Angola is emerging as a compelling destination for investors seeking opportunities in Africa. With its rich natural resources, strategic location, and commitment to economic diversification, Angola offers a unique blend of prospects across various sectors.
Angola is estimated to rank 66th globally in terms of nominal Gross Domestic Product (GDP), with an approximate value of $113.29 billion. When considering Purchasing Power Parity (PPP), which accounts for cost of living and inflation rates, Angola's GDP is estimated at $541 billion, placing it 59th worldwide. Within Africa, Angola stands as the 8th largest economy based on nominal GDP.
The Angola Debt and Stock Exchange, known as BODIVA (Bolsa de Dívida e Valores de Angola), is central to Angola's efforts to diversify its economy beyond oil dependence. Established in 2014 and headquartered in Luanda, BODIVA facilitates trading in public and corporate debt instruments, as well as equities.
BODIVA has seen a gradual increase in listings, with notable developments including:
Banco Angolano de Investimentos (BAI): In 2022, BAI became the first company to list shares on BODIVA, offering a 10% stake through an initial public offering (IPO).
BODIVA's Own IPO: In December 2024, BODIVA offered 30% of its shares to the public, aiming to broaden ownership and enhance market participation.
Looking ahead, BODIVA plans to increase the number of listed companies from four to ten by 2027, with anticipated listings from major state-owned enterprises such as Sonangol (oil), Endiama (diamonds), Unitel (telecommunications), and Banco de Fomento Angola.
To enhance its operations and align with international standards, BODIVA has undertaken several initiatives:
Technological Upgrades: Implementing advanced trading and settlement systems to improve efficiency and transparency.
International Collaborations: Establishing partnerships with other exchanges, such as the Ethiopia Commodity Exchange, to share best practices and explore cross-listing opportunities.
Regulatory Reforms: Working with the Angolan government to streamline listing procedures and enhance investor protections.
Despite progress, BODIVA faces challenges, including:
Market Liquidity: Limited trading volumes and investor participation.
Economic Volatility: Fluctuations in global oil prices impacting investor confidence.
Nevertheless, BODIVA remains committed to its role in Angola's economic diversification, aiming to attract both domestic and international investors and foster a robust capital market.
AOA Angolan Kwanza (AOA) is the official currency o the country and issued by Banco Nacional de Angola (BNA)
The Banco Nacional de Angola (BNA) has maintained its benchmark interest rate at 19.5% since May 2024, marking the sixth consecutive meeting without a change. This decision reflects the central bank's cautious approach amid global economic uncertainties, despite a gradual decline in domestic inflation
Economic Landscape and Diversification Efforts
Historically reliant on oil, which accounts for over 90% of exports and 60% of fiscal revenues, Angola is actively pursuing economic diversification to ensure sustainable growth. In 2024, the country's economy rebounded with a 4.4% growth rate, the highest since 2014, driven by sectors such as agriculture, mining, and services. Projections for 2025 indicate a 3.61% growth, with non-oil sectors contributing significantly.
Key Investment Sectors
Agriculture and Agribusiness
Angola's vast arable land and favorable climate position it as a potential agricultural powerhouse. The UNDP's SDG Investor Map identifies opportunities in grains, pulses, tropical fruits, coffee, fisheries, and poultry. Investments in these areas can enhance food security and reduce import dependence.
Renewable Energy
To address energy deficits and promote sustainability, Angola is investing in renewable energy projects. Notable initiatives include:
Caraculo Solar Power Station: A 50MW project in Namibe Province, with 25MW already operational.
Luena Solar Power Station: A 26.91MW facility under construction in Moxico Province.
Quilemba Solar Power Station: A planned 35MW plant in Huila Province, developed by a consortium including TotalEnergies.
These projects aim to diversify the energy mix and expand access to electricity.
Infrastructure Development
The Lobito Atlantic Railway, a joint venture involving Trafigura and Mota-Engil, is revitalizing the Benguela railway corridor, enhancing connectivity between Angola, the Democratic Republic of Congo, and Zambia. This infrastructure is pivotal for trade and regional integration.
Mining and Minerals
Angola's mineral wealth extends beyond oil, encompassing diamonds, gold, and rare earth elements. The government is actively seeking investments in mining to diversify exports and stimulate economic growth.
Investment Climate and Reforms
Angola has implemented several reforms to improve its investment climate:
Legal Framework: Revisions to investment laws have streamlined procedures and enhanced investor protections.
Economic Diversification Support Program (EDSP): Supported by the African Development Bank, this program aims to promote private sector-led growth and job creation.
Digital Platforms: The launch of the "Invest in Angola" platform by AIPEX provides investors with comprehensive information on opportunities and procedures.
Strategic Partnerships and International Engagement
Angola is engaging with international partners to bolster its development:
U.S.-Angola Commercial and Investment Partnership (CIP): A collaboration to facilitate private sector-led trade and investment between the two countries.
Partnership for Global Infrastructure and Investment (PGI): A G7 initiative supporting infrastructure projects like the Lobito Corridor to enhance regional connectivity.
Conclusion
Angola's commitment to economic diversification, coupled with its resource endowments and strategic reforms, presents a compelling case for investment. Sectors such as agriculture, renewable energy, infrastructure, and mining offer substantial opportunities for investors seeking to engage in a dynamic and evolving market.
This article is intended for informational purposes only and does not constitute investment advice or a solicitation to buy or sell securities in Angola or elsewhere. While efforts have been made to ensure accuracy, no guarantee is given regarding the completeness or reliability of the information provided. Investors should conduct their own due diligence and consult with a qualified financial advisor before making any investment or portfolio decisions.
Rainer Michael Preiss, Partner & Portfolio Strategist at Das Family Office in Singapore
