Angola reaps “immense rewards” from cooperation with China

11 July 2011

Lisbon, Portugal, 11 July – Angola is reaping “immense rewards” from its cooperation with China without having to give up its economic, political and cultural autonomy, according to the Portuguese Institute of International Relations and Security (IPRIS).

In a recent article entitled, “Angola and China: Building friendship through infrastructures,” published in the “Viewpoints” bulletin of the IPRIS, analyst Vasco Martins said that, despite criticism, “China’s involvement in Angola had largely favoured the population and the government in general.”

He pointed to the fact that, in the first phase of Chinese funding for reconstruction, US$423 million were applied to Health and Education, as compared to US$243 for Energy and Water, “where China’s interests lie.”

“These figures alone point to the immense benefits that Angolans in general have been experiencing by dealing directly with China, thus by-passing international conditions for funding and challenging the view of the realists that Angola is becoming a client state,” he said.

According to official Angolan public works, education and transport projects have benefited most from credit concession agreement between the China Export-Import Bank (Eximbank) and Angola, which now total US$4.6 billion.

The funding is the result of agreements signed by the Eximbank and the Angolan Finance Ministry, initially in March, 2004, worth US$2 billion.

This credit line was then extended with US$500 million in July 2007, via a credit line for complementary projects, and a further US$2 billion in September of the same year.

Selection of the projects is the responsibility of the Angolan side, which via ministerial departments identifies and puts forward the proposals for the consideration of China’s Trade Ministry.

Vasco Martins notes that funding from Beijing was provided at times when the International Monetary Fund (IMF) was demanding conditions from Luanda and Western powers considered it “too risky” to loan the country money.

“At a time when international financial institutions were reluctant to provide Angola with the necessary funding, the Chinese system made use of its natural pragmatism to generate profitable deals and secure access to oil reserves,” he said.

Years alter, the “success of Chinese investments,” has made it possible to attract investment from other countries and nowadays Angola, “feels comfortable cooperating politically with China, without fear of association or subordination.

The IPRIS analyst noted that, on a cultural level, “it is easier for Portuguese and Brazilian investors to have easier access to deals with the government,” and that the Angolan elite are, “too possessive to allow any attempts to control the country or to turn it into a client state.”

“In the end, it is perhaps not a marriage, but rather a very fruitful friendship,” he said.

The capital of Angola, Luanda, on 20 and 21 July is due to host the 2nd meeting of businesspeople for trade and economic cooperation between Portuguese-speaking countries and China, and Macau will attend with a delegation including members of the government and businesspeople. (macauhub)