‘Angola an opportunity not to be missed’

Angola is one of the trade opportunities in Africa that must be recognised by SA exporters, according to Duncan Bonnett of trade consultancy, Whitehouse & Associates. It’s certainly difficult to enter because it’s expensive to do business there, he told FTW. “You need to be aware of the problems, because even the logistics into Angola is very difficult. But it’s a very rewarding market once you’re there.” According to Bonnett’s figures, SA exports into Angola have almost doubled since 2005. The total for 2005 was R3.5-billion, and the January-to- November 2008 total was R6.6- bn (“Close to R7-bn for the full year,” Bonnett noted). “If you look at that part-year figure for 2008, our exports were up 22% (by about R1-bn) on the full-year in 2007,” he added. “That’s pretty impressive in a global economy staring into an abyss, and would suggest that there’s still a lot of business in Angola.” The major point about Angola is that it’s entirely importdependent. “Angola is an opportunity that just can’t be missed,” said Bonnett. “We can export across the range – from chemicals, motor vehicles, electronic and electrical equipment and white goods to spare parts and supermarket goods in general.” SA’s not on its own in taking advantage of this high import demand. “There’s lots of interest in Europe, for example,” said Bonnett, “and, of course, the Chinese involvement.” He also emphasised that there were still lots of projects going into Angola, and these themselves generated lots of export opportunity. “At first they need imports of the likes of steel and other metals, and other goods and equipment in the construction category,” Bonnett told FTW. “Then in the operational stage, they’ll need all sorts of spares, extra equipment and materials, and their economic activity will generate import demands from third-party suppliers to the project and more regional consumer spend.” Angola’s main problem of the moment is that, as an almost entirely oil-dependent exporter, its economic health is very closely linked to the global oil market – and that’s in a depressed state at the moment. According to a Reuters report earlier this year, the Organisation of Petroleum Exporting Countries (Opec) cut production by 4.2-million barrels-per-day (bpd) in January to prop up oil prices, which had collapsed by more than US$100 a barrel from a record high of US$147.27 in mid-2008 as the global economic downturn eroded demand. Angola’s share in this production cut was over 200 000-bpd, but the actual export output is expected to be around 1.62-m bpd of crude oil through February, and its anticipated exports for March and April remain steady at the same figure. While this would suggest that Angola’s economy has collapsed, there is still a lot going on in the country, according to Bonnett. “One shouldn’t take a jaundiced view of the opportunities in Angola,” he said. “It’s still a very exciting market.”