with private Angolan companies in the sector of logistics and transport, lacking support for modernization, that are required by economic growth and a more demanding trading network.

“The weakness of the national logistical operators, particularly transport agents, creates ample investment openings in the establishment of new operators or in the conclusion of partnerships with existing ones”, the report adds.

Other investment opportunities identified in the study are outsourcing of logistical services, public and private entities, rural business and warehousing infrastructures.

The AIP also highlights possibilities for investment and modernization offered by privatizations and public-private partnerships in the management of transport infrastructures, particularly ports and railways.

“The introduction of business management methods or the privatization of port assets, together with private participation in the operation of these, can attract investment and increase their efficiency”, say the AIP researchers.

In the rail sector, adds the AIP, current rehabilitation projects “can keep the railroads working until the process of private operator concessions is concluded, which had been forecast for 2005.”

The sector presenting the most modest growth prospects is air transport, which will feel the effect of better safety and reliability of both road and rail transport. (macauhub)