Angola’s Transition to Technocracy Won’t Be Victimless

The biggest challenge for Angola’s new president will be escaping the shadow of his predecessor — and the corrupt cronies around him.

BY ALEX VINES-AUGUST 25, 2017

Africa’s second-longest serving leader, Angola’s President José Eduardo dos Santos, is finally stepping down after almost 38 years in power. But the peaceful, multiparty election on Aug. 23, which defense minister and dos Santos ally João Lourenço won easily, doesn’t quite mark the end of an era in the cloistered southern African oil giant; rather, it’s the beginning of an uncertain transition period. This is political change, Angola-style — gradual and calculated, a bit disorganized, and likely to progress in fits and starts.

There is no mistaking the significance, however, of Dos Santos’s departure from the presidential palace. He has ruled for longer than most Angolans have been alive, leading the country through a 30-year civil war that ended in 2002 and a hydrocarbon-fuelled boom that transformed the capital of Luanda into a maze of skyscrapers that was until recently among the most expensive cities on Earth.

The boom made many of the president’s allies and family members fabulously wealthy — his daughter Isabel, who heads the state oil company, is reportedly the richest woman in Africa — but the bust that came with the collapse of oil prices in 2015 plunged the country into economic crisis. Lourenço will have to chart a course to economic recovery, including tackling corruption and diversifying the economy, that does not threaten allies of the president who have enriched themselves over decades.

The transfer of power has been several years in the making, and was originally planned for 2018. But the 74-year-old president’s deteriorating health, coupled with fears that the ruling party could pay an electoral price if Dos Santos sought re-election yet again this year, necessitated an expedited transition.

Who would eventually succeed Dos Santos has been the source of speculation for decades

Who would eventually succeed Dos Santos has been the source of speculation for decades; occasionally, the president would slyly encourage aspirants to reveal their ambition before ensuring they were politically neutered. For a time, it appeared he was considering dynastic succession, favoring for a short period one of his sons, José Filomeno de Sousa dos Santos, to replace him. But he quickly dropped the idea due to significant opposition from within the MPLA, the nominally socialist party that has governed Angola since it gained independence from Portugal in 1975. Over his nearly four decades in office, Dos Santos sought to weaken the MPLA and centralize power around himself through a vast system of political patronage. But as his health weakened over the last couple of years, the MPLA began to reassert itself, forcing the president toward a compromise candidate that was agreed upon behind closed doors.

That candidate was Lourenço, a 63-year-old army general who is untainted by corruption allegations. He enjoys a technocratic reputation for efficiency, as does his wife, Ana Dias Lourenço, an ex-minister who has been Angola’s representative to the World Bank and to the African Development Bank. Lourenço’s victory on Aug 23 — the MPLA appears to have garnered 61 percent of the vote with 98 percent of ballots counted (although the result has not yet been verified) — is just the first step toward consolidating power. The second would be holding an extraordinary party congress at which he replaces Dos Santos as the MPLA party president. MPLA insiders say this could happen as soon as December, since Dos Santos’s health is unstable and he has had to seek unplanned medical care in Spain several times this year.

Though he is stepping aside, Dos Santos will not walk into an uncertain Angolan sunset. He is protected by legislation that shields him from future prosecution. His military, police, and intelligence chiefs are also protected by a new law enacted in July that guarantees their jobs under the new administration. Dos Santos will also sit on the Council of the Republic, a presidential advisory body whose members enjoy immunity from prosecution. In addition to the significant private wealth he has amassed during his presidency, the council seat will afford him first-class travel and many other perks.

According to senior MPLA officials, Dos Santos has told a number of his ageing generals that they should follow his example and retire with dignity. But some in his inner circle, including members of family, may feel less confident about their future than Dos Santos does. Many have amassed significant wealth and built up businesses using their presidential pedigree. Without the official immunity enjoyed by Dos Santos, they could lose some of their fortunes.

Among those with uncertain futures is Welwitschia José dos Santos Pego, a daughter of the president whose job as a manager at the state television channel TPA 2 and status as a shareholder in Banco Prestigio, an Angolan bank, could be scrutinized even as her future within the ruling party seems secure. The same goes for José Filomeno dos Santos, the president’s son, who serves as chair of the country’s $5 billion sovereign wealth fund. Other family members are in media and hospitality, such as singer and soap opera producer José Paulino, known by his stage name Coreon Du. Another younger son of Dos Santos, Eduane Danilo dos Santos, attracted press attention in May after he bought a watch at a charity auction for more than $500,000. The most famous of Dos Santos’s children is his eldest daughter Isabel, who according to Bloomberg’s Billionaire’s Index is Africa’s richest woman. In addition to leading the state oil company Sonangol, she has investments in agribusiness, telecommunications, cement, and banking.

In the longer term, some of the businesses controlled by the president’s family could come under increased scrutiny, particularly if Dos Santos’s health deteriorates further or he dies, and is thus unable to protect them.

There have already been several probes into Angolan state-linked business deals in in Portugal, China, and the United States.

There have already been several probes into Angolan state-linked business deals in in Portugal, China, and the United States. In his final press conference before the elections, Lourenço promised to combat graft but stopped short of offering assistance to international prosecutors who he said were sometimes politically motivated. Asked whether he could guarantee that under his government graft would be prosecuted even among the political elite, Lourenço replied, “That guarantee I give…. The law is for everyone.”

Pressure to fight corruption — and the perception that elites are living large off ill-gotten gains while ordinary Angolans suffer — is heightened by the economic downturn. Angola’s economy, which, after years of rapid growth contracted 3.6 percent in 2016, has been badly hit by crude prices that have halved since 2014 and by a shortage of foreign currency that has forced many firms to downsize. This has been compounded by the unwillingness of many international banks to lend to their Angolan counterparts out of fear of political exposure. There are signs that several politically connected shareholders have read the writing on the wall and tried to unload their stake in Angolan banks. So far they have been unable to find credible buyers.

Just as important as rooting out graft will be investing in the hydrocarbon sector and eventually developing other viable industries, such as agriculture and tourism. Angola’s offshore petroleum industry currently accounts for 50 percent of GDP and 75 percent of government revenues. But oil production will peak in 2019, after which it is projected to decline by 11 percent each year, unless new oil fields are developed.

Now that the elections are over, Angola is likely to devalue its currency and seek help from the International Monetary Fund. Dos Santos will be remembered for ending three decades of civil war and uniting the country. Lourenço wants to be remembered as the leader who successfully reformed Angola’s economy. And to consolidate power, he will need to show results quickly.

Image credit: AMPE ROGERIO/AFP/Getty Images