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Angola: From liberation to `capitalismo selvagen'

Angola's oil wealth has fueled the growth of a rich elite while little has trickled down to the poor majority.

[The following article first appeared in AfricaFile's At Issue Ezine, vol. 12 (May-October 2010), edited by John S. Saul, which examines the development of the southern African liberation movement-led countries. It has been posted at Links International Journal of Socialist Renewal with permission.]

* * *

By David Sogge

June 2010 -- At Issue Ezine -- What’s in a name? For the ruling party of Angola, it seems, quite a lot. In December 2009, that party formally abandoned its original name from 1956, Movimento Popular de Libertação de Angola, the Popular Movement for the Liberation of Angola. Henceforth it would be known merely by the old initials: MPLA. Evidently the party thought it best to bury and forget terms like "movement" and "liberation". Besides, it had long ago dropped the word Popular from new nation’s first name, the People’s Republic of Angola.

Such fiery terms from a burnt-out era no doubt left a lot of people cold. But deleting those tokens of past ideals came at an odd time. For never in its 53-year history had the MPLA’s claims to a popular mandate looked stronger. In high-turnout parliamentary elections in September 2008, it got more than four out of every five votes. Six years earlier, its triumph over [US-backed] warlord-led UNITA [National Union for the Total Independence of Angola -- União Nacional para a Independência Total de Angola], and the non-punitive peace deal that followed, met with overwhelming popular relief, even among people on the losing side. True, Angolans express hearty contempt for their political class. Yet popular expectations are rising; most people express optimism about the future. Urbanised and Portuguese-speaking, they see themselves no longer chiefly as members of ethnic blocs, but as citizens of one Angolan nation. The MPLA, more than any other political force, contributed to those outcomes.

No such scenario seemed feasible in 1973. At that time the party was on the ropes, reeling from Portuguese counter-insurgency and from its own self-inflicted wounds. Both Washington and Moscow had written it off. Yet from that near-death experience, the MPLA made an astonishing come back as a thrusting new African power. With military help from Cuban communists and plenty of petrodollars from Western capitalists, it gained time, space and know-how to recover and get the upper hand. After taking power in 1975 it set about building three key institutions: a disciplined army and security apparatus; a professionally run state holding company, Sonangol; and a well-oiled system of patronage. Shrewd management of all three led to advances on the fronts of coercive power, state revenues and domestic politics. In short, the MPLA built what Cold War Washington least wanted to see: a black African state with muscle and "attitude".

 From that near-death experience, the MPLA made an astonishing come back as a thrusting new African power ... (building) what Cold War Washington least wanted to see: a black African state with muscle and "attitude". 

For its impudence, Angola paid in blood. Unlike Afghanistan, where US support to Islamic fundamentalists to "roll back" communism brought nasty blowback for the US itself, US support to African anti-communists brought death and wretchedness only for Angolans. From 1975 to 2002 about 1.5 million of them perished, a staggering number for a country of only 6 million people in 1975. Of these, about 160,000 died in combat — the heaviest battle casualties, in absolute numbers, of any African conflict in the 20th century.

War utterly transfigured Angola. As violence forced nearly half the population to flee their homes, urban shack settlements mushroomed around towns and cities. As the elaborate agro-industrial system collapsed, it took with it a sizable class of small producers and most of the proletariat, proportionately one of Africa’s largest. As the belligerents swept up tens of thousands of young people into their war machines, years of apprenticeship began in trade schools for violence. Many of these veterans are today on payrolls of the army, police and private security companies.

The rest of the war’s uprooted and dispossessed are scraping by in netherworlds of informal work and commerce, the onshore economy’s new centre of gravity. As elsewhere in global capitalism, that free market is only for losers. The economic winners, being politically well connected, get rich pickings such as control over lucrative import monopolies. Import streams they control supply most of the markets where the povo, the common people, do the work, take the risks and pay off the Economic Police and other shakedown artists to leave them in peace. Such is life under capitalismo selvagen, jungle capitalism.

In contrast to the rest of Africa, Angola’s elites never allowed the International Monetary Fund (IMF) to supervise economic policy directly. Yet by 1990 they had nonetheless embraced key tenets of the Washington Consensus: liberalisation of external flows, austerity for public services and privatisation of public assets. In so doing, they quashed any remaining hopes of a social contract — "satisfaction of the people’s needs", in the discourse of the MPLA anno 1975. The policies ushered in a bonanza for the political class and their corporate allies abroad.

 Angola’s elites never allowed the IMF to supervise economic policy directly. Yet by 1990 they had nonetheless embraced key tenets of the Washington Consensus ... (quashing) any remaining hopes of a social contract. 

With the introduction of "market friendly" policies, capital flight took wing. A recent study indicates that in the 1990s illicit outflows averaged $542 million a year, roughly 6 per cent of GDP; in the period 2000-2008 they averaged $2.7 billion a year, roughly 14 per cent of GDP.1 Angola’s "peace dividend" has meant, literally, big dividends for interests abroad.

Judicial activists like French magistrate Eva Joly and research activists groups like Global Witness have revealed much about these shadowy systems. But just where Angola’s siphoned-off wealth is stashed and who owns it are largely guesswork. All outflows are murky and circuitous, coursing through multiple secrecy jurisdictions from London and Lichtenstein to Delaware to end up mainly on Wall Street. That is the most likely destination identified by a team of economists of the US Federal Reserve, after sifting a lot of data in the opaque world of petrodollars.2 "Market friendly" policies have meant exactly that: friendly to the markets.

In addition, legally earned monies get special handling in Angola itself. Foreign corporations face low taxes and streamlined repatriation of profits — a fact attentively noted in a US government review of Angola’s investment climate and in scorecards of "economic freedom" by influential think tanks in Washington DC.

Domestic businesses, on the other hand, face different rules. They cannot accumulate at will; indeed any Angolan seeking to make serious profits has first to cut a deal with an appropriate politician. For the MPLA, any effort to accumulate beyond its supervision is a matter of zero tolerance, for that could lead to autonomous bases of power. Hence there are no Angolans making money on a substantial scale outside the purview and participation of the political class.

MPLA statecraft includes control over media and the flow of ideas. But its main levers work through the distribution of money, status and official positions. The MPLA has used these levers, backed by brute coercion, to forge informal pacts among elites, to co-opt and neutralise adversaries and keep the wayward on board. Despite rumours of mutual distrust — stories of VIPs at dinner parties who refuse to drink from bottles not opened before their own eyes or to eat anything not tasted first by their flunkeys — the political class is holding together rather well. Pacts and patronage have been stabilising in Angola’s case.

 MPLA statecraft includes control over media and the flow of ideas. But its main levers work through the distribution of money, status and official positions. 

Indeed the MPLA’s centrally managed patronage system has thus far proven a reliable way to manage politics where centrifugal forces are strong and a lot of lootable wealth is at stake. That system enabled recruitment of former "outsider" ethnicities into the military’s top brass. It works through revenue sharing (as in oil-rich Zaire and Cabinda, and diamond-rich Lundas) and the allocation of official positions from which rents can be extracted. Its domesticating effects are now apparent; with the exception of a renegade militia in Cabinda, which mortified the government in January by shooting up a busload of Togolese football players, Angola is at peace. The argument that resources breed political chaos doesn’t hold for Angola; mere plunder and oppression to the neglect of statecraft has never been the MPLA approach.

The MPLA has for example worked shrewdly to contain independent ideas and citizen activism. In the early post-independence years it tried to colonise civil spaces with Soviet-type monopoly organisations for women, workers, peasants and youth. But with the exception of the women’s organisation these never achieved any real legitimacy.

Today in civil society the MPLA employs both sticks and carrots. Repressive measures include containment (independent media confined mainly to Luanda, for example), secret police infiltration and strong-arm action such as against low-income residents of prime urban land in Luanda and Lubango. Positive incentives include the dispensing of charity by its own NGOs, notably the Eduardo dos Santos Foundation. Patronage and perks offered through the party’s Specialty Committees have kept many urban professionals away from political activism. Progressive parties and vibrant periodicals (digital and printed) are alive and kicking in Luanda, but faced with MPLA cunning they have yet to form a critical mass in political life.

Citizens might mount stronger counter-pressures if there were effective court systems and other channels for public complaint and transparent regulation. And indeed cases sometimes get hearings in real courts of law, with occasional advances in real justice. These episodes may help explain why a small majority of Angolans polled by the BBC in 2008 claimed to trust the country’s legal system. In March 2010, a provincial court convicted seven police offciers of the unlawful killing of eight youth in a Luanda neighbourhood, although the court was at pains to exclude higher-ups from any culpability. Indeed it appears that most of those at upper levels enjoy effective immunity from justice. Also in March, the government promulgated the Public Probity Law that would penalise corruption and oblige top public officials to declare their personal wealth at home and abroad. It allows anyone to denounce abuses by public figures, but severely penalises anyone making accusations deemed to be false.

Will this and other impressive laws actually promote transparency, honesty and respect for human rights? The leadership has in any case shown no haste in beefing up the Prosecutor’s Office (responsible for enforcing the new Public Probity Law) or in expanding a responsive judiciary. It prefers instead to foist law-enforcement-lite agencies onto the public. The Judicial Ombudsman’s office, provincial human rights commissions and mediation centres may provide occasions for citizens to ventilate complaints, but none has a mandate to enforce laws or impose legally binding outcomes. They help alert the authorities to problems without requiring them to find solutions. Yet because they reflect, however dimly, the principle that citizens may express grievances, those bodies can’t be dismissed out of hand. They might someday provide sites for the powerless to gain a little leverage over, or at least embarrass, the powerful.

 Privatisation of public services is advancing ... (they) are never portrayed as citizen entitlements, but rather as commodities you have to pay for, or beneficence you have to show gratitude for. 

But how much of the public realm will survive? Privatisation of public services is advancing, and it largely precludes the making of claims. Private providers, for-profit or not-for-profit, face almost no obligations publically to account for what they do or fail to do. In any case public services are never portrayed as citizen entitlements, but rather as commodities you have to pay for, or beneficence you have to show gratitude for. Neoliberal norms blanket the land, crowding out anything smacking of an equitable social contract. Indeed, Angolans are captive to a curious fusion of neoliberal formulas and a coercive state.

Nevertheless, a few groups in the emancipatory wing of civil society keep probing for progressive openings. They have engaged with public service providers and local level governments to press for public consultation and innovation in government services, such as schooling for children and range management for livestock. Whether such scattered efforts can hold the line against further commodification, vigorously backed by Angolan elites and most foreign donors, remains to be seen.

Angola’s elites call most of the shots domestically. They do so with increasing self-assurance — some domestic critics call it arrogance — thanks to the state’s huge spending powers. With oil output now surpassing that of Nigeria and oil prices still buoyant, the pressures for conspicuous consumption have been intense. That has left its mark in traffic gridlock, port congestion, tiny apartments renting for $15,000 per month. Demand has provoked supply through conspicuous investment: superhighways, shopping malls and gated housing estates.

State corporations have now taken up an old Angolan practice, shopping abroad. Angola’s main state holding company Sonangol has recently become a major if not dominant shareholder of Portuguese energy, banking and media firms. Maximising financial returns is not necessarily the point here; some observers see instead Angolan elites gaining satisfaction in lording it over the former coloniser in Lisbon. Portuguese officials in their turn never fail to express gratitude for the Angolan patronage and custom. Angola has become, after Spain, Germany and France, the fourth most important customer for Portuguese exports. Meanwhile Angolan corporate interests are also spreading their wings in the Democratic Republic of Congo, Equatorial Guinea, Gabon and elsewhere in the Gulf of Guinea.

Banks have worked overtime in Angola to sell loans and commodity credits. China has been hugely successful in this. Pressures to borrow are intense, yet don’t always get satisfied. Government hopes to raise $4 billion on the European bond market — billed as the largest ever bond issue by a sub-Saharan African state — have been shelved for want of an international credit rating. Perhaps for this reason in 2009 the IMF finally got its foot in the door with a $1.4 billion loan to shore up government reserves and cushion a fiscal shortfall.

Foreign borrowings and services are destined to keep building a classically high modernist, outwardly oriented model of development. The government’s Anti-Poverty Strategy may be studded with terms like social equity and even redistribution; but today that earnest policy paper, stillborn in 2005, has been quietly forgotten. Recently several leading Angolan development specialists — Fernando Pacheco, Cesaltina Abreu and Carlos Figuereido — dismissed notions that Angola might achieve by 2015 even one of its eight millennium development goals — despite their all being achievable, as Figueriedo observed, given Angola’s financial capacities. The outlook is even more pessimistic, he concluded, considering the political weight of the forces and policies that prioritise those anti-poverty goals.3

 Today’s political economy resembles the colonial order of yesterday in a number of ways. A narrow state-based elite manages the economy ... to promote a development model that redistributes wealth upward and outward. 

In sum, today’s political economy resembles the colonial order of yesterday in a number of ways. A narrow state-based elite manages the economy in collaboration with foreign corporations to promote a development model that redistributes wealth upward and outward. The elite uses foreign-equipped coercive methods and a modicum of public services and charity to keep the lid on popular discontent. At the same time, activists in the emancipatory camp of civil society, in Angola and abroad, keep probing the connections, embarrassing the rulers with their revelations and animating social and intellectual responses.

Yet today’s situation looks different in two fundamental ways: first, governing elites are African and hold territorial powers legitimised by elections; second, national economic life is now far more dependent on consumers and producers in richer countries. Hence today’s paradox: Angolans have formal standing as citizens with votes as well as informal claims on their rulers, but they don’t count for much as consumers and producers; indeed the development model has no place for most of them. Elites’ confusion of economic growth with development is, in the words of Fernando Pacheco, "painful and extremely penalising for Angolans".4

But what of the future? Some foresee a developmental state comparable to the Asian tigers. For the cautious mainstream economist Paul Collier, "Angola, with its oil and its Atlantic coastline, could well prove to be another Malaysia". Others merely continue expressing breathless enthusiasm — "leaping from strength to strength", "on the cusp of a real economic take-off" — without conjuring up specific scenarios.

Hence a giddy optimism persists, spurred by up-ticks in oil markets. In contemporary capitalism, after all, only the short term really matters. Yet specialists focused on the long term have begun telling different story, one about falling oil revenues. "As its main oil fields reach maturity", a London business newsletter wrote recently, "production is likely to peak sometime around 2015, at which point its current and fiscal account surpluses are all but certain to disappear".5 In short, Angola’s glittering coach may soon to turn into a pumpkin.

When a fiscal and debt crisis hits Angola, a political crisis will not be far behind. Among the urban salaried strata, especially those on civilian and military state payrolls, lifestyle and career expectations have kept on rising. So too have expectations among more peripheral members of the political class and their hangers-on at the receiving ends of patronage flows. Cutbacks to these flows would bring on an unpleasant downshift in expectations. Some would take harder hits than others. The basis of elite pacts could then become quite fragile.

 When a fiscal and debt crisis hits Angola, a political crisis will not be far behind ... some politicians might renounce their wilful amnesia and revisit the progressive political project the MPLA once talked about. 

Should those pacts come unglued and discontent gel into organised pressure, some politicians might renounce their wilful amnesia and revisit the progressive political project the MPLA once talked about. The wish of the new Angolan bourgeoisie to prettify their biographies has already been satirised in the 2004 novel The Seller of Pasts .6 Today, members of Angola’s bruised but resilient progressive camp, and its allies abroad, face the challenge of reinventing that political project.

Notes

1. Global Financial Integrity, Illicit Financial Flows from Africa: Hidden Resource for Development (Washington DC: GFI, 2010), http://www.gfip.org. GDP data from http://unstats.un.org.

2. M. Higgins and others, "Recycling Petrodollars", Current Issues in Economics and Finance (New York: Federal Reserve Bank of New York, December 2006).

3. "Angola fica a meio do caminho", Correio do Patriota (15 October 2009), http://www.correiodopatriota.com.

4. "Ligações perigosas", Correio do Patriota (25 January 2009).

5. "Angola’s Bond Issue: Prospects and Problems", Newsletter (London: Business Monitor International, 14 December 2009).

6. By the Angolan novelist José Eduardo Agualusa. Original title: O Vendedor de Passados .

Selected bibliography

"L’Angola dans la paix. Autoritarisme et reconversions." Special Issue of Politique Africaine 110 (2008).

BBC World Service Trust. Elections Study Angola 2008. London: BBC World Service Trust, 2008.

Birmingham, David. Frontline Nationalism in Angola and Mozambique . London: James Currey, 1992.

Chabal, Patrick, and Nuno Vidal, eds. Angola: The Weight of History . New York: Columbia University Press, 2008.

Chr. Michelsen Institute (CMI). Various papers on Angola. Bergen, Norway. http://www.cmi.no/research/country/?angola.

Oliveira, Ricardo Soares de. Oil and Politics in the Gulf of Guinea . New York: Columbia University Press, 2007.

Shaxson, Nicholas. Poisoned Wells: The Dirty Politics of African Oil . New York: Palgrave Macmillan, 2007.

Sogge, David. Angola: "Failed" yet "Successful" . Working Paper 81. Madrid: FRIDE, 2009.

Vidal, Nuno with Patrick Chabal (eds.) Southern Africa: Civil Society, Politics and Donor Strategies. Angola and its Neighbours . Luanda and Lisbon: Media XXI & Firmamento with University of Coimbra, Catholic University of Angola and Wageningen University.

Comments

Angola successfully fighting poverty

Title: Angola successfully fighting poverty
Author: Afrol news
Category: Angola
Date: 6/15/2010
Source: Afrol news
Source Website:

African Charter Article# 15: Everyone shall have the right to work under satisfactory conditions, receiving equal pay for equal work.

Summary & Comment: A new survey with UNICEF show some improvement since 2002 in social factors among the people. In 2002 figures were very low, as the war had just ended. Other questions could be asked, but some credit must be given. JK

Angola successfully fighting poverty

afrol News, 15 June - Despite poor a transparency and democracy record, Angola has managed to translate its oil-driven economic boom into human development and poverty reduction a new nation-wide survey shows.

Preliminary data from the first nation-wide survey to collect development indicators since the end of Angola's long-running civil war demonstrate that living standards are rapidly improving in the country.

The Angolan government and the UN's children agency UNICEF jointly conducted the first-ever Multiple Indicator Cluster Survey, which found that progress has been made in five of the eight Millennium Development Goals (MDGs): malnutrition; education; gender balance; child survival and malaria; and HIV/AIDS.

Since 2002, malnutrition has dropped from 35 to 23 percent, while school enrolment has surged to 76 percent.
Gender parity is close to being achieved in schools, with 98 girls for every 100 boys attending classes.

Meanwhile, child survival has been on the upswing, improving by nearly 20 percent, while the proportion of child death due to malaria has fallen to 23 percent.
Koen Vanormelingen, UNICEF's Representative in Angola, told reporters today in Geneva that these improvements were due to the consistent oil-driven economic growth that the country has experienced since 2002. Also accelerating progress towards reaching the MDGs had been the government's rehabilitation and revitalisation efforts, with 30 percent of the state budget being earmarked for the
social sector.

But he pointed to some setbacks, especially in maternal mortality, which had not seen the same level of improve as other areas, mainly because skilled attendance at birth continued to hover just below 48 percent.

Also, despite improvements in schools, only 35 percent of Angolan children finish primary school on time, and there was still a backlog of people who had not been able to receive educations during the 27-year war, which ended in 2002.

Mr Vanormelingen also noted that the water and sanitation sector had experienced a step backward, with only 42 percent of people having access to safe and drinkable water and 60 percent to basic sanitation. "Combined with continued poverty and disparity, this could jeopardise the gains made in child survival and development," he cautioned.

One of the key reasons holding Angola - which ranks 143rd out of 158 nations in the 2009 Human Development Report - back from stepped-up success in achieving the MDGs, the UNICEF official said, was the fact that nearly 90 percent of Angolans live in slums.
The country, Mr Vanormelingen explained, had completed the relatively easier task of rebuilding institutions and infrastructures, but now must tackle the challenge of improving its human capital.

He stressed that, as agreed with the International Monetary Fund (IMF), the Angolan government should continue its high level of investment in the social sector, but also enhance resource allocation to reduce poverty and in bolstering young people's skills.

Nevertheless, the progress in Angola since the end of the long civil war has been faster than most observers expected. Angola was predicted to fall into the "oil curse" after the war, with most revenues from the booming sector only being channelled to a small, wealthy minority of businessmen close to the political leadership.

Angola has often been criticised for lack of transparency in its oil and mining sectors, with corruption being very widespread in the country. Also, democratic institutions and press freedom - key checks to government spending - have developed very slowly in Angola.

During the last decade, Angola's rapid development of the oil sector and revitalisation of the mining sector led to double-digit growth rates most years. But by 2009, the non-oil sector has developed into the motor of new growth in the country.

Contrasting many other poor countries with a large oil wealth and underdeveloped democracies, Angola's economic growth to a large degree has been invested into poverty reducing efforts. The progress recorded in the nation-wide development indicators survey nevertheless comes as a small surprise.

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