Angola 'Failed' yet 'Successful' - FRIDE

Angola‘Failed’ yet ‘Successful’David Sogge81Working Paper / Documento de trabajoApril 2009Working Paper / Documento de trabajo

About FRIDEFRIDE is an independent think-tank based in Madrid, focused on issues related to democracy and human rights; peaceand security; and humanitarian action and development. FRIDE attempts to influence policy-making and inform publicopinion, through its research in these areas.Working PapersFRIDE’s working papers seek to stimulate wider debate on these issues and present policy-relevant considerations.

Angola‘Failed’ yet ‘Successful’David SoggeApril 2009David Sogge (b. 1947) works as an independent researcher in the fields of African and International studies. Heis based in Amsterdam, where he is an associate of the Transnational Institute. Formally educated at HarvardCollege, Princeton University and the Institute of Social Studies, his professional experience in Angola began in1985. Among his publications about that country are a book, Sustainable Peace (1992), and numerous articlesand research monographs, including two published by FRIDE: Angola: Global ‘Good Governance’ Also Needed(2006) and Angola: Empowerment of the Few (2007).81Working Paper / Documento de trabajoApril 2009Working Paper / Documento de trabajo

FRIDE forms part of the initative for peacebuilding: www.initiativeforpeacebuilding.euThis paper is published with the support of the Ford Foundation.The author would like to express warm thanks to Dr. Nuno Vidal of Coimbra University (Faculdade de Economia eCentro de Estudos Sociais) for his insight and support, particularly during fieldwork in Luanda, and to FRIDE staffMariano Aguirre and Ivan Briscoe for their support and advice.Cover photo: GIANLUIGI GUERCIA/AFP/Getty Images© Fundación para las Relaciones Internacionales y el Diálogo Exterior (FRIDE) 2009.Goya, 5-7, Pasaje 2º. 28001 Madrid – SPAINTel.: +34 912 44 47 40 – Fax: +34 912 44 47 41Email: fride@fride.orgAll FRIDE publications are available at the FRIDE website: www.fride.orgThis document is the property of FRIDE. If you would like to copy, reprint or in any way reproduce all or anypart, you must request permission. The views expressed by the author do not necessarily reflect the opinion ofFRIDE. If you have any comments on this document or any other suggestions, please email us atcomments@fride.org

VExecutive summaryThis paper considers the case of Angola as aninstitutionally weak state. It is intended to contributeto the research project Institutionally Weak States:Context, Responsibilities and Responses, undertakenby the Peace, Security and Human Rights departmentof FRIDE.The analysis seeks to respond to key questions aboutAngola posed in the project’s guiding purposes andmethodology. These appear in three clusters:1. What are the historical taproots of conflict inAngola, and of its weak uneven state and politicalinstitutions?2. What formal and informal forces and incentives areat work in Angola’s territorial political economythat affect state and political resilience orweakness?3. What aspects of the integration of Angola’s politicaleconomy into international systems may help explainthe persistence of weak state and politicalinstitutions?After addressing these questions, the paper suggestsways European and other international decisionmakersmight look afresh at notions of state weaknessin general, and at the case of Angola in particular.Studying the Angolan case may contribute to policyabout weak states, but perhaps not along customarylines.1 USAID/Iris Center 2004, Proposed Typology in Order to ClassifyCountries Based on Performance and State Capacity, College Park: IrisCenter, University of MarylandFirst, the Angolan case suggests the limited value ofscoring and ranking states, as if they were commoditiesor football clubs. For example, influential think-tanksin the USA have classified post-war Angola as acompletely ‘failed state’, 1 a ‘severe’ case of a lowincomecountry under stress 2 and most recently as a‘critically weak’ state, 11 th of the world’s current worstcases. 3 Yet another high-profile forum, Foreign Policymagazine, has for years rated Angola as well outsidethe ranks of the seriously weak and unstable. Givenappeals for clarity and consensus among Westernpolicy elites, this discord and confusion about animportant client state is noteworthy.Second, the Angolan case suggests that confiningattention to politics ‘onshore’ leads to explanatorydead-ends. That is because Angola’s political economyis extraverted. Key processes take place ‘offshore’, insupra-national realms. Drawing attention to theextraversion of places like Angola is all the moreimportant because influential ‘expert’ organisationslike the World Bank consistently fail to do so. 4Third, Angola’s case suggests the need to probecommon assumptions like the ‘resource curse’. Manyhold that oil revenues trigger bad politics andinstability; among cruder versions is that of a punditof the Financial Times: ‘The very presence of oilturns law-abiders into thugs, and pushes nationsbackwards into chaos.’ 5 Yet recent comparativeresearch finds that oil wealth, on the contrary, tendsto stabilise regimes. Hence pursuit of general ‘lawsof petro-politics’ is a dead end; it is more useful tolook for patterns case by case in their social andhistorical settings. Angola may show signs of ‘pathdependence’, but oil was only one factor laying downthe path.Fourth, and perhaps most urgently, the case of Angolacalls attention to democratic deficits generated by thehydrocarbon industry not only in fragile peripheralstates but also in advanced industrialised countries. It2 World Bank IEG 2006, Engaging with Fragile States. AnIndependent Evaluation Group Review of World Bank Support to Low-Income Countries Under Stress, Washington, D.C: World Bank3 Rice, S. and S. Patrick 2008, Index of State Weakness in theDeveloping World, Washington DC: Brookings Institution4 See for example Harrison, G. 2005, ‘The World Bank, Governanceand Theories of Political Action in Africa’, British Journal of Politicsand International Relations, 7, 240–2605 Amity Shlaes, ‘In Poorer Nations, Oil Resources Can Be a CurseUpon the People’, Financial Times, 20 June 2004Angola: ‘Failed’ yet ‘Successful’David Sogge

VIillustrates the power of the oil industry – and thenational elites who depend on it – to corrupt andundermine the legitimacy of whatever political systemit touches. Yet rules and institutions governing globalfinancial flows, tax regimes and the environmentcontinue being shaped to suit corporate interests,especially those of the hydrocarbon industry. The risksto democracies young and old are serious.This paper draws on research and commentary byothers, and on information and views obtained in 2008by the author in interviews with Angolans, andspecialists working on issues such as revenuetransparency and human rights.Working Paper 81

ContentsGlobalised Angola – the past 1Overt and structural violence 1Economic discontinuity and polarisation 2Weak and illegitimate political institutions 2Social identities and inequalities 2Conclusion 3Globalised Angola – the present 4Oil and geopolitics 4Other extractive industries and land 6Integration in trade and investment 7Financial integration 8Political integration 9Military and security integration 11Integration – conclusion 12Angola’s onshore political economy 12Military and security systems 12Politics onshore 14Economic growth, political sociology and state resilience 17Conclusion 20Ways forward 22Coherence in Western policy and global governance 22A wider view 22A longer-term view 23Enabling a responsive state 23

1Globalised Angola –the pastWhat forces have driven Angola’s emergence as anation and polity? How have they shaped its economy,social identities and politics? This chapter offers ashort overview, laying out the background to laterchapters focused on the main research questions.Conventional wisdom holds that state fragility in Africastems chiefly from the inner drives of elites themselves.They are in the dock as greedy, corrupt, scornful ofsound policy and driven by primitive ethnic rivalries. Yetin a political economy like Angola’s, where Westerninterests have set the ground rules and incentives forfive hundred years, the power of such essentialist viewsto explain anything is not great. Angola’s polity may bebetter understood by assessing the interplay of anumber of factors:• unremitting violence, both overt and structural;• an economy geared to serve outside interests;• a state apparatus and politics based on generationsof dependent, territorially weak, militarised,centralised and corrupted processes designed forcolonial purposes and thus ipso facto antidemocratic;• inequalities generated by uneven and extraverteddevelopment;• public goods and services provided chiefly in responseto elites, and lacking any grounding in transparent,democratic processes;• a political space for associational life (‘civil society’)that is severely confined and largely de-politicised.Overt and structural violenceIn the twentieth century, Angola enjoyed only abouttwenty years without war. This was the period 1941to 1961, between the last colonial militarycampaigns and the first open anti-colonial revolts.However, Angolans in daily life have for generationsfaced less overt forms of violence: repression,alienation and preventable poverty. Such violencehelped subordinate colonial subjects and organise apredatory economy.In the four decades following 1960, Angola wentthrough spasms of open warfare, reaching crescendosin the 1980s and 1990s. Against such violence andchaos, Angolan citizens had few defenses; mosthunkered down, pursued survival strategies, especiallytaking flight across borders or to urban areas. Elitesfaced few incentives to end this disorder and many toturn it to their own advantage.Angola’s emergence to self-determination took placeamidst geo-political contention. First, facingsetbacks in Vietnam and insurgencies elsewhere, theUnited States sought to contain and roll backcommunism. It found itself typically wrong-footedwhen in 1974 its Portuguese client regime collapsed,largely under the burden of its wars in Africa.Second, facing new and successful assertivenessamong oil producing countries, the US governmenthad few hesitations about using force to set the termsof access to Angolan oil. Foreshadowing its invasionof Iraq three decades later, it opened a covert war inAngola, making use of regional proxies in Zaire andSouth Africa.Yet throughout this assault, corporate power took adifferent position. American corporations pumped andre-sold Angolan oil, furnished Angola with Boeingairliners and facilitated capital flight to Wall Streetand tax havens. By trading with the Angolan enemy,they easily recouped the hundreds of millions spent onmaking war against it.Today that US-led covert war to ‘roll back’ communismis referred to as a civil war -– thus airbrushing away itsgeopolitical drivers. While contentious politics in thepost-independence period were probably inevitable inAngola (as in many other African polities), theduration and destructive force of the conflict can onlybe understood by factoring in the geopolitics of thetime.Angola: ‘Failed’ yet ‘Successful’David Sogge

2Economic discontinuity andpolarisationThe hasty and vengeful departure of most Portuguesesettlers in 1975 and the onset of expanded warfaretriggered the collapse of most formal industry andcommerce. From a high degree of self-reliance, Angolabegan to import food and other basic goods, mainlythose needed by city dwellers. Small farmers faced a‘goods famine’, thereby reducing incentives and meansto produce surpluses. The war, and resulting forcedurbanisation, were the final blows to a sophisticatedcommercial agrarian economy. The post-colonialperiod might just as accurately be termed the ‘postagrarian’period.Turbulence and discontinuity have been Angola’s fate.Its leading exports (slaves, rubber, sisal, coffee) haveboomed, then gone bust. Its development strategies(captive dependency, import-substitution, settlementschemes, Soviet-style planning) have come and gone.These cycles left behind few capacities, traditions,infrastructure or institutions for periods that followed.There was little Schumpeterian ‘creative destruction’,as the losses swamped out the gains. What hasremained constant, however, is the commandingposition of foreign capital, allied with repressive andadministrative powers of the state.Weak and illegitimate politicalinstitutionsAngola’s systems of administration developedaccording to Portuguese law, custom andorganisational capacities. Those systems were weak.Under more than forty years of dictatorship and abizarre creed that the colonial order was legitimateand sustainable, government became more rigid,centralised and corrupted. In rural areas the state waspresent in only rudimentary ways, if it was present atall. Alongside formal institutions were many informalnorms of the Portuguese police state, claims ofprivilege by petty officials and grand corruption bysenior officials including the military. Apart fromchurches, sports clubs and a few charities, there was noformal associational life. Political activism in civilsociety was outlawed.Organised expressions of nationalism emerged amongintellectuals in Luanda and provincial towns. ViolentPortuguese counter-measures following spontaneousupheavals in 1960 and 1961 sent many nationalistsinto exile. Nationalist parties themselves showed littleinternal coherence or anchoring among Angolancitizens broadly. One Angolan political analyst put it asfollows:‘Although [ national parties’] programmes proclaimeddemocratic liberties as objectives of the struggle, noneof them conducted themselves in ways that wouldguarantee pluralism. […] Within each organisation,conditions of tolerance and openness to politicaldebate [were] nonexistent.’ 6In these and other ways, Angolan anti-colonial politicsforeshadowed the autocratic and violent political orderof the post-colony. The nationalist leadership inheritedno institutions or traditions on which to build aresponsive bond or social contract between citizensand the state. Even if economic collapse and war hadnot occurred, building such a new political order wouldhave posed immense challenges. But that positivescenario was eliminated from the outset; Angola’sinstitutional fragility was in this sense ‘overdetermined’.Social identities and inequalitiesUntil the late 1800s, Angola was not a country butmerely a string of coastal enclaves. Only in the 20 thcentury did its inland territory gain politicalboundaries and infrastructure. Several distinct zonesarose around crop and labour systems, transportcorridors and marketing networks. Out of fragmentedsocio-linguistic groupings, major ethnic blocscrystallised as follows (Portuguese estimates of each6 Gonçalves, J. 2003, O descontínuo processo de desenvolvimentodemocrático em Angola, paper presented at CODESRIA Conference,Gaberone, Botswana, 18/19 October 2003 [trans. D.S.]Working Paper 81

3one’s proportion of the country’s population in 1960are given in parentheses):a) in coffee-exporting north-western zones and theCabinda enclave, a diverse range of peoplesspeaking dialects of ki-Kongo (13 %);b) in a north-central band running from Luanda to theeast, where cotton was grown for export, peoplesspeaking dialects of ki-Mbundu with increasingadmixtures of Portuguese (22 %);c) in a mixed farming (maize, beans etc) zoneextending from the central coast into the centralhighlands, peoples speaking dialects of umBundu(37 %).As elsewhere in Africa, missionaries transcribed andcodified languages and other cultural markers, thereby‘inventing’ tribal identities. Through their churches,schools, health posts and charitable works, Protestantmissions quietly competed with the dominant Catholicsystem, which colluded with Portuguese colonial order.The churches’ resulting social networks stronglyshaped Angola’s regionalised and ethnically-chargedpolitics. Leaderships of the three main nationalistparties – the FNLA in the Northwest, the MPLA inLuanda and the north-central zone and UNITA in thecentral highlands - emerged from respectively Baptist,Methodist and Congregationalist institutions. 7Apart from these ‘horizontal’ divisions, there wasmarked ‘vertical’ segregation. Foreign-based rentiers,followed by various strata of settlers, formed the top ofthe social pyramid. African hierarchies were dominatedby a longstanding Creole merchant elite. Most membersof that elite were categorised as assimilados (with minorprivileges and subaltern status as colonial citizens)distinguishing them from the indigenas, the caste ofpermanently excluded Africans. There was furtherstratification in rural areas, where the Portuguese hadarbitrarily created ‘advanced’ farmers, local policemen,straw bosses and ‘traditional’ authorities –- althoughtheir popular legitimacy was often in question.7 Birmingham, D. 1992, Frontline Nationalism in Angola andMozambique, London: James CurreyLate in the colonial period, driven by governmenttaxation, forced labour systems, settler land-grabs andthe growth of commercial agriculture, most Angolanshad been absorbed into capitalism’s cash nexus as fullor part-time proletarians and petty producers. Inseveral agrarian zones, African strata of accumulatingsmallholders had emerged, among them some ofAfrica’s most advanced rural producers at the time. Yetfurther advances for Angolans were blocked by denialof education and by further confiscations of land bysettlers and corporations.ConclusionOver hundreds of years, Angola’s foreign overlords hadput in place a political economy based on overt andstructural violence, an ever-changing but lucrativeorder serving chiefly a rentier class in the colonialmetropole and consumers in the USA and WesternEurope. Foreign interests built up a ‘limited accessorder’ that restricted privileges and rents to a narrowelite. 8 The state mirrored social hierarchies based onthe restricted allocation of assets, economic predationand a coercive, militarised approach to public order.Colonial and post-colonial elites showed no interest increating an ‘open access order’ based on citizenship forall and competitive markets. A path was laid downaround a weak but autocratic colonial state dependenton outside powers. Mediocre institutions and underskilledpeople were additional legacies. Angolannationalist movements, their leaders imbued withnorms of a ‘limited access order’, and habituated to theuse of armed force, had no ready alternatives whenthey assumed power.8 The terms ‘limited access order’ and ‘open access order’ arediscussed in North, D.C. and others 2007, Limited Access Orders in theDeveloping World: A New Approach to the Problems of Development,Working Paper 4359, Independent Evaluation Group, Washington DC:The World BankAngola: ‘Failed’ yet ‘Successful’David Sogge

4Globalised Angola –the presentWhat forces entwine Angola in the world economic,social, military and political order? To what incentivesdo Angolan elites mainly respond? How do those elitesassert themselves in regional and global settings?These are among the main questions addressed in thischapter.Oil and geopoliticsIn the short runOil became Angola’s top revenue-earner in 1973, amere five years after its first appearance in exportstatistics and some 18 years after pumping began atthe country’s first commercial well. Oil radically raisedthe political stakes. It led impoverished Portugal tocling more violently to her colonies. It encouraged theUnited States to promote a devastating war againstAngola and at the same time make money from it. Thecombined impact of those conflicts, rising revenues andthe massive political influence of the oil industry inWestern democracies have made oil decisive inAngola’s political economy.Angola’s case illustrates the oil industry’s geo-politicalprivileges. It gets a laissez-passer across even the bestguardedideological boundaries. Until 1974, westernoil firms’ revenues bankrolled the Portuguese wareffort. Yet when the Portuguese departed, those sameoil firms effortlessly switched their allegiance to thetriumphant African leadership in Luanda. The WhiteHouse worked hard to stop the sharing of oil revenueswith the ‘Marxist Leninists’, yet American oilcompanies easily sidestepped those pressures and hadno qualms about cultivating cordial and profitablerelations with the new ‘leftist’ government. Indeed,before the US Congress, a senior American oilcompany executive defended its tax and royaltypayments on grounds that they enabled the Angolangovernment to improve popular living conditions, thevery claim the ‘Marxist Leninists’ made to legitimatetheir struggle. 9Five of the world’s eight largest corporations –Chevron, BP, Exxon/Mobil, Royal Dutch Shell, andTotal - created the hydrocarbon sector in Angola. Theycontinue to expand their stakes there to the presentday. Alongside some smaller ones such as the ItalianENI/AGIP (27 th largest corporation in the world), theywield not only technical but also financial and politicalpower in Angola and in geo-political spheres in whichAngola is embedded.Angola’s case can be understood in light of thecommanding influence the hydrocarbon industry holdsover the political classes in many Westerndemocracies, especially the United States. Thatindustry finances political parties, fields thousands oflobbyists and shapes public debate and opinion throughthe media and think tanks. 10 Also in Western capitals,hydrocarbon-exporting dictatorships and sheikdomsmake their presence felt in spending power and inregiments of public relations operatives. For their part,western politicians pay close attention to the wishes ofthose autocracies, sometimes blocking probes into theircorrupting influence in Western public life. Accordingto a leading former oil executive, Western governmentssubsidise the hydrocarbon industry to the tune of $200billion a year. 11Oil industry power affects geopolitics via nationalgovernments, but also via the scaffolds of globalgovernance. The industry codifies and enforcesinternational financial and legal mechanismsmatching corporate requirements. Among crucialmechanisms are offshore financial centres that shieldoil revenues and personal wealth from taxation.National governments also promote hydrocarbon9 Oliveira, R. S. 2007, Oil and Politics in the Gulf of Guinea, NewYork: Columbia Univ Press, p. 18210 See for example: Oil Change International. http://priceofoil.org11 Former British Petroleum CEO Lord Browne, cited in FionaHarvey ‘Axe fossil-fuel handouts, says Browne’ Financial Times, 2November 2008Working Paper 81

5investments with World Bank loans. They deploynaval, air and ground forces to secure oil shipmentsand to protect oil-producing client states. Westerngovernments have regularly promoted oil intereststhrough covert action or open invasions. In Angola’scase, the United States provided very few of its ownforces, opting instead for a covert war by way ofnational and regional proxies.royalty payments for such resources to developingcountries, particularly in sub-Saharan Africa, havebeen far lower than they should be.’ 15In short, Angola may be as much sinned against assinning. Its treasury, just as treasuries elsewhere,including those of richer countries where oil companiesare headquartered, is not receiving a fair share.In Angola, the political class resides onshore but isanchored financially offshore. Its power depends on itspartnership with oil corporations and the technical,financial, diplomatic and military resources theyprovide directly or effectively guarantee. Yet thepartnership is not one of equal risks and benefits. Forexample, the terms of Production Sharing Contractscushion oil corporations against price fluctuations,thereby exposing Angola to most risks of incomevolatility. 12Companies’ technical and financial control preventsoutsiders, Angolan authorities included, from knowingwith any precision what actual oil output and profitsare. Shielded by national and supra-national rulescrafted through massive lobbying, oil corporations usetransfer pricing and bank secrecy to put their revenuebeyond anyone’s tax jurisdiction. An industry expertnotes: ‘In the Gulf of Guinea, the foreigners pump theoil, and sell it to themselves (often keeping two sets ofbooks, and squirreling away the difference in Swissbank accounts).’ 13 An IMF report estimates that Gulfof Guinea oil exporting governments lose about half thevalue of oil actually exported. 14 A report on tax lossesto mineral exporting poor countries concludes that‘there is plenty of evidence that through a combinationof hard-nosed negotiating tactics and the use ofsophisticated offshore financial products and services,In international domains today, corporationseffectively face only ‘soft law’ - that is, moralpressures to operate transparently; whereas inAngola itself they are legally forbidden to reveal keyinformation. Angola remains outside the ExtractiveIndustries Transparency Initiative, although in 2004it began to release somewhat more information onoil revenues. 16 The largest operators in Angola areamong the industry’s worst performers when itcomes to publishing what their operations actuallyyield in profits or what payments they make to thegovernment. 17 This basic bargain among elites thusrests on a mutually assured denial of information tothe public.For their part, oil corporations require a crediblesovereign state, one that is solid enough to complywith contracts as enforced by international lawyers,judges and mediators and to exercise a monopoly ofcoercive power in zones relevant to the corporations.Thanks to oil revenues, the Angolan state has becomecapable of both. It remains dependent and unevenlydeveloped, but has built alliances with colludingpolitical and corporate actors abroad. As discussedbelow, Angola’s political class has used itspartnerships to acquire its own technical capacities inthe oil sector, as well as capacities in military, financialand media realms.12 Shaxson, N. 2005, ‘New approaches to volatility: dealing withthe “resource curse” in sub-Saharan Africa’, International Affairs, 81:213 Yates, D. 2004, ‘Changing Patterns of Foreign Direct Investmentin the Oil-Economies of the Gulf of Guinea’ in Rudolf Traub-Merz andDouglas Yates (eds) Oil Policy in the Gulf of Guinea, Security &Conflict, Economic Growth, Social Development, Berlin: Friedrich-Ebert-Stiftung14 Katz, M., and others 2004, Lifting the Oil Curse. ImprovingPetroleum Revenue Management in Sub-Saharan Africa, WashingtonDC: IMF15 ActionAid 2008, Hole in the pocket. Why unpaid taxes are themissing link in development finance, London: Action Aid, pp. 17-1816 Ferreira, P.M. 2008, State-Society Relations in Angola: Peace-Building, Democracy and Political Participation, Initiative forPeacebuilding, Madrid: FRIDE, p. 817 Transparency International 2008, Promoting RevenueTransparency. 2008 Report on Revenue Transparency of Oil and GasCompanies, Berlin: Transparency InternationalAngola: ‘Failed’ yet ‘Successful’David Sogge

6In the longer runAngola’s known oil and gas reserves are relativelymodest, being far smaller than those of Nigeria orSaudi Arabia. Its oil output is projected to peak in2010. Between 2015 and 2018, Angola’s petrodollarbasednational budget could flip from surplus to deficitif no alternative sources of state revenue are found.The hydrocarbon sector currently absorbs aroundthree-quarters of all investment but generates only afraction of one percent of all new employment. Bycontrast, the agricultural sector absorbs less than onepercent of recorded new investment 18 but couldgenerate massive new employment.Should Angola persist in its current pattern of elitecentredconsumption and hydrocarbon-centredproduction, it will probably face a serious downturn byaround 2020. 19 The revenue shock triggered in 2008by falling oil and diamond prices (accompanied in alllikelihood by accelerated capital flight) provides aforetaste of what may lie ahead. The next decade couldsee an abrupt end to rising expectations among urbanstrata who aspire to stable middle class lifestyles. Thecurrent development model is thus a ticking politicaltime bomb. The coming decade will reveal whether thatbomb will be defused or not.Other extractive industries andlandDiamonds have linked Angola to world systems sincethe early 1900s, but with impacts rather different fromthose of the oil sector. Many diamond-digging firms areactive, most employing private or irregular armedforces. In principle a state monopoly managed underformal sector rules, alluvial diamond mining alsoinvolves informal trade and labour circuits. As of2000, an estimated 300 to 350 thousand artisanal18 BPI 2007, Estudos Económicos e Financeiros – Angola,Departamento de Estudos Económicos e Financeiros, Outubro, Lisboa:BPI19 Mitchell, J. and P. Stevens 2008, Ending Dependence. HardChoices for Oil-Exporting States, London: Chatham House (the RoyalInstitute of International Affairs)diamond miners or garimpeiros were thought to beactive; yet even after a brutal government-ledcampaign to suppress them, there were in 2007 at leastas many if not more garimpeiros. 20All these elements pose political and fiscal challengesboth to central authority and to internationalmonitoring. Diamond-trafficking paid Unita’s billsduring its last nine years of war. In 1994, an abortivepeace settlement allocated control over five diamondareas to Unita; in 2002 this elite bargain was renewed,this time with success. Separatist movements in themain diamond zones of Lunda North and Lunda Southhave emerged, but have been held in check throughagreements among political and military elites abouteach one’s shares of diamond revenues. Transparencyhas been even weaker than in the hydrocarbon sector,although UN and civil society pressures have broughtformal diamond trading circuits under a permanentpublic spotlight. These get attention because theyinvolve major international players, such as the DeBeers monopoly.Other extractive industries such as iron ore, granite andmarble are far less lucrative, but control over them islikewise subject to limited access in the service ofinternationalised elite bargains. The same logic holdsfor access to land. Upward pressures on global foodprices strengthen incentives for foreign corporationssuch as Lonhro to acquire land suitable for farming orranching, either for direct use or for speculation.Chinese investors are also among those showing activeinterest in Angolan farmlands. A land law enacted in2004 protects small farmers only marginally, 21 insteadfavouring corporate interests. Such trends castshadows on the prospects for decent rural livelihoodsand an equitable distribution of income and wealth; onthe contrary, they set the scene for further socioeconomicpolarisation and conflict.20 PAC 2007, Diamond Industry Annual Review for Angola 2007,Ottawa: Partnership Africa-Canada21 Discussed in ‘A Questão da Terra em Angola. Ontem e Hoje’ F.Pacheco (coord.), Caderno de Estudos Sociais No. 1, 2005, Luanda:Centro de Estudos Sociais e Desenvolvimento; and ARD, Inc. 2007,Strengthening Land Tenure and Property Rights in Angola. Land Lawand Policy: Overview of Legal Framework, Washington DC/BurlingtonVT: USAID/ARDWorking Paper 81

7Integration in trade andinvestmentBy 1985, ten years into the post-colonial period,Angola faced increasing disorder: more war, furtherdeterioration of basic utilities and infrastructure, arural economy in collapse and volatility of oil revenues.By 1986 these had shattered the dreams of Luanda’scentral planners about economic self-reliance,including the substitution of imports with home-madegoods. Once a major exporter of food, Angola by 1990was importing more than half its food needs, as well asmany other basic goods.As illustrated in this chart, foreign direct investmentexploded, with profits and other outflows nowsurpassing inflows in net terms. 22Consumer desires and consumer culture have sincemushroomed, fed by rapidly-growing publicity andmarketing industries in which Brazilian andPortuguese firms dominate. Advertising and consumerimages saturate national print and electronic media,whose content is largely imported from Brazil, the USand Portugal. Wants, needs and aspirations are undercontinual upward pressure as images of Westernlifestyles spread and intensify.Trade in imported goods became a key source of profitfor rich people and of informal employment for therest. Licenses to import provided access to hardcurrency credit; they thus became patronage plums,with military commanders among the first to get thefruit. Informal commerce with Zaire and South Africaflourished. Thousands of Angolans became longdistancetraders, importing consumer goods by airfrom Brazil, Portugal and the Far East.Chinese trade and investment have radically shifted thepace and direction of Angola’s integration. Total tradevolume has grown explosively, reaching US$ 25.3billion in 2008, roughly 14 times what it had been in2000. Angola is now China’s number one tradingpartner in sub-Saharan Africa. 23 Chinese businesspresence is expanding, driven largely by national loansand lines of credit tied to its national firms andlubricated by elite interchange via trade fairs and semi-15,00010,000AngolaInward Foreign Direct Investment1974-2007in millions of US dollars5,000source: UNCTAD 20090-5,00019741979 1984 1989 1994 1999 2004FlowStock22 UNCTAD 2009, FDI Statistics, Interactive Database,http://www.unctad.org/23 In 2008, China’s trade with Brazil, whose GDP is about 25times larger than Angola’s, was only twice as large as its trade withAngola.Angola: ‘Failed’ yet ‘Successful’David Sogge

8official trade promotion agencies such as theInternational Lusophone Markets Business Association(ACIML). Competition among foreign suppliers ofgoods and services is thus sharpening, affordingAngolan government elites yet more negotiating power.Portugal remains, however, Angola’s chief commercialsupplier, as well as a major investor.Financial integrationFew countries are more globalised financially thanAngola. As of 1998, it was one of only seven economieswhose recorded gross external assets and liabilitiesexceeded their recorded gross domestic products. 24Since 2002, thanks to an explosion of loans, credits,capital flight and Angolan investments abroad, itsfinancial integration has only deepened.Angola’s engagement with world capital markets hasoccurred without the mediation or blessing of theBretton Woods institutions; Angola has never taken anIMF loan. However, in the late 1980s the governmentbegan introducing some standard WashingtonConsensus policy formulas, showing particularenthusiasm for measures favouring upwardredistribution. These included a stop to consumer foodsubsidies and the sale of public assets – all importantsignals to domestic and foreign business interests thatthe era of state socialism was at an end.Angolan financial surpluses have for decades excitedthe interest of foreign banks and purveyors of credit –an excitement reciprocated by Angolans seeking to puttheir monies discretely offshore. Collusion betweenforeign and national elites has made Angola a netexporter of capital for decades. From 1985 through to2004 its estimated capital flight totalled 216 percentof recorded GDP, ranking it among the most severecases of financial haemorrhage in sub-SaharanAfrica. 2524 Lane, P. and G. M. Milesi-Ferretti 2001, ‘The External Wealth ofNations: Measures of Foreign Assets and Liabilities for Industrial andDeveloping Nations’, Journal of International Economics, Vol. 55, pp.263-394. The data offered may not have included wealth held secretly.25 Ndikumana, L. and J.K. Boyce, 2008, New Estimates of CapitalFlight from Sub-Saharan African Countries: Linkages with ExternalOutflows take place through a mix of corporate misinvoicing,26 bribes and simple transfers by wealthyindividuals. Quantities of capital flight and uncollectedtax revenues are not known with precision. Thatmassive information deficit is a deliberate outcome ofspecial privileges granted to offshore financial centresby Western governments, in large part thanks to hardlobbying and political contributions by the financialindustry. These legal arrangements have helped makethe economic life and public governance more fragilenot only in Angola, but in many other places includingWestern democracies. 27After 2002 Angola became a hot new destination forthe financial industry, backed by enthusiastic officialsfrom Western capitals. In 2007 the US AssistantSecretary of State for Africa projected Angola as oneof the continent’s three main hubs alongside Nigeriaand South Africa. A Western diplomat told a reporter,‘There’s a general feeling that if we are not a player inAngola in the next five years we will have missed thebest opportunity in Africa.’ 28 Official banks and exportcredit agencies of Brazil, China, France, Germany,Portugal and Spain have scrambled to extend newcredit, while Angola has settled old debts. Privatebanks and insurance companies arrive every year to setup shop.World Bank assessments of Angola’s business climateare not flattering, but pro-market American thinktanks give it relatively good ratings, chiefly for its mildBorrowing and Policy Options, working paper 166, Political EconomyResearch Institute, Amherst: University of Massachusetts.www.peri.umass.edu/236/hash/61e07e4377/publication/301/. Illicitflows from Africa are poorly documented and therefore greatly understated;see Kar, D. and D. Cartwright Smith 2009, Illicit FinancialFlows from Developing Countries: 2002-2006, Washington DC: GlobalFinancial Integrity26 Over-charging on exports to Angola was the main form of tradebasedcapital flight to the USA from 2000 to 2005. Pak, S. 2006,Estimates of Capital Movements from African Countries to the U.S.through Trade Mispricing, Workshop on Tax, Poverty and Finance forDevelopment, University of Essex, 6-7 July 2006, Association forAccountancy and Business Affairs27 See documentation available on the websites of the Tax JusticeNetwork (www.taxjustice.net) and of Global Financial Integrity(www.gfip.org).28 Alec Russell, ‘Investors sign up to Angola’s miracle’ FinancialTimes, 22 August 2007Working Paper 81

9tax regime 29 and deregulated trade. 30 The USgovernment approves of its financial integrationmeasures, such as easy outward transfer of revenues. 31Indeed, more money continues to flow out of Angolathan goes in, as shown, for example, in data on foreigndirect investment in the period 2005-2007. 32 WhereAngola’s money actually goes is not publicly known.But if its revenues follow those of other oil exporters,the chief beneficiaries are American. In a studyentitled Recycling Petrodollars, three economists ofthe US Federal Reserve conclude, ‘Although it isdifficult to determine where the funds are firstinvested, the evidence suggests that the bulk are endingup, directly or indirectly, in the United States.’ 33Pioneered by Persian Gulf oil exporters, SovereignWealth Funds are important new state vehicles formanaging petrodollars. In 2004 Angola created such afund, the Reserve Fund for Oil. However most ofAngola’s recorded offshore assets are managed by thestate holding company Sonangol. That company’s corebusiness is oil, including major shares in oil firms inGabon, Congo and Equatorial Guinea, where it alsofurnishes security advice. But it has diversified widely,including interests in Portuguese energy and bankingfirms. It may soon become owner of some major mediain Portugal. In Guinea-Bissau, one of its jointventures, Angola Bauxite, is investing hundreds ofmillions in mining and port facilities.Financial integration and self-assertion are thus welladvanced.Even in the face of rising Chinesecompetition, these arrangements have furnishedWestern elites with several major desiderata: furtherdiversification of petroleum supplies, increased29 Heritage Foundation 2008, Index of Economic Freedom.Washington DC: The Wall Street Journal and the Heritage Foundation30 Cato Institute 2008, Economic Freedom of the World: 2008Annual Report. Washington DC: Cato Institute31 US Department of State 2008, Investment Climate Statement– Angola (2007),http://www.state.gov/e/eeb/ifd/2007/32 UNCTAD 2008, World Investment Report 2008, New York andGeneva: UNCTAD, p. 29433 Higgins, M., T. Klitgaard, and R. Lerman, 2006, ‘RecyclingPetrodollars’ Current Issues in Economics and Finance, 12: 9, NewYork: Federal Reserve Bank of New Yorkrevenues to Wall Street and Western-held financialcorporations; and a burgeoning market for Westernexports and investment opportunities. Forcollaborating Angolan elites, the rewards have alsobeen considerable. This incentive system is highlygeared to the short run and built on precariousecological and economic premises, but those thingshave not made it any less compelling for participants.Having been integrated for a long time, Angola mightserve to illustrate the beneficial effects that marketfundamentalists claim about globalised finance. Butthose claims look spurious, and Angola’s case is merelyone of many. Greater financial integration does notimprove long-term economic growth of poor countries,as even a recent IMF study - with evidentdisappointment - had to conclude. 34 Tellingly, thatreport’s data were gathered before poor countriesbegan to feel the impact of the global financial crisis.As that crisis deepens, the damaging effects ofuncontrolled financial integration are now becomingclear.Political integrationFinancial and military power, and seasoned politicalexperience, have enabled Angola’s elites to negotiateterms of engagement from positions of growingstrength. As European countries jockey for energysecurity, and for lucrative markets for their goods andservices, their attention to Angola has risen.With Western democraciesThe misuse of Angolan oil revenues to advance theinterests of politicians and parties in Western Europeand the United States is one of the more notoriousexpressions of Angola’s political integration withforeign political systems. Despite high-level efforts tokeep the matter secret, sufficient information leakedout regarding French oil company payoffs to Africanand European politicians to trigger criminal34 IMF Research Department 2007, Reaping the Benefits ofFinancial Globalisation, Washington DC: International Monetary FundAngola: ‘Failed’ yet ‘Successful’David Sogge

10prosecutions in France. Evidence that Angolan oilrevenues also taint US politics has been detected, butthe matter still awaits full investigation. 35 A closeobserver of African oil politics underscores what is atstake in the Anglo-Saxon democracies:‘In the rich English-speaking world the corruption isprobably not in the form of a grand unified Frenchstylestate conspiracy, but a more privatised,decentralised, nebulous rottenness, stemming fromthose grand, generic offshore temptations whichinsidiously poison our democracies through lobbyingand other, more nefarious schemes. The higher the oilprice, the bigger the balloons of cash, and the greaterthe threat to our democracies. Once again, oil acts likeheroin: it feels good, but the final result is catastrophic.This is not just more tedious foreign corruption. This isreally dangerous stuff.’ 36With global and regional institutionsShortly after independence in 1975, Angola became amember in good standing of the United Nations and itsaffiliates. Only much later did it join institutions whereglobal economic rules are made: the IMF in 1989 andthe GATT/WTO in 1994. In the years immediatelyafter independence Angola participated as a torchbearerof third-world nationalism in such bodies as theNon-Aligned Movement; today that interest has largelyevaporated. There is little enthusiasm for progressiveblocs such as Socialist International, despite Angola’shaving received much financial and diplomatic supportfrom Sweden and other pillars of social democracy.The government shows only perfunctory interest informal African institutions such as the African Union,the Southern African Development Community(SADC) and, since 1999, the Economic Community ofCentral African States (ECCAS), a mainlyfrancophone body, often dormant, that facilitatesengagement with donors.35 Global Witness 2002, All The President’s Men: TheDevastating Story of Oil and Banking in Angola’s Privatised War,London: Global Witness, pp. 24-2536 Shaxson, N. 2007, Poisoned Wells. The Dirty Politics ofAfrican Oil, New York: Palgrave Macmillan, p. 101Angola has been more visible in international platformswhere it has a direct stake. Luanda has become theheadquarters of a recently-revived Nigerian initiative,the Gulf of Guinea Commission, with joint economicand security ambitions. However, it shows greatenthusiasm for the oil cartel OPEC, in which it becamea full member in 2007 and president in January 2009.In its regional politics, Angola usually acts unilaterally,sometimes with force of arms. Observers note a will toenjoy hegemony over the region and to become a‘kingmaker’ rivalling South Africa. 37 These ambitionshave not gone unnoticed in Washington DC, wherealarm bells began to ring when Angolan armed forceswent in to rescue allied regimes in the Congos andelsewhere. While some in Washington once saw Angolaas a source of ‘regional destabilisation’, 38 suchanxieties have since given way to benign projections ofAngola as a useful regional policeman.With the aid systemIn contrast to most other sub-Saharan Africancountries, donors and the aid system rarely mediateAngola’s political integration. Business and NGOleaders do not see the aid industry as a majordevelopmental force, and deplore the condescensionand conditionalities of the aid encounter. One veteranAngolan observer rejects the notion that, before it canbe properly aided, the country has to be integrated onterms set by donors. Rather, Angolans wish to berespected, not berated to accept the ‘bible’ of ‘goodgovernance, transparency and accountability’, when thepreconditions for such things are not present. 39Donors have therefore never exercised the kind ofpower they have elsewhere in Africa. Since the end ofthe humanitarian emergency, their influence has fallen37 For example: Prendergast, J. and J. Bowers 2003, Angola’sSecond Chance, Brussels: International Crisis Group38 World Bank 2003, Transitional Support Strategy for theRepublic of Angola, Washington DC: World Bank, p. 739 Pacheco, F. 2006, Diplomacia, Cooperação e Negócios a Ajudaao Desenvolvimento: O Papel dos Agentes Externos em Angola, paperpresented at Conference ‘Diplomacia, Cooperação e Negócios. O Papeldos Actores Externos em Angola e Moçambique’, Instituto de EstudosEstratégicos e Internacionais (IEEI), Lisbon 27 March 2006Working Paper 81

11even further. Staff of the European Commission havenoted that ‘As with other resource rich countries, thescope for influencing the government of Angola ingeneral and on governance issues in particular islimited.’ 40 According to one informant, the donors’‘last stand’ was in 2003, when the government finisheddrafting its Anti-Poverty Strategy paper (Estratégia deCombate à Pobreza). That official statement ofpurpose now appears to be a dead letter. A non-official‘observatory’ set up with a donor subsidy in 2004 tomonitor government anti-poverty work is todaydormant.at best, in part because it lacked strong and consistentbacking from powerful member states, particularly inthe West. 42Military and security integrationAmong fighting forces on the continent, Angola’s armyhas had more experience in combat and in rapidinterventions. Those facts, plus Angola’s enormousspending power, make it an attractive partner forforeign military or security officials and theirrespective arms industries.International agencies hesitate about confronting thegovernment, even when their own institutions are atstake. In 2008 they offered few audible objections tothe closure, at government behest, of the Office of theUN High Commissioner for Human Rights in Luanda.There have been exceptions to this timidity; the UN’sSpecial Rapporteur on the right to adequate housingand the UN Special Representative on human rightsdefenders have published reports critical ofgovernment actions.Only a few international development NGOs can becounted on to express criticism. This was the case in2007, when government bullying of four Angola humanrights NGOs triggered a protest from Europeanorganisations. Foreign powers like the United Statestend to give the Angolan government the benefit of thedoubt; indeed, robust defences of Angolan policy havebeen heard from US diplomats. In general, however, the‘international community’ tends to keep its collectivehead down and its mouth shut.Between international agencies and Angolans there islittle love lost. Surveys of opinion 41 indicate low levelsof public confidence in the United Nations. Its overallpolitical and humanitarian record has been mediocre40 Commission of the European Communities 2007, Towards anEU response to situations of fragility, Commission Staff WorkingDocument SEC(2007) 1417, Brussels: CEC, p. 3041 BBC World Service Trust 2008, Elections Study Angola 2008,London: BBC World Service Trust; Farinha, H., I.S. Emerson and J.Pinto de Andrade 2004, O Futuro Depende De Nós - Angolanosdiscutem o seu futuro político - Perspectivas dos Quimbos às Cidadesde Angola, Washington DC: National Democratic InstituteFor decades, Angolan military, security and businessplayers have been buying arms and military/securityservices in both official and shadow markets. Angolanbelligerents evaded UN sanctions in their purchases ofmassive amounts of arms at premium prices. Towardsthe end of the war, non-governmental and officialresearchers documented the huge scope of Angolanintegration with the global market in military goodsand services. 43Since the war’s end in 2002, the military and securitybranches have invested more in military training,facilities and other software; in means of surveillanceand control over civil unrest; and in the private provisionof security services. There are multiple-use goods andmultiple users. For example, since 2004 Chevron hasused Israeli-made unmanned aerial vehicles (UAVs) forsurveillance of territory, in collaboration with Angola’smilitary. There is evidence of increasing competitionbetween Chinese and American military establishmentsfor opportunities to win Angola’s favours; bothAmerican and Chinese training efforts have increased,and joint Angolan-US military exercises, begun in 1997,have now become routine.Western military and police training and salesprogrammes began in the 1990s. Spain’s Guardia Civilworked with Angolan police forces from 1992 to 1998,42 Lari, A. and Kevlihan, R. 2004, ‘International Human RightsProtection in Situations of Conflict and Post-Conflict. A Case Study ofAngola’, African Security Review 13:443 See for example Human Rights Watch 1999, Angola Unravels.New York: HRW, pp. 92-153Angola: ‘Failed’ yet ‘Successful’David Sogge

12followed by Spanish aid for prison services. The US isincreasingly involved; in 2007, for example, itsupported the regional training (including counternarcotics)of 35 Angolan police officers. The Pentagonbegan its first active programmes in 1997; today, jointUS-Angolan military exercises have become routine.Talk of ‘terrorism’ suggests the influence of Americansecurity discourse among Angolan security elites.Integration – conclusionIn a continent marked by extraverted politicaleconomies, Angola’s is an extreme case. Its mainexport is produced increasingly offshore. Most of whatit consumes is imported from abroad. Financially it isdeeply tied to Western financial markets, and now toChinese banks as well. Political and military leverageat home and abroad depend on strategic cooperationwith foreign suppliers. In short, Angola’s politicaleconomy is deeply enmeshed with external circuits andactors.Under Portuguese rule, its economy was geared toglobal markets thanks chiefly to agrarian exports. Thatoutput stimulated consumption, which fed back intoinvestment and further production onshore. Oil andwar changed all that. They fuelled politics thatdestroyed the agrarian economy and displaced thepopulation to urban areas, which are now thedemographic centre of gravity. These urban enclavesare poorly linked with local production systems;earnings and investment capital depend on marketsdriven by consumption (mainly of hydrocarbons)elsewhere in the world, as well as by casino-likespeculation.Domestic politics therefore have little to do withreciprocal relations between citizens as payers of taxesor producers of goods on the one hand, and a politicalclass in need of those taxes and goods on the other.Crucial sources of political power stem from Angola’sreliance on global systems that supply revenue, goodsand means of coercion - all taking place increasinglyunder US diplomatic and military protection.Integration offshore thus stabilises and shapes a‘limited access order’ onshore, as described in moredetail in the following chapter.Angola’s onshorepolitical economyIn what measure do formal institutions ‘onshore’ inAngola account for state resilience or fragility? Whatpatterns and rules of power operate informally throughor around them? What incentives arise, particularlyamong elites, to maintain or challenge these rules?How might these incentives evolve in the future? Theseare among the main questions addressed in thischapter.Military and security systemsFor generations Angola has been hammered by war, itshistory ‘irrigated by the blood of the victims’. 44Angolan and non-Angolan actors in pursuit of powerand wealth have, before trying anything else, usuallytaken paths of violence and coercion. The effects havebeen cumulative. In response to the ‘rollback’ warlaunched against it, the MPLA threw together, withEast Bloc help, 45 a force that later grew into acompetent, battle-hardened army. Thanks to a US-ledcrusade against it, to a flow of petrodollars and to afree market in military goods and services, Angola istoday a highly militarised and ‘securitised’ place, onecapable of deploying forces affecting politics in otherAfrican countries.Relative to the size of its population, Angola’s military,police and paramilitary forces are the largest in sub-Saharan Africa, with the probable exception ofEritrea.44 Pélissier, R. 1986, História das Campanhas de Angola.Resistência e Revoltas 1845-1941, vol II, Lisboa: ImprensaUniversitaria, Editorial Estampa, p. 28045 Cuba was an important source of military and non-militarytechnical assistance in the period 1976-1990. See ‘Cuban interventionin Angola’, http://en.wikipedia.org/. The Soviet Union, Vietnam and EastGermany also contributed technicians, material and funds. With theexception of military capacities, little today remains of their influence.Working Paper 81

13As of 2005, close to half a million people were on thepayroll of the Angolan Armed Forces, although lessthan a third of them were on active duty. Many tensof thousands 46 more serve in regular and irregularpolice forces, the Presidential Guard and the secretservices.Alongside those public forces, private securitycompanies have grown. As of 2004, nearly twohundredprivate security agencies employed around 36thousand people, mainly in Luanda and in diamondmining zones. These firms have bought and sold in ashadowy public-private market structured more bypolitical relationships (the leading security companieshaving been acquired by senior military officers) thanby open competition.In formal terms, civilian politicians have always hadthe upper hand over the Angolan military and securitybranches. Informally, however, their authority hasdepended on pacts with senior military officials. Suchpacts have been imperative since 1977, when a violentcoup attempt by security branch officials traumatisedthe political class. That imperative grew in the 1980sas Unita and its foreign backers intensified their waragainst the government. Effective, disciplined and loyalarmed forces became a fundamental project in statebuilding.Senior figures have paid close attention to therecruitment, training discipline and compensation ofmilitary and security officials. They have done so witha close eye for the social make-up of the securitybranches, in order to reduce risks of dissension anddisloyalty. After purging a number of white andmestiço officers from the army in the early 1980s, theleadership changed its policy and took an inclusiveapproach, recruiting officers of ethnic groups fromwhich opposition parties and their insurgent armiesdrew their adherents.46 In 2008, a total of 45,544 police staff participated in a trainingprogram of some kind, according to the Interior Minister (ANGOP 12January 2009). Angola’s internal security workforce may therefore benearly twice the sub-Saharan African average of 180 police personnelper 100,000 citizens.After the war’s end in 2002, the security sectorabsorbed some of the 130,000 demobilised excombatants.Incorporation of more than 5000 formerUnita soldiers and generals into the national army andpolice force was an important gesture of reconciliation.Training and upgrading have followed, often withforeign support.The leadership has worked to cement officer corps’allegiance by cultivating personal loyalties based onboth formal benefits such as promotions and pensionsand on informal benefits. In the wave of privatisationsof the 1990s, senior military figures acquired urbanreal estate and former state farms. 47 Their routes toaccumulation included access to discounted dollarsand to commercial brokerage positions, especiallyquasi-monopolies over flows of certain imports orexports - lucrative privileges obtained throughpatronage. Backed by substantial spending (some of itoff-budget), clientalist systems keep commandstructures unified and loyal. 48 Sub-streams ofpatronage branching downward help cement politicalallegiance in other levels of society. With the importantexception of Cabinda, a modest majority of Angolansclaim to trust the armed forces. 49Otherwise, overt police coercion has been directedchiefly toward those lacking all political protection:migrant workers in diamond zones, low-incomeresidents living on prime urban real estate andepisodic protestors such as students. Theseincreasingly face ‘hybrid’ policing - joint operations offormal police with private security services - a‘privatised’ approach in which information is legallyunobtainable, complaint procedures become dead endsand no officials can be held to account. Meanwhile, thedeployment of secret police and the use of informantsseem to be growing, penetrating even local NGOnetworks.47 Péclard, D. 2008, ‘Introduction au Thème. Les Chemins de la“Reconversion Authoritaire” en Angola’, Politique Africaine 110, p. 1548 Elite bargains built on privatisation can be fragile. In Serbia,Georgia and Azerbaijan, the award of privatised assets to favouredclients did not guarantee their political loyalties. See: Gould, J. A. andC. Sickner 2008, ‘Making market democracies? The contingent loyaltiesof post-privatisation elites in Azerbaijan, Georgia and Serbia’, Review ofInternational Political Economy. 15(5):740-76949 BBC World Service Trust 2008, Elections Study Angola 2008,London: BBC World Service TrustAngola: ‘Failed’ yet ‘Successful’David Sogge

14Risks to public security in Angola are, at first glance,serious. In successive waves of demobilisation since1992, many tens of thousands of ex-soldiers have beendumped into labour markets, where very few havefound decent jobs. Moreover, Angola is awash withprivate firearms: 21 per 100 civilians, one of thehighest ratios in the non-Western world. 50 Violentcrime is certainly present, yet its incidence is well belowwhat might be expected given the unfavourableequation of firearms-plus-jobless youth. A 2007 surveyof Angolan businesses showed much lower incidenceand effects of theft and other crimes than elsewhere inAfrica. 51 In contrast to the slums of Cape Town andsome Latin American cities, there are no criminalgangs with monopolies of violence in certain zones.Politics onshorePutting formal institutions at the serviceof informal powerExecutive’s powers to appoint or dismiss all officials ofthe judicial branch, from the Supreme Court to theAudit Court (Tribunal de Contas). But it also operatesinformally, such as by stacking key bodies like theNational Electoral Commission with ruling partyadherents.Effective powers of the Parliament (AssembleiaNacional) are highly circumscribed by its narrowmandates, minimal resources and lack of financialautonomy. 53 Although dissent may be voiced andlegislation initiated there, Parliament has servedmainly as a platform for the ruling party, a functionthat in formal terms is today absolute. The country’sfirst elections in 1992 gave the MPLA 59 percent ofall seats; those of 2008 gave it 87 percent. For allpractical purposes, the status quo of the pre-1992 onepartysystem has thus been restored. Political debateand checks-and-balances thus take place largely withinthe precincts of the party/governmental leadership,behind closed doors.According to its Constitution, Angola is aparliamentary democracy. It operates throughexecutive, legislative and judicial branches whoseseparate powers allow for checks and balances amongall three. In formal terms, the public can make its voiceheard through multiple parties, civil societyorganisations and public media. However, this formalframework is only loosely related to the ways politicsactually work. Informal rules and relationshipsprevail, usually behind the legitimating façade offormal arrangements.The reality is that Angolan politics pivot on thePresident’s office, ‘Futungo’. 52 It manages clientalistsystems through a state apparatus welded together atmany points with the dominant party, the MPLA. Thismonopoly is expressed formally, such as in the50 Small Arms Survey 2007, Geneva, (online)www.smallarmssurvey.org51 World Bank 2007 Angola Investment Climate Assessment,Washington DC: World Bank, p. 3552 Referring to Futungo de Belas, the Presidential complex on aseaside hill of Luanda from which the President and other seniorpersonages operate.A formal legal system has never been accessible toordinary Angolans. Today the judicial branch remainsweak and subordinated to central authorities. Itsdeficits in staff and operating systems are graduallybeing addressed. Courts enjoy a certain amount ofpublic confidence. 54 But there are few precedents ofcitizens bringing suit against the authorities. 55Meanwhile government is promoting less formal andbinding approaches to dispute settlement. In 2008, itsthird year of operations, the Judicial Ombudsman’soffice (Provedoria de Justiça) registered 400 citizencomplaints. In the same year a senior official proposedthe creation of public and private Mediation Centres(Centros de Arbitragem). However, such bodies haveno mandates to enforce laws or impose legally bindingoutcomes. Instead they serve to alert the authorities to53 Isaksen, J. and others 2007, Budget, State and People. BudgetProcess, Civil Society and Transparency in Angola, Working Paper2007:7, Bergen: Chr. Michelsen Institute; Amundsen, I. and others2005, Accountability on the Move. The Parliament of Angola. WorkingPaper 2005:11, Bergen: Chr. Michelsen Institute54 BBC World Service Trust 2008, Elections Study Angola 2008,London: BBC World Service Trust55 Skaar, E. and J. Van-Dúnem 2006, Courts under Construction inAngola: What can they do for the Poor? Working Paper 2006:20,Bergen: Chr. Michelsen InstituteWorking Paper 81

15problems without requiring them to find solutions.Other semi-formal initiatives, such as provincial humanrights committees, are largely dormant.Through its command of the airwaves and powers tointimidate or buy off critics, the regime controls andcolours the information available to most of the public.Self-censorship is rampant. Comparative indexescompiled by Reporters Without Borders and FreedomHouse commonly rank Angola’s press freedoms amongthe more restricted in Africa, though not among the mostrestricted. A recent analysis by a veteran media andhuman rights activist paints a somber picture ofindependent media becoming further confined, drained ofstaff and eclipsed by state and private media which churnout pro-regime images and frivolous entertainments. 56The public at large, and probably some in the politicalclass, are kept in the dark about essential political andeconomic matters. Transparency about official budgets isamong the most restricted in the world. 57 In these ways,informed, open politics face major barriers.Sub-national politicsTerritorial government has never been strong; fortyyears of war weakened it further, even to the point ofextinction in some zones. Humiliated for years by thepresence of a Unita-led ‘republic’ in the interior andsensitive to political rumblings in Cabinda and theLundas, central authorities are hyper-alert to incipientseparatism. They have shown political sophistication inkeeping provincial elites ‘inside the tent’, in a broadinformal coalition. Central authorities steer andfinance sub-national governance in layers down to locallevels. They appoint all senior sub-national officials,and create or dissolve institutions (branches ofparastatal companies, funds, commissions,programmes, etc.) according to their wishes. While afew may consult residents at local levels, every subnationalgovernment is accountable only upward,ultimately to the top authorities in Luanda.56 Marques, R. 2009, ‘Mass media in Angola: Hegemonic poweror power to be subverted?’ Pambazuka News, 8 January,http://www.pambazuka.org/57 Open Budget Initiative 2008, Open Budget Index 2008,http://www.openbudgetindex.orgAuthority is centralised, but provincial deputies haveoccasionally been granted discretionary powers. Innegotiations with Unita, the MPLA expressedwillingness to allow the President’s choice of provincialgovernors to be influenced by electoral outcomes.Futungo has from time to time suspended provincialleaders known to be corrupt and unpopular, but alsothose known to be effective and popular (e.g. formerPrime Minister Lopo de Nascimento as ‘super’authority over three southwestern provinces in the1980s).Nevertheless, Luanda is now confident enough to tryre-organising the power pyramid again. Since 2005,with Brazilian conceptual and technical advice, a pilotproject for ‘decentralisation’ has been underway in 88key districts, home to about 70 percent of thepopulation. In 2009, all of Angola’s 167 districts areto receive US$ 5 million each to be spent according toa locally-formulated District Master Plan approved inLuanda. A Decree-Law of 2007 mandates publicconsultation on local development plans and relatedissues, thus opening modest official spaces for citizens’voices to be heard at local levels.However, forums for politics made by citizensthemselves are unwelcome. It is far from clear thatpromised electoral competition at local levels willchange that. The MPLA in any case has begunpreparing the ground in some detail; for example, tomeet gender balances mandated in law, wives of MPLAofficials are being groomed (training courses in Brazil,etc.) for elected office. The authorities emphasisegradualism in these kinds of political innovations, justas they leave no doubt that significant powers willremain in their hands.Much more importance is attached to stateadministration than to political life. The territorialreach of state agencies remains weak, but performanceof some key tasks is growing stronger. 58 The collectionof taxes, customs revenues and electricity payments is58 Going by LSE Crisis States research programme indicators.See Putzel, J. 2008, Development as State-Making Research Plans(revised), Crisis States Research Centre, manuscriptAngola: ‘Failed’ yet ‘Successful’David Sogge

16improving, from a low base. The regime’s capacities toget its messages across via radio, and limit alternativemessages, are strong, certainly contributing to theMPLA’s landslide victory in the September 2008parliamentary elections. Other public sector tasks haveseen uneven advances: road surfaces and watersystems have been improved, especially in the urbanzones of salaried strata. Indicators of formal schooling- number of students, teachers and classrooms - had by2008 more than doubled over 2002 levels. Healthsystems have also expanded, but results have beenmixed. Tuberculosis rates are rising and in 2007cholera hit tens of thousands in Luanda alone.Expanded reproduction of autocratic ruleFor Futungo, what is mainly at stake is its monopoly ofpower. Indispensable to this purpose are its offshorearrangements, chiefly with oil companies and their(mainly American) political and military protectors.Onshore, Futungo’s chief concern is to block theemergence of any serious domestic challenge to itsrule, whether a separatist movement or a majorcoalition of economic or political interests able tosustain itself independently of central authorities.During the war years, the MPLA leadership ultimatelyoverpowered domestic rivals with both militarycoercion and material persuasion. It gained allegianceof former rivals by furnishing access to perks, propertyand privileged means of extracting rents and access toforeign exchange. These measures neutralised moreand more opponents, convincing most to allythemselves to the MPLA government in an everbroaderelite coalition. Those showing too much ingrouployalty or reliance on foreign economic circuitsindependently of Futungo would find themselvessuddenly denied official favours and frozen out. In themid-1990s this was the fate of a then substantialcluster of prosperous Lebanese merchants, most ofwhom subsequently left the country. Aspiring newbusiness, professional or bureaucratic groups thus facestrong incentives to ally themselves vertically ratherthan laterally, and to frustrate or quash rivals and theirproposals.The state enterprise Sonangol has been a crucialinstrument in the leadership’s hands. Created in 1976as the national oil company, it is today a big andsuccessful holding company. Together with Angola’sarmed forces, it is a competent and robust institutionin a wider context of institutional decay and fragility.A close student of oil and politics in the Gulf of Guineadescribes Sonangol as ‘the centrepiece in themanagement of Angola's “successful failed state”.’ 59With its deep pockets and solid backing from powerfulmilitary and financial forces abroad, Futungo’s handsare free – human and organisational capacitiespermitting – to pursue its clientalist political project onits own terms. However Angola’s extraverted economyand the post-war surge in foreign investment big andsmall are creating new opportunities for accumulationbeyond the purview of the ruling party. These rangefrom formal sector business licenses and credit lines toinformal sector trading, labour and transport circuits.With external business partnerships multiplying, someobservers thus see Futungo’s control overaccumulation onshore as not absolute but relative. 60Nevertheless, although deals between big Angolanentrepreneurs and foreign businesses occur regularly,central authorities work hard to maintain tight,vertical control over access to main streams of revenueand the assets that underlie them. Hence they actroutinely to frustrate horizontal alliances or majorenterprises (formal or informal) that might allow fundsand political resources to accumulate beyond theircontrol.Flows via the foreign aid system have created tensions.During the war years, the government had ceded todonors and humanitarian NGOs some control overresources and access to populations. Today the accentis firmly on state control, whether by diplomacy, cooptation,bullying or imitation. Non-state actors andprojects receiving foreign aid are kept on a particularlyshort leash. The MPLA and Futungo have advanced59 Oliveira, R. S. 2007, ‘Business success, Angola-style:postcolonial politics and the rise and rise of Sonangol’ J. of ModernAfrican Studies, 45:4, p. 59660 Vallée, O. 2008, ‘Du Palais aux Banques: La ReproductionÉlargie du Capital Indigène’ Politique Africaine 110, p. 26Working Paper 81

17the ‘colonisation’ of the civil domain by creatingfoundations and NGOs answerable to them. Access tobenefit streams is also managed through suchpatronage devices as the ‘Specialty Committees’(Comités do Partido de Especialidade) created in2004 as a means of drawing professionals, journalists,technicians and other ‘intellectuals’ into the Party’sorbit. 61A test of Angola’s elite bargains will be that ofpresidential succession. As of 2009 there is no evident‘crown prince’. The choice of successor to President dosSantos will fall to a ‘selectorate’ of senior political andmilitary figures. 62 Toadying, back-stabbing and fallsfrom-gracehave long been part of Futungo courtpolitics, but current elite pacts appear to be broadlyrobust. With no one faction seriously at risk, a smoothsuccession process seems entirely feasible.Economic growth, politicalsociology and state resilienceEconomic growth onshore has accelerated since 2002.It has reproduced some of the polarised andoutwardly-oriented patterns of Angola’s colonial past.Guiding it are rules, plans and public subsidiesreflecting preferences of political elites and foreigninvestors. The leadership talks frequently of‘sustainable development’ but makes its choicesmainly according to ‘high modernist’ developmentmodels of dubious sustainability seen in other rentiersettings such as the Persian Gulf. There has been asurge in the creation of consumer needs, and, forsome, the satisfaction of those needs. Beyond thestate/party nomenklatura, the lucky few includemembers of business, professional and otheradvantaged strata whose spending power, thanks to61 That patronage system probably contributed to the failure of apolitical party composed of intellectuals and activists, the FdP, to gaina seat in Parliament in the September 2008 elections.62 Studies of succession in autocratic regimes suggest that wherea selectorate is not politically dependent on the person in the topposition, it can usually nominate his or her successor without losingpower. Besley, T. and M. Kudamatsu 2007, Making Autocracy Work,Development Economics Discussion Paper 48, London: London Schoolof Economicshigher salaries and access to consumer credit, hasincreased.Despite the prosperity of salaried strata, the state’ssocio-economic base remains narrow and possiblyunstable. The post-1975 enclave economy is anartifact of war and petrodollars. The collapse of theagrarian commercial economy put Angola at the mercyof world prices of oil, food and credit. State incomeand expenditure have generally followed the ups anddowns of oil prices. At present, taxes on wages,consumption and non-oil business activity account foronly a small part of state revenues. Hence onshoreconsumption and production are hardly a basis forreciprocal politics binding the political class tocitizens.Oil dependence is commonly thought to make statesunstable. The causal chain is roughly as follows: oildependence -> breakdown of citizen-state reciprocity ->political fragility -> war. But the Angolan case offers noclear confirmation of this hypothesis; on the contrary itis consistent with statistical studies indicating that oilwealth tends to prolong and stabilise autocraticregimes. 63 Most rentier regimes ‘have generally avoidedthe substitution of oil for statecraft.’ 64An important part of statecraft is the redistribution ofrents to better-off consumers and formal sectorbusinesses. This takes place unobtrusively by way oflow charges, and in some cases non-collection ofcharges, for state-supplied housing, fuels, electricity,water and air transport. Such de facto subsidies,63 Ross, M. 2008, But seriously: does oil really hinder democracy?typescript, UCLA Department of Political Science, Draft October 29,2008. Comparative statistical research tracking ‘resource cursed’regimes over time suggests that oil and mineral dependence does notcause autocracy or preclude transitions to democracy. See Haber, S.and V. Menaldo 2008, Do Natural Resources Fuel Authoritarianism? AReappraisal of the Resource Curse. A striking feature of these multipleregression studies and debates, however, is their lack of attention to geopoliticsand the role of super-powers in protecting or removingautocratic regimes.64 Di John, J. 2008, Conceptualising the Causes and Consequencesof Failed States: A Critical Review of the Literature, Crisis StatesResearch Centre, working paper nr. 25, London: LSE, citing Smith, B.2004, ‘Oil wealth and regime survival in the developing world, 1960-1999’, American Journal of Political Science, 48:2. A more plausiblecausal sequence would be: predatory Western oil interest -> war -> oildependence.Angola: ‘Failed’ yet ‘Successful’David Sogge

18reinforced by benefit schemes for elites (foreignscholarships, medical treatment abroad, etc.) andchoices of investment (shopping malls, multi-lanehighways for Luanda, etc.) underpin their verticalallegiances. Some de facto subsidies, such as for fuel,also reach low-income urban dwellers, and thus mayblunt some hard edges of inequality in cities.Crucially, the leadership’s patronage systems haveincluded elites in peripheral zones. Here, ‘horizontalinequalities’, ethnic loyalties and grievances against‘Luanda’ can form a potent mix, as noted earlier aboutCabinda and the Lunda Provinces. The social ‘reach’ ofpatronage beyond elites is, however, not unlimited andmay risk falling short of rising expectations of the poormajority. Earlier surveys of public opinion suggest thatonly a minority of people see their lives getting better.Assuming Angolans see things as do citizens elsewherein Africa, they probably sense that poverty as theyexperience it has worsened. 65In mobilising public revenues, onshore production andexchange matter little in formal terms; indeed, manyeconomic circuits operate beyond the reach of theauthorities. As in most of sub-Saharan Africa, theunregistered ‘informal’ economy accounts for most ofthe labour force and a sizable share of spending, savingand investment. 66 Conventionally seen as made up ofself-reliant entrepreneurs, Angola’s informal economyis in fact composed of owners, owner-operators andthose earning wages or commissions. Only a minority ofparticipants in the informal economy are single, selfemployedentrepreneurs.Angola’s formal and informal economies do not exist inseparate compartments; they are better seen as twodimensions of one interconnected whole. Mostunregistered economic circuits are subordinated to theformal economy. Participants in the informal economy65 Mattes, R. 2008, The Material and Political Bases of LivedPoverty in Africa: Insights from the Afrobarometer, Working Paper No.98. http://www.afrobarometer.org/Papers/Afropaperno98.pdf66 Turnover in Angola’s onshore ‘shadow’ economy of 2003 wasestimated to be equivalent to 45 percent of its recorded GDP.Schneider, F. 2007, ‘Shadow Economies and Corruption All Over theWorld: New Estimates for 145 Countries’ Economics: The Open-Access, Open-Assessment E-Journal, Vol. 1, 2007-9are not so much excluded from the formal economy asadversely incorporated into it. Close study of goodsmarkets in cities reveals complex hierarchies ofinformal businesses and workers dependent on formalbusinesses and agents of the state. 67 Also in the formaleconomy, entrepreneurs setting up registeredbusinesses come from, or depend on contacts with, theruling party or its government agents. 68Official positions toward the informal economy tend tovary according to the social power of those in question.Poor petty traders, the majority of whom are female,have always faced bullying and shakedowns by thepolice, particularly the ‘economic police’ (PoliciaFiscal). By contrast, economic agents further up supplychains can expect deference and cooperation. Some ofthese are owners of formal businesses whose sales andlabour depend on unregistered workers, brokers andother agents. Illicit flows managed by elites, such as viainvoice mis-pricing or use of tax havens, evidentlyescape formal regulation.In official utterances, the authorities are bent onsuppressing the informal economy, particularly itsexpression in sprawling urban marketplaces. Yet for thetime being the informal economy’s existence is not atrisk. There are too many elite interests at stake in itscontinuation. Its commercial domains are vital tosystems that move imported goods from wholesalelevels controlled by holders of franchises grantedthrough political patronage to consumers. It serves asa social buffer or sponge to absorb the majority ofwork-seekers and to curb organised, militant activismarising from workers, whether formal or informal.Can there emerge a social bloc capable of operatingoutside the political class’s patrimonial systems? The67 Ducados, H. 2000, Género, Raça e Classe - A Feminização daPobreza: A Estratificação do Sector Informal Urbano de Luanda,presented at Simposio ‘O Desafio da diferença’, Universideade Federalde Bahia, Brasil 9-12 April 2000; Pereira, A. 2008, ‘Género, Mercadode Trabalho e Sociedade Civil’ in N. Vidal and J.P. de Andrade,Sociedade Civil e Política em Angola, Coimbra: Centro de EstudosSociais, Universidade de Coimbra68 Grassi, M. 2000, Género e desenvolvimento em Angola:mulheres empresárias em Luanda e Benguela, presented at Simposio ‘ODesafio da diferença’, Universideade Federal de Bahia, Brasil 9-12April 2000Working Paper 81

19question is disputed. In the early 1990s, some signs hademerged of autonomous economic actors who had‘taken advantage of vague definitions and smallopenings in the law.’ 69 While some transporters andfarmers have indeed prospered, a critical mass ofentrepreneurs beyond state/party patronage systemshas yet to appear. The veteran Angolan banker MarioPizzaro concludes:‘Angola’s business fabric is fragile and dependent. Thisfragility and dependence blocks the existence of acritical mass capable of discussing and influencinggovernment decisions. A large part of Angolanbusiness people emanate from the ruling power bloc orare directly or indirectly linked to that power.’ 70The regime discourages business strata from operatingindependently of its clientalist systems. At the sametime it has presided over the emergence of a ‘“newclass” created in the shadow of dirigisme andétatisme.’ 71 Helping advance its fortunes are formalinstitutions such as banks. In 2007 the government setup its own development bank, the Banco deDesenvolvimento de Angola (BDA), whose first year ofoperations saw more than half the total value of itsloans going to Cabinda province, thus underlining itspolitical purposes. 72 In 2008 the government acquiredcontrolling interests in two Portuguese banks.On the face of it, such measures may answer prayers bynational business people who, in a recent survey ofAngola’s investment climate, identify lack of access tocredit as the most serious problem they face. 73 In 2009the government launched a modest credit programme69 Pestana, N. 2008, O poder e a diferenciação social em Angola,Luanda: FdP; citing Filomeno Lopes. See: http://www.fpd-angola.com/70 Pizzaro, M. 2006, Diplomacia, Cooperação e Negócios: OPapel dos Actores Externos em Angola, Tendências do Comércio e doInvestimento, Powerpoint presentation for the conference ‘Diplomacia,Cooperação e Negócios. O Papel dos Actores Externos em Angola eMoçambique’, Instituto de Estudos Estratégicos e Internacionais(IEEI), Lisbon 27 March 2006 [translation D.S.]71 Pestana, N. 2008, O poder e a diferenciação social em Angola,Luanda: FdP72 In Mozambique, donors effectively vetoed a governmentproposal to set up a similar bank.73 World Bank 2007 Angola Investment Climate Assessment,Washington DC: World Bankfor small commercial farmers, but there are few othersigns of official interest in promoting small or mediumenterprises. The political class may oppose independentbanks not only because they would promote socialblocs beyond their control.Formal rules and informal ‘encouragement’ by stateauthorities limit the likelihood that substantialautonomous business strata could emerge. ThePromotion of Angolan Private Entrepreneurs Law of2003 adds formal suasion to informal mechanismscoupling business interests with state patronage. Thestate has taken steps to dominate wholesalecommerce, promoting a parastatal supermarket chainbuilt up with Brazilian corporate expertise. Elsewherein Africa, this sector is lucrative and has given rise tolarge autonomous business dynasties; perhaps for thatreason in Angola the sector is being cornered in orderto reinforce state/party power, not compete with it.The government puts foreign business under particularpressure to engage Angolan nationals as employees, assources of goods and services and especially as‘partners’ in enterprises and projects. 74 In identifyingwho gets access to these tasks and ‘partnerships’,official patronage systems are always at hand. Somepressures on foreign investors come from their ownranks. For example, compliance with Angolan formaland informal regulations imposes costs on privatebusinesses, creating incentives for all firms tocollaborate on the same terms. 75 In the bargain,patronage systems are further reinforced.Onshore effects of foreign corporations on stateresilience have yet to be studied systematically, butsome anecdotal and case material suggests some of thepaths of influence. Angolan elites welcomecorporations for the formal and informal benefits of74 A vigorous, even aggressive nationalism is detectable amongmany in the political class. It expresses itself toward foreign interests,thereby, according to one observer, compensating for the narrowpolitical space inside the country. Vallée, O. 2008, ‘Du Palais auxBanques: La Reproduction Élargie du Capital Indigène’ PolitiqueAfricaine 110, p. 2675 Vines, A., N. Shaxson and L. Rimli 2005, Angola. Drivers ofchange: an overview. London: Chatham House, p. 9Angola: ‘Failed’ yet ‘Successful’David Sogge

20‘partnerships’. But strong resentments can arise abouttheir arbitrary powers over hiring, local spending andimpacts on the environment and local economies,which in oil extraction zones have suffered severedamage. 76 According to a 2008 survey of publicopinion, Angolans have less confidence in majorcorporations than any other major institution, even lessthan in political parties. 77Both the state and its corporate partners worry abouteach others’ public profiles as well as their own.Displays of corporate philanthropy led the governmentto levy a special tax on large corporations called the‘social bonus’. Until around 2002 these payments wentto Sonangol, thereafter to the central treasury. Thereare no full public accounts of either sources or ultimateuses of these funds; ‘leakage’ to clientalist networkscannot be ruled out.Oil companies like Chevron and Exxon seek to show‘social responsibility’ through charitable good works inzones where they operate. Increasingly, however, theyare subsidising national programmes of the UnitedNations, international NGOs and bilateral agencies likeUSAID. Through such patrimonial largesse, foreigncorporations exert influence over agencies mandated tohelp eliminate corrupt, unequal influence in Angolangovernance. Informants to this study with experienceof oil company philanthropy in Angola see little valuein its approaches or effects. Their negative views areconsistent with findings elsewhere in the Gulf of Guineathat cast serious doubt on stories of positive outcomesof oil industry ‘social responsibility’. 78Like agencies in the official aid system, corporatedonors have favoured projects in health care,education, training and infrastructure such as roads -purposes that normally would fall to the public sector.Corporate philanthropies followed the official and nongovernmentalaid agencies in usually failing to engagewith the public sector in constructive ways. 79 Thechurch and its institutions, and other private serviceproviders, were major beneficiaries of the aid system.Towards the end of the war years, it had become clearthat aid agencies had ‘played a critical role in theprivatisation of the Angolan state and its de-linkagefrom society.’ 80Today, despite interesting projects to reinforce publicsector capacities, donors (including oil corporations) 81continue to by-pass and substitute for the public sector.Such initiatives easily win government approval, as nomajor state outlays are required yet officials willusually get a share of the credit. In the longer term,however, such foreign aid approaches can underminestate resilience. This is especially so where, as inAngola, they are combined with rising privatisation andthe commercialisation of health, education and otherservices. The resulting stratification of services furtherdissolves any social contract and can contribute tosocial exclusion and the further hollowing-out of publicsector legitimacy.ConclusionAfter nearly four decades of upheaval, Angola hasstabilised. War and rising oil wealth have reconfiguredthe country’s political economy and demography.Offshore flows eclipse onshore economic circuits andreinforce a central autocracy whose politics follow alogic of clientalism legitimised by the rules andprocedures of formal democracy. Despite thepacification of politics and the undeniable gains incollective self-esteem, there are signs of continuity,indeed of ‘path dependence’. Decades after abandoningSoviet-style central planning, and embracing a76 Reed, K. 2007, ‘Acordar de um Pesadelo: A vida na ZonaPetrolífera no Soyo’ in N. Vidal and J.P. de Andrade, Sociedade Civil ePolítica em Angola, Coimbra: Centro de Estudos Sociais, Universidadede Coimbra77 BBC World Service Trust 2008, Elections Study Angola 2008,London: BBC World Service Trust78 Frynas, J. G. 2005, ‘The false developmental promise ofCorporate Social Responsibility: evidence from multinational oilcompanies’, International Affairs 81:3, 581-59879 Robson, P. 2003, The Case of Angola. Active Learning Networkfor Accountability and Performance in Humanitarian Action, London:ODI80 Ostheimer, A., 2000, ‘Aid agencies: providers of essentialresources?’ in Angola’s war economy – the role of oil and diamonds, JCilliers & C. Dietrich (eds) Pretoria: Inst. for Security Studies, p. 13481 Tallio, V. 2009, ‘Drawing the borders of the common good? Theinvolvement of the oil companies in the public health sector in Angola’,presented at World Conference of Humanitarian Studies, Groningen, TheNetherlandsWorking Paper 81

21supervised but predatory kind of capitalism, the postcolonialregime today replicates the dirigisme andexternal orientation of the colonial era.In terms of coercive power over national territory,Angola’s state is now more resilient than fragile. Thepolitical game may be played in part by nontransparent,arbitrary and personalised rules, but thereis at present no alternative version of them. The state’smonopoly of coercive power is today virtuallycomplete, having marginalised putative separatistmovements both militarily and politically. Its publicprivatepolice system operates effectively, if sometimesbrutally. Leadership of the security forces has been,with only minor exceptions, loyal and unified. Given theabsence of serious security threats, the massive size ofthe military/security apparatus can be explained inpart by its politically stabilising powers to provide jobsand income and to discourage dissent.In terms of control over economic life, the state showsresilience in a number of key respects, althoughabundant petrodollars may mask structuralweaknesses. Its agents effectively supervise theallocation of property and sources of rents, capitalinflows and outflows, money supply and inflation, etc.For a variety of economic, political and militarypurposes, the leadership has built up a large, competentstate holding company with a number of ‘shadow state’functions.Over the informal economy, state powers andmotivations are mixed. Officially the state seeks tocurb and strictly control it in urban areas. Butinformally the stance is often one of laissez-faire, assome of the elite’s rent- and profit-making activitiesdepend on informal circuits and the cheap reproductionof a docile labour force surviving in the informaleconomy. Predatory systems are thus at work in labourmarkets, but potentially more destabilising is thepredatory acquisition of assets, chiefly land, on behalfof local and foreign private interests.unassailable. The MPLA’s triumph in theparliamentary elections of 2008 was too massive to beattributed only to manipulation of the system and ofignorant and dissenting voters, though those thingscertainly played a part. For memories of war are stillfresh; some people feared a return of instability likethat following the last elections in 1992. ManyAngolans may also simply prefer a ‘“delegativedemocracy” where an acquiescent public acceptswhatever the regime chooses to supply.’ 82 All thesefactors probably helped tip votes toward the rulingparty, for want of any credible alternative.Will state resilience be consolidated? The currentpetrodollar-based development model is not that of a‘developmental state’, being too narrowly geared tosatisfying the lifestyle preferences of elites and a fewother non-poor strata. The ‘elite bargain’ underpinningit could be threatened by conjunctural factors, such asthe further collapse of oil revenues or severe losses inoffshore speculative investments.But in the longer term it faces structural challenges.New enterprise-based elites only tenuously subservientto regime patronage are likely to emerge. The regimemay find it hard to block that development. Thepolitical challenge is how to accommodate and absorbthose actors – a political art in which the regime hasshown great proficiency in the past. Less likely but notimpossible, wage- and salary-earners frustrated in theirambitions to better their consumption, includingconsumption of public services, could find politicalvehicles in civil society or even a faction in the rulingparty. For these kinds of reasons the steering of‘development’ entails far more political and socialengineering than technical modernisation.Capping the appearance of state resilience is theregime’s political legitimacy. As of 2009 that looks82 Mattes, R. 2007, Democracy Without People: PoliticalInstitutions and Citizenship in the New South Africa, Working PaperNo. 82, Afrobarometer, p. 15Angola: ‘Failed’ yet ‘Successful’David Sogge

22Ways forwardglobal systems, and secondly be telescopic enough tosee beyond the next few years to include the (not-toodistant)era when oil revenues begin to taper off.The foregoing pages have looked at state fragility andresilience in Angola in light of the country’s deepintegration with global systems. External players setthe stage for and helped fuel four decades of war andeconomic upheaval. Yet it was internal ones, includinga stronger army and consolidated political control, thatfinally brought that terrible period to an end. Angola’sstate and governance are thus a complex amalgam ofthe weak and the strong, the domestic and the foreign.Today Angola’s politics remain entwined with powerfuloutside actors and are still politics of limited access toassets and privileges. State/party elites pursue theirinterests on the basis of understandings with foreignextractive and banking corporations, and with foreigngovernments, not least for assurances of militaryprotection. Angolan elites harbour social andeconomic ambitions, but those do not now include adevelopmental state pursing a socially inclusiveagenda.Against such a background, and the relative strengthand autonomy of key branches of the Angolan state,what options are open to Western and internationalpolicy makers?Coherence in Western policy andglobal governanceAdopting a coherent perspective is one place to begin.This paper has presented reasons to see the mainissues in Angola as not confined to its territory butdeeply entwined with interests and systems at supranationallevels. It has also noted reasons to seeAngola’s current economic boom as something that,as in earlier episodes in the country’s economichistory, will go bust.A wider viewA wider perspective would be more coherent to theextent that it includes the array of foreign anddomestic incentives facing Angolan elites as well asnon-Angolan actors collaborating with them. Such aview would offer a more realistic understanding ofpower and of who really counts in the ‘internationalcommunity’. As a student of oil and politics in the Gulfof Guinea puts it: ‘The oil company executives, bankers,accountants and lawyers who haunt the lobbies of thefive-star hotels in the region are as constitutive oftoday’s Gulf of Guinea as local actors. Resources thatare criminally siphoned off by incumbents materialisein the West’s sensible investment portfolios and taxhavens.’ 83That perspective would pull into focus the structure ofincentives facing Angolan elites that stem frominternational circuits of money, goods and means ofrepression, and on the institutions making them nontransparentand otherwise resistant to public control.Among other things it would include:• Offshore financial centres and political arrangementsthat perpetuate them;• Capital flight and the mechanisms, such as misinvoicing,that perpetuate them;• Disproportionate influence exercised by extractiveindustries, such as through their subsidisation andspending powers in public life, both in Angola,Western Europe, the USA and perhaps elsewhere;• Military arrangements, especially with China and theUSA,• Initiatives to make these and other private supranationalflows (also of arms and military services)transparent and subject to public control.Lenses to look at Angola’s current and futureprospects should firstly be wide enough to include83 Oliveira, R. S. 2007, Oil and Politics in the Gulf of Guinea, NewYork: Columbia Univ Press, p. 336Working Paper 81

23The current world economic crisis, with the financialsector at its heart, has exposed the massive regulatorydeficit in national and global governance. Somepolitical leaders have raised hopes that this governancedeficit is going to be tackled. Yet preferences for ‘softlaw’ and for corporate self-regulation are deeplyentrenched. Political classes in the USA and WesternEurope are meeting strong push-backs fromcorporations, tax havens and the financial industryabetted by mainstream media, much of which is inhands of corporations benefiting from nontransparencyrules and other forms of global badgovernance. Angola’s involvement in these politics isnot clear, although tough talk from OPEC (of whichAngola holds the presidency at present) suggests itscollusion in political counter-offensives in globalforums.A longer-term viewA longer-term perspective would be more coherent tothe extent that it looks beyond Angola’s current oilboom, which is likely to have passed by 2020. Thatview would necessarily consider today’s developmentmodel and its likely consequences in ten years’ timeagainst a backdrop of more-or-less clear trends, suchas demographic changes, and less predictable butlooming risks, such as water stress due to climatechange. Among those consequences, particularattention should be given to the pace and direction ofchange in:• inequalities, both ‘vertical’ among social strata, and‘horizontal’ among regions and ethno-linguisticgroups,• distribution of productive assets, particularly land;• domestic markets in domestically-produced goods, asmeasured against the servicing of foreign marketsand reliance on imports;• distribution of public goods, particularly water,sanitation and health;• development of means to clarify and settle conflictsand to protect basic rights.These trends underpin likely political dynamics,including the rise of new social groupings and thepolitical space in which they might develop.Also needing a longer-term view is Angola as a playerin global climate politics and as a probable victim ofclimate change. The world’s current hydrocarbonintensivedevelopment model fosters policy incoherenceat many levels. The issue surpasses the scope of thispaper, but merits attention in the case of Angola, whoseresilience is put at risk in at least two ways: revenuevolatility (and possible decline) as petroleum isdethroned from the centre of global energy andinvestment equations; and environmental stress,particularly related to water supplies, as climatechange intensifies. Furthermore, hydrocarbon-basedstates and their corporate allies have gained powerful,even commanding positions in geo-politics. ‘[T]hefinancial muscle of authoritarian states’, concludes aleading British newspaper, ‘has as much bearing on thedirection of the world economy as the wealth of liberaldemocracies.’ 84 That muscle today expresses itself in,among other things, efforts by the hydrocarbon bloc toblock strong measures to mitigate climate change. 85Among oil exporters Angola is a relatively minorplayer, but does align itself with others, including SaudiArabia and Russia, in discouraging alternatives to thehydrocarbon-based model. Angola plays a role, albeit amodest one, in the politics of the planet’s future.Enabling a responsive stateForeign governments, business oracles, internationalfinancial institutions and Washington DC think-tanksexpress enthusiasm about Angola’s ‘miracle’. Thecautious development economist Paul Collierspeculates optimistically about Angola and theautocratic model he sees it exemplifying:It is quite possible that the next quarter century willsee this model of the developmental autocrat ruling a84 The Observer 2008, ‘Democracy triumphs through example, notforce’ (editorial), 31 August85 Barnett, Jon 2008, ‘The worst of friends: Opec and G-77 in theclimate regime’ Global Environmental Politics 8:4 pp 1-8Angola: ‘Failed’ yet ‘Successful’David Sogge

24strong state spreading to countries with betteropportunities. Angola, with its oil and its Atlanticcoastline, could well prove to be another Malaysia. 86Angola’s state is today stronger than might have beenexpected. It beat back a serious Cold War effort tooverthrow it, widened its political base and consolidateditself as a stable autocracy. But public administration andservices remain weak and unevenly spread. Consumptionand investment have shot up, but there is no sign of itbecoming a ‘developmental’ state. Of six factors identifiedby Leftwich 87 as characteristic of developmental states,Angola lacks four important ones, namely:• a determined elite guided by a modernising vision forthe whole nation;• state autonomy from the interests of powerfulcliques;• a competent economic bureaucracy insulated fromspecial interests;• the capacity for effective management of privateeconomic interests.borders. The regime depends overwhelmingly on nontransparent,supranational arrangements in realms ofmilitary and corporate power, including themanagement of financial stocks and flows. Thatextraverted basis of political power seems likely tocontinue, even if domestic interest blocs develop.However, beyond 2015, after oil output and revenueshave peaked and debt payments begin to fall due,those offshore arrangements could lose theirattractions. Angola’s historical pattern of economicboom and bust, and of successive development modelslaunched only to end up shipwrecked, appears to berepeating itself. To escape this pernicious cycle,Angolans themselves must gain the widest and bestinformedspaces possible for open discussion. Today,at a time of unprecedented economic and ecologicalcrisis, the means and imperatives for an in-depthdebate have intensified. Important tenets of capitalistgrowth are being critically re-visited. Alternativemodels appear more viable and even necessary. It istime to adopt a new compass and chart another wayforward.Angola does, however, possess two characteristics ofthis developmental state model, namely:• a weak and subordinated civil society; and• an uneasy mix of repression, poor human rights andlegitimacy.As long as powerful and poorly-regulated offshoreincentives continue to shape elite motivations and visionsof Angola’s future, the prospects for transformation – abroad developmental vision, state autonomy fromspecial interests, an effective bureaucracy andentrepreneurial class – look anything but bright.This conclusion has three implications:First, as an extraverted polity, Angola’s developmentalspace extends well beyond the country’s territorial86 Collier, P. 2008, ‘Paths of Progress in Africa’ World PolicyJournal, Fall, p. 20687 Leftwich, A. 1995, ‘Bringing politics back in: towards a modelof the developmental state’, Journal of Developmental Studies, 31:3 p.400-427Second, and in the meantime, a ‘developmental state’along the lines of Vietnam or Malaysia is unlikely toemerge in Angola. A pluralist model - a polity basedon many competing forces in an open political arena– is also improbable. More likely therefore is ascenario of inequitable, unsustainable growth shapedby state patronage backed from abroad by USmilitary and economic power. Under thesecircumstances, a realistic way forward in the shortterm is to promote a ‘minimally responsive state’, onethat would act as chief duty-bearer toward a rightsholdingcitizenry. As the government rolls out‘decentralisation’, formal spaces for citizen-stateinteraction may open to some extent. Precedents forstate-society engagement are already present in suchareas as the co-production of health and educationservices with church bodies and NGOs, and inconsultative platforms of residents and localauthorities, or of parents and school officials.Third, amidst today’s economic crisis, unprecedentedopportunities are at hand to reform supra-nationalWorking Paper 81

25systems and incentives that promote and perpetuatedistorted and non-transparent governance both incountries like Angola and Western democracies. Thereis a need for more active engagement by consumingpublics, 88 by academic and think-tank researchers,investigative journalists and media gatekeepers, and byofficials and public watchdogs. As the persistence ofinstitutional weaknesses and dangerous inequities inAngola can be traced to the lack of good publicgovernance at supra-national levels, today’s crisis is anopportunity for progressive advances both in Angolaand elsewhere.88 As proposed by Benner, T. and R. S. de Oliveira 2007, ‘Gettingtough with the petro-elites’, International Herald Tribune, 10 AprilAngola: ‘Failed’ yet ‘Successful’David Sogge

26WORKING PAPERS81 Angola: ‘Failed’ yet ‘Successful’, David Sogge, April 200980 Impasse in Euro-Gulf Relations, Richard Youngs, April 200979 International division of labour: A test case for the partnership paradigm. Analytical framework andmethodology for country studies, Nils-Sjard Schulz, February 200978 Violencia urbana: Un desafío al fortalecimiento institucional. El caso de América Latina, Laura Tedesco,Febrero 200977 Desafíos económicos y Fuerzas Armadas en América del Sur, Augusto Varas, Febrero 200976 Building Accountable Justice in Sierra Leone, Clare Castillejo, January 200975 Plus ça change: Europe’s engagement with moderate Islamists, Kristina Kausch, January 200974 The Case for a New European Engagement in Iraq, Edward Burke, January 200973 Inclusive Citizenship Research Project: Methodology, Clare Castillejo, January 200972 Remesas, Estado y desarrollo, Laura Tedesco, Noviembre 200871 The Proliferation of the “Parallel State”, Ivan Briscoe, October 200870 Hybrid Regimes or Regimes in Transition, Leonardo Morlino, September 200869 Strengthening Women’s Citizenship in the context of State-building: The experience of Sierra Leone,Clare Castillejo, September 200868 The Politics of Energy: Comparing Azerbaijan, Nigeria and Saudi Arabia, Jos Boonstra, Edward Burke andRichard Youngs, September 200867 Democratising One-Party Rule? Political Reform, Nationalism and Legitimacy in the People’s Republic ofChina, Shaun Breslin, September 200866 The United Nations Mission in Congo: In quest of unreachable peace, Xavier Zeebroek, July 200865 Energy: A Reinforced Obstacle to Democracy?, Richard Youngs, July 200864 La debilidad del Estado: Mirar a través de otros cristales, David Sogge, Julio 200863 IBSA: An International Actor and Partner for the EU?, Susanne Gratius (Editor), July 200862 The New Enhanced Agreement Between the European Union and Ukraine: Will it Further DemocraticConsolidation?, Natalia Shapovalova, June 200861 Bahrain: Reaching a Threshold. Freedom of Association and Civil Society in the Middle East and NorthAfrica, Edward Burke, June 200860 International versus National: Ensuring Accountability Through Two Kinds of Justice, Mónica Martínez,September 200859 Ownership with Adjectives. Donor Harmonisation: Between Effectiveness and Democratisation. SynthesisReport, Stefan Meyer and Nils-Sjard Schulz, March 200858 European Efforts in Transitional Justice,, María Avello, May 200857 Paramilitary Demobilisation in Colombia: Between Peace and Justice, Felipe Gómez Isa, April 200856 Planting an Olive Tree: The State of Reform in Jordan. Freedom of Association and Civil Society in the Middle Eastand North Africa: Report 2, Ana Echagüe, March 200855 The Democracy Promotion Policies of Central and Eastern European States, Laurynas Jonavicius, March 200854 Morocco: Negotiating Change with the Makhzen. Project on Freedom of Association in the Middle East and NorthAfrica, Kristina Kausch, February 200853 The Stabilisation and Association Process: are EU inducements failing in the Western Balkans?, Sofia Sebastian,February 200852 Haiti: Voices of the Actors. A Research Project on the UN Mission, Amélie Gauthier and Pierre Bonin, January 200851 The Democratisation of a Dependent State: The Case of Afghanistan, Astri Suhrke, December 2007Working Paper 81

27WORKING PAPERS50 The Impact of Aid Policies on Domestic Democratisation Processes: The Case of Mali. DonorHarmonisation: Between Effectiveness and Democratisation. Case Study 4, Hamidou Magassa and StefanMeyer, February 200849 Peru: the Kingdom of the ONG?, Donor Harmonisation: Between Effectiveness and Democratisation. CaseStudy 3, Enrique Alasino, February 200748 The Nicaragua Challenge. Donor Harmonisation: Between Effectiveness and Democratisation. Case Study 2,Claudia Pineda and Nils-Sjard Schulz, January 200847 EU Democracy Promotion in Nigeria: Between Realpolitik and Idealism, Anna Khakee, December 200746 Leaving Dayton Behind: Constitutional Reform in Bosnia and Herzegovina, Sofía Sebastián, November 200745 The "Third Populist Wave" of Latin America, Susanne Gratius, October 200744 OSCE Democracy Promotion: Griding to a Halt?, Jos Boonstra, October 200743 Fusing Security and Development: Just another Euro-platitude?, Richard Youngs, September 200742 Vietnam’s Laboratory on Aid. Donor Harmonisation: Between Effectiveness and Democratisation. Case Study1, María Delfina Alcaide and Silvia Sanz-Ramos, September 200741 Theoretical Framework and Methodology for Country Case Studies. Donor Harmonisation: BetweenEffectiveness and Democratisation, Stefan Meyer y Nils-Sjard Schulz, September 200740 Spanish Development Cooperation: Right on Track or Missing the Mark?, Stefan Meyer, July 200739 The European Union and the Gulf Cooperation Council, Ana Echagüe, May 200738 NATO’s Role in Democratic Reform, Jos Boonstra, May 200737 The Latin American State: ‘Failed’ or Evolving?, Laura Tedesco, May 200736 Unfinished Business? Eastern Enlargement and Democratic Conditionality, Geoffrey Pridham, April 200735 Brazil in the Americas: A Regional Peace Broker?, Susanne Gratius, April 200734 Buffer Rus: New Challenges for Eu Policy towards Belarus, Balazs Jarabik and Alastair Rabagliati, March 200733 Europe and Russia, Beyond Energy, Kristina Kausch, March 200732 New Governments, New Directions in European Foreign Policies?, Richard Youngs (editor), January 200731 La Refundación del Estado en Bolivia, Isabel Moreno y Mariano Aguirre, Enero de 200730 Crisis of State and Civil Domains in Africa, Mariano Aguirre and David Sogge, December 200629 Democracy Promotion and the European Left: Ambivalence Confused?, David Mathieson and RichardYoungs, December 200628 Promoting Democracy Backwards, Peter Burnell, November 200627 Respuestas globales a amenazas globales. Seguridad sostenible para el siglo XXI, Chris Abbott, PaulRogers y John Sloboda, Septiembre de 200626 When More is Less: Aiding Statebuilding in Afghanistan, Astri Suhrke, September 200625 The Crisis in Timor-Leste: Restoring National Unity through State Institutions, Culture, and Civil Society,Rebecca Engel, August 200624 Misión de la ONU en la República Democrática del Congo: Imponer y consolidad la paz más allá de laelecciones, Luis Peral, Julio de 200623 Angola: Global “Good Governance” Also Needed, David Sogge, June 200622 Recovering from Armed Conflict: Lessons Learned and Next Steps for Improved International Assistance,Megan Burke, April 200621 Democracy and Security in the Middle East, Richard Youngs, March 200620 Defining ‘Terrorism’ to Protect Human Rights, Ben Saul, February 200619 Failing States or Failed States? The Role of Development Models: Collected Works; Martin Doornbos,Susan Woodward, Silvia Roque, February 2006Angola: ‘Failed’ yet ‘Successful’David Sogge

28WORKING PAPERS18 Facing the Victims in the Global Fight against Terrorism, Jessica Almqvist, January 200617 Transition and Legitimacy in African States: The cases of Somalia and Uganda, Martin Doornbos,December 200516 The United Nations’ Responsibility towards Victims of Terrorist Acts, Irune Aguirrezabal Quijera,November 200515 Threats to Human Security: The Need for Action?, Luis Peral, October 200514 Helping Castro? EU and US policies towards Cuba, Susanne Gratius, October 200513 Alliance of Civilisations: International Security and Cosmopolitan Democracy, Kristina Kausch and IsaíasBarreñada, October 200512 Building a New Role for the United Nations: the Responsibility to Protect, Carlos Espósito and JessicaAlmqvist, September 200511 Political Reform and the Prospects for Democratic Transition in the Gulf, Jill Crystal, July 200510 Aggression, Crime of Aggression, Crime without Punishment, Antonio Remiro Brotóns, June 20059 España y el Magreb durante el segundo mandato del Partido Popular. Un período excepcional, LauraFeliú, Mayo de 20058 EU instruments for conflict prevention, Javier Niño Pérez, April 20057 Contribución española a la construcción de la paz. Razones y propuestas para la elaboración de un Plande Acción, Luis Peral, Abril de 20056 Spain and Morocco: Towards a Reform Agenda?, Richard Gillespie, April 20055 Which Justice for Perpetrators of Acts of Terrorism? The Need for Guidelines, Jessica Almqvist, March 20054 Reflexiones sobre la reforma del Servicio Exterior de España, Carlos Espósito, Febrero de 20053 Political Islam: Ready for Engagement?, Emad El-Din Shahin, February 20052 Ten years of the Barcelona Process: A Model for Supporting Arab Reform?, Richard Youngs, January 20051 A proposal for governance of the Gaza strip in the context of the announced Israeli withdrawal, CITPax,an initiative of Shlomo Ben-Ami, November 2004Working Paper 81

For years, as a former Cold War battleground, Angola has stood out on world leaguetables of ‘failed’ or ‘failing’ states. Yet its army has a formidable record of domesticand foreign combat. Its national oil company is of world class. In recent years itseconomy has grown at a feverish annual rate of 18 percent. Its government hassuccessfully ended 40 years of violent conflict, consolidated its political base andnegotiated profitable deals with major public and private bodies of the UnitedStates, Europe and China. For such a country, how valid is the label ‘failed state’?In light of this seeming paradox, this paper addresses several critical questions. Whatare the historical roots of conflict in Angola, and of its weak and uneven state andpolitical institutions? How deeply is Angola’s political economy integrated intointernational systems, and what aspects of that integration help explain both theweaknesses and strengths of state and political institutions? What formal andinformal forces and incentives are at work in Angola’s territorial political economythat affect state and political resilience and weakness?It concludes by suggesting ways European and other international decision-makersmight look afresh at notions of state weakness in general, and their relevance to thecase of Angola in particular.www.fride.orgGoya, 5-7, Pasaje 2º. 28001 Madrid – SPAIN. Tel.: +34 912 44 47 40 – Fax: +34 912 44 47 41. Email: fride@fride.org