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Angola’s Oil-Soaked Kleptocracy Is an Empire Built on Inequality
August 26, 2015 By Josh FengIsabel dos Santos, the daughter of Angolan President José Eduardo dos Santos and the richest woman in Africa, owes her wealth to the oil industry. Delfina Fernandes, a woman living in abject poverty in the village of Kibanga, uses gasoline as an anesthetic to dull the sheering pain of her rotting teeth.
The startling contrast between the two women’s lives and their connection to Angola’s oil is highlighted in recent reporting by Nicholas Kristof. Kristof joins Michael Specter of The New Yorker in a surge of coverage on extreme inequality in this South African country.
Oil accounts for more than 95 percent of exportsIn a three-part series for The New York Times, Kristof juxtaposes visceral imagery of rural poverty with lavish hedonism in the country’s capital. For example, while GDP has increased 465 percent over the past decade, Angola’s child mortality rate remains one of the highest in the world. Luanda is the most expensive city in the world for expats to live, according to an annual survey by the global consulting firm, Mercer, beating out the likes of Hong Kong and London. Specter investigates different expat experiences in the capitol city, ranging from the lavish lifestyle of Texas oilman Steve Eispinosa, to Tako Koning, a Canadian petroleum geologist who volunteers in Angolan schools and engineering societies.
Reporting by The New York Times, New Yorker, and others gives readers a glimpse at the modern challenges facing the country that helped coin the term “resource curse.”
A Fragile State of Growth
Specter describes Luanda as a city in the midst of rapid transformation. Over the past decade, a sandy split off the city’s coast called Ilha de Luanda, formerly frequented only by fishermen, was converted into a luxury-hotel-lined boulevard. Luanda’s skyline is dotted with towering construction cranes and skyscrapers, symbols of breakneck post-war development fueled by booming oil extraction.
According to the Organization of Petroleum Exporting Countries, oil production and its supporting activities contribute about 45 percent of the nation’s gross domestic product and more than 95 percent of exports. With so much wealth concentrated in one sector, an oil oligarchy absorbs much of the country’s growth and increases its vulnerability to global oil price shocks.
Rent in Luanda’s city center can easily exceed $10,000 a month and a bottle of Coke can cost $10, but most Angolans live on less than $2 a day. The country ranks a dismal 149th out of 187 in the Human Development Index.
Rent in Luanda can exceed $10,000 a month, but most Angolans live on less than $2 a dayIn tandem with dropping oil prices, GDP growth rates stagnated in 2009, hitting the poorest hardest. “A man working as a poorly paid security guard will have to spend $12 a day to get to his job, but he will only earn $200 to $300 a month. He is paying to go to work,” Rafael Marques de Morais, an Angolan journalist and human rights activist, tells the Daily Mail.
The striking inequality might be explained as a classic example of the resource curse – how valuable natural resources sometimes lead to more instability and poverty rather than development. Though a growing body of research suggests that the effect may not be as strong as previously believed, single commodity-powered economies do lie on shaky ground. Gustavo Costa, the Luanda correspondent for the Portuguese newspaper Expresso, told Specter in an interview, “The government has built a certain kind of society – for themselves. You can call it prosperity if you want, but it is incredibly fragile. It all could end tomorrow.”
Ensnared in a Web of Corruption
The origins of Angola’s current situation stretch back to historical conflicts. In 1975, Angola gained independence from Portugal after more than 300 years of occupation, only to launch immediately into a bloody 27-year-long civil war. Angola’s abundant natural resources fueled warring factions backed by foreign powers eager to battle out Cold War ideologies on a sub-Saharan battlefield. By using oil to fund counter-insurgency programs during the Civil War, the People’s Movement for the Liberation of Angola learned how to exploit this resource for political leverage.
Today, the party still maintains a strategic chokehold over the country by capitalizing on the oil sector, while foreign investors pull the strings on the oil industry, perpetuating injustices that are less visible than wartime violence but still costing lives.
About 70 percent of the world’s resource-rich states are autocracies, according to the Africa Center for Strategic Studies. The steady flow of natural resource revenues maintains the patronage and security structures autocratic governments need to maintain power. Angola is a prime example, placing a dismal 161st out of 174 countries assessed by a corruption index released by Transparency International, declining from its 158th ranking in 2008 and 142nd ranking in 2006.
In fact, lack of transparency in Angola’s oil industry sparked the formation of the Extractive Industries Transparency Initiative (EITI), a major multilateral organization promoting open and accountable management of natural resource monies around the world. There are currently 48 implementing countries signed on to EITI and 31 countries compliant with EITI requirements – but not Angola.
“There were no doctors or nurses…we had to use medicine made from roots”Corruption prevents much foreign aid from reaching its intended recipients. In a short film that accompanies his reporting in the Times, Kristof explains that although the government supposedly offers free family planning services and clinics are packed with women requesting contraception, hospitals are not receiving the medicines they ordered. Kristof reports that some drugs intended as donations to those in need, like anti-malarial tablets, are being sold for profit on the black market instead. A nurse Kristof interviewed blames the shortage on falling oil prices, though the effect of such shortfalls is not evident in the capitol.
For other women, the health system is nonexistent. Delfina Fernandes has never heard of family planning and the only clinic in her region has been shut down for at least a year. “There were no doctors or nurses,” she says, “so we had to use medicine made from roots. That’s all we could do, and it didn’t work.” Fernandes has lost 10 of her 15 children.
Kristoff calls for foreign donors to be more vigilant and attentive to where their money is flowing. He criticizes not only “the West,” but also the recent influx of Chinese investors for perpetuating corrupt institutions rather than dismantling them. He recalls the power of Richard Holbrooke, U.S. ambassador to the United Nations at the time, in freeing the anti-corruption journalist Rafael Marques de Morais from prison in the 1990s, and scrutinizes U.S. complacency in the current situation as the country continues to ally itself with Angola and effectively turn a blind eye to inequality.
But he also points out that responsibility goes both ways: “I’ve often criticized Western countries for not being more generous with aid. Yet it’s equally important to hold developing countries accountable.”
A New Generation, A New Hope?
Kristof and Specter’s stories have garnered more visibility for an issue often written about, but nevertheless largely ignored.
While some have heralded Kristof’s reporting as “stunning,” others are more critical. Marissa Moorman, an Africa historian, wrote a scathing review criticizing the lack of Angolan voices in his coverage. In particular, she points out that there has been a youth movement protesting President Jose Eduardo dos Santos’ 32-year rule since 2011.
Specter does include the voices of some young Angolans in the country’s capital, albeit those afforded a certain level of wealth and privilege. The three young people he interviews acknowledge multiple times that their education and relative prosperity are far from typical. Antonio was educated at several of Luanda’s best international schools and is now employed by a major oil company. His friend Pedro also graduated from premier schools, while another friend, Marisa, attended college and business school in Europe. “The three, all in their thirties, agreed that although they might prefer to live abroad, there has never been a better time to be a well-educated Angolan,” writes Specter.
Yet, the young professionals are critical of a government that clamps down on opposition despite constitutional protections of freedom of speech and assembly. “He kind of owns the country,” says Pedro on President dos Santos. “People almost can’t look him in the eyes – he’s that powerful.”
Even with the threat of state repression, many young people are at the forefront of change. A short 2012 Al Jazeera documentary highlighted the role of the underground rap scene in fueling youth resistance. Luaty Beirão, an Angolan rapper also known as Ikonoklasta, was arrested at a demonstration in 2011.
“Mr. Danilo, if you are here,” he rapped, referring to one of the president’s sons, “go tell your daddy, tell him please, we do not want him here anymore. Thirty-two [years] is too much!”
Sources: Africa Center for Strategic Studies, Africa Is a Country, Al Jazeera, British Broadcasting Corporation, Center for Chinese Studies, Daily Mail, The Economist, Electoral Institute for Sustainable Democracy in Africa, Extractive Industries Transparency Initiative, Global Witness, Huffington Post, Human Rights Watch, New York Times, New Yorker, Organization of Petroleum Exporting Countries, PBS Newshour, Reuters, Transparency International, United Nations Development Program, World Bank.
Photo Credit: Construction in Luanda’s city center, courtesy of Herculano Coroado/Reuters. Video: The New York Times.