As part of the first phase of the Propriv initiative, Angola’s Government sought to privatize 195 state-owned companies – with 32 of them considered as major national companies – and assets between 2019 and 2022. During this four-year period, 96 companies were successfully privatized, raising $1.13 billion through public tenders, public auctions, and Initial Public Offerings (IPOs).
The Government expanded the program in May 2023, with 73 additional assets and companies poised for privatization by 2026. Under the second phase, processes to privatize insurance company, ENSA – Seguros de Angola; telecommunications companies, Unitel and TV Cabo; and national financial entity, the Angola Development Bank started in 2023, while privatization of country’s national airline, TAAG; agro-industrial company, Aldeia Nova; diamond firm, Endiama; and National Oil Company (NOC), Sonangol, will be targeted in 2024.
Angola’s Government aims to finalize the privatization of 31 assets by Q4 2023, and is also working on privatizing 11 Sonangol processes, with plans to exit the company by 2027. What’s more, the Government is planning to privatize seven additional assets in the country’s Luanda-Bengo Special Economic Zone.
Following his election in 2017, Angola’s Head of State, H.E. President João Lourenço moved decisively to implement wide-ranging legal reforms and other measures to reduce the country’s reliance on oil resources. As such, the Government approved a roadmap detailing steps and procedures to fast-track the country’s privatization efforts, including through public tenders, limited tenders and IPOs on the stock exchange. The initiative is expected to receive funding through the expansion of oil production combined with the proceeds derived from the sale of the approximately 200 state-owned enterprises across a wide array of industries to the private sector.
An increased focus on foreign and domestic investment has the potential to improve the ease of doing business in Angola and the development of its private sector. Meanwhile, developing additional infrastructure and industries could enable Angola to diversify its income while creating a stable private investment environment, thereby boosting employment and economic growth.
Furthermore, Angola’s vast privatization program is being carried out within the framework of global development institution, the International Finance Corporation, thus ensuring an appreciable quality certification and thereby reassuring foreign investors. Consequently, the Propriv initiative is also poised to improve economic reform towards free markets, thus increasing competition between companies while reducing barriers to entry into markets and incentivizing strict management discipline, rationalized investment, and optimization of asset value.
In essence, Angola’s privatization efforts are expected to contribute towards the structuring of flourishing markets within the country. Blessed with a wide range of natural resources and a fertile climate, Angola ranks amongst the top exporters and importers in the sub-Saharan region, thus enabling investors to tap into major projects while contributing towards increased investment, economic growth, and socioeconomic development.
This and more will be unpacked at the Angola Oil and Gas 2023 Conference and Exhibition. This year’s edition will be held in Luanda from September 13-14, under the auspices of the Minister of Mineral Resources, Oil and Gas, H.E. Diamantino Pedro Azevedo.