Angola wants to join Mozambique and Cape Verde in US Millennium Account

4 June 2007

Luanda, Angola, 4 June – Angola wants to join Mozambique and Cape Verde in the United States Millennium Challenge Account program, which annually provides US$5 billion in development aid, in exchange for fulfilment of good governance criteria.

The news was recently reported by the Africa Monitor newsletter, which said that the aim, which was being pursued through a discreet lobbying campaign, was specifically a political one.

As well as boosting ties to the United States, by joining the MCA, Angola would make up for the political and diplomatic effects of the break away from the International Monetary fund (IMF), which was recently announced, and would provide an international image of a country committed to good governance, given the restrictive joining requirements.

As well as Cape Verde and Mozambique, the MCA includes Benin, Ghana, Lesotho, Madagascar, Mali and Senegal.

The US government has significantly raised the amount of funding available to the program and has announced its intention to expand the number of countries to benefit form it.

The 16 criteria for joining the MCA, measured by data from dozens of sources, are split into three basic groups: fair governance, investment in people and promotion of economic freedom.

The latter group, for example, includes the country’s credit rating (by Institutional Investor Magazine), inflation (IMF), three-year budget deficit (IMF and national accounts), commercial policy (Heritage Foundation), regulatory quality (World bank Institute) and the number of days needed to set up a business (World Bank).

According to Africa Monitor, Angola has a heavy-weight ally in this campaign, the US oil companies, which in the past were decisive for Angola to be part of the African Growth Opportunity Act (AGOA).

This differs from the MCA because it focuses on commercial policies in order to make it easier for certain products from African countries to enter the United States, but Angola has taken little advantage of joining, as it exports to the world’s largest economy are practically limited to oil, a product which is excluded from the list.

The same source added that in the opinion of Malik Chaka, the head of the Africa Department of the Bush administration, is that Angola does not yet fulfil the necessary criteria, but the State Department, which is traditionally more benevolent in relation to Angola’s plans, may be of support.

A sign of that closeness was last week’s visit to Angola – after 18 months in the role and last-minute delay – of the sub-secretary of state, Jendayi Frazer.

Frazer visited projects financed by her country via USAID in several parts of the country and praised the progress of the projects and cooperation with the authorities.

With the double objective of getting support for joining the MCA and of attracting investment, the Angolan Embassy in Washington recently organized “Angola Day” in the US capital, which was attended by an official delegation headed by Industry Minister, Joaquim David.

The message left at the different events, which included a dinner hosted by US oil company Chevron and an investor conference, was that the country is now stable and is undergoing a phase of economic reconstruction, and therefore US businesspeople should take advantage of the many opportunities available.

Analysts have already spoken of a movement to get closer to the United States, as an attempt at accessing financial and technical means provided by US cooperation.

According to Portuguese analyst Xavier Figueiredo, from Africa Monitor, it is also a “balancing element” in relation to the intense relationship Angola has with China, a country which is by far the most committed to development projects in Angola. (macauhub)