Doing business in Angola can be extremely challenging and foreign companies need to do their homework before entering the market. How we made it in Africa asked Roger Ballard-Tremeer, Hon Chief Executive of the South Africa – Angola Chamber of Commerce, about Angola’s business environment.
Besides the oil and gas industry, which sectors of Angola’s economy hold the most potential for investment?
The oil and gas sector still dominates the Angolan economic scene and will continue to do so until the reserves run out unless the plans for economic diversification by 2025 come to fruition. In my view the export of technologies and related expertise into all the sectors of the Angolan economy, including the oil and gas sector, holds the most promise. Provided that one makes absolutely sure that one is export ready specifically for the Angolan market, this approach can also be the lowest risk route into the Angolan market. So I see trade rather than investment as offering the lowest risk route into the Angolan opportunity.
What are the biggest risks involved when investing in Angola?
The Angolan market is an ultra-challenging one. The biggest risks involved are daring to plunge into the Angolan market uninformed (or, worse still, misinformed); failing to conduct one’s due diligence obligations to your own company at an ultra-level; and failing to exercise one’s obligation of due care to your own company at an ultra-level and therefore charging in “in bad faith”. To do so is to fail one’s Angolan partners as well as oneself.
What are the most common misconceptions about Angola held by foreign business people?
Too often foreigners hear about business development practices that may have been valid in the pre-2002 Angola but which, eight years later in 2010, no longer hold water. The practice of using influence-peddlers and agents to bribe one’s way into business may have been used in the past in Angola but they are now considered corrupt practices and are illegal both in Angola and throughout the Southern African Development Community (SADC). According to President José Eduardo dos Santos there is now “zero tolerance for corruption” in Angola.
Is it necessary to take-on a local partner when investing in Angola?
In certain strategic sectors there is a legal obligation to take on a local partner, in others this is not so. It can be very good business practice to seek out a local partner that can add value to one’s business. It is profoundly bad practice to seek out a business partner that can only subtract value from one’s business.