Chapter V - What Are the Possible Factors Prompting Sub-Saharan African States to
5.1 Ideology, Natural Resource Rics, Pariah States, Countries with International Ambitions,
5.2.2 The Case of Angola
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The case of Angola can be helpful in confirming this trend. Angola is Africa’s top oil exporter to the PRC and the PRC is Angola’s main trading partner. This has resulted in a close relationship between the two countries involving not only economic, but also political aspects, a fact which has conferred almost no space of maneuvering for the ROC to court the administration in Luanda to establish diplomatic relations with Taipei at the expense of Beijing.
5.2.2 The Case of Angola
The ROC has never had any sort of official diplomatic relations with Angola. In fact, in the two China’s quarrel, it was the PRC who actively sought to court liberation movements fighting against the Portuguese colonial rule within the context of the Cold War and its diplomatic strategy to limit the ROC’s diplomatic overtures on the continent. For the ROC, despite one reported attempt during the mid-1990s, when Taipei sent an official to Luanda with the mission of convincing the country to consider switching sides, this efforts proved to be unsuccessful and relations with the PRC have been maintained up to now (Campos and Vines, 2008). In fact, the ROC relations with Angola have never reached more than an economic level. In 1992, Luanda sent its Deputy Minister of Oil to Taipei to sign a Special Agreement with the ROC, which resulted in the setup of the ROC’s Special Delegation in Angola in the end of the same year, which lasted until the year 2000 (Tseng, 2008)24. On the other hand, Angola’s relations with the PRC have positively evolved over time. Beijing, not only supported the country during its struggle for independence, but it has also stepped up to assist Luanda in its economic reconstruction in the post-civil war period and proved to be an important ally of Luanda in the international arena.
The PRC’s interactions with Angola can be traced back to the period of anticolonial struggle through its support for the three main liberation movements fighting in the country:
the Movimento Popular de Libertacao de Angola (MPLA), União Nacional para a Indêpendencia Total de Angola (UNITA), and the Frente Nacional para Libertação de
24 The end of the 1990s was considered the last period of major fighting of the Angolan civil war. According with Tseng (2008), the escalation of violence in the country in the end of the 1990s caused relations to come to a standstill. So far, no Taipei’s representative office has been set up in Angola, a fact which can be partly explained by Luanda’s close relationship with Beijing, and the ROC’s minor economic and inexistent political interactions with Angola.
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Angola (FNLA) (Campos and Vines, 2008). During the 1960s, the MPLA benefited from the political and military support provided by Beijing. However upon the Organization of African Unity (OAU) recognition of FNLA and UNITA as legitimate liberation movements, the PRC’s assistance came to an end and Beijing shifted its interest to both the FNLA and UNITA.
With the end of the Cultural Revolution, the PRC decided once again to provide military assistance to MPLA. Yet, internal divisions within the Movement, coupled with Beijing's desire to balance Moscow’s strong support for the MPLA made this aid very brief.
The PRC’s support again shifted to the FNLA and UNITA whose outcome ended up being fruitless. In November 1975, the Soviet-backed MPLA came to power and proclaimed the country’s independence. (Campos and Vines, 2008). Official diplomatic relations between the two countries would only be established in 198325. Minor interactions mainly based on defense and military cooperation characterized the Sino-Angola relationship until the early 2000s.
Sino-Angola relationship is nowadays very solid and three main factors might explain this reality. The first, concerns the end of the civil war in Angola in 2002, which lasted 27 years. The second is the fact that in 1993, Beijing became a net oil importer which required a new diplomatic offensive in search of energy resources. Finally, the creation of FOCAC has enabled the PRC to solidify its relations with the African countries and pursue its interests on the continent.
Currently, cooperation based on natural resources (in which infrastructure projects provided by the PRC are often included) has played a decisive role in boosting the development of economic and political relations between the PRC and Angola, and has added new and vital content to their bilateral relations (Mo, 2012). Luanda’s need of infrastructures and Beijing’s quest for natural resources (with special emphasis on crude oil) have allowed these two countries to engage in a very close relationship which has not only
25 Two main reasons prompted the PRC to establish formal ties with the MPLA in 1983 despite its previous support to both the FNLA and UNITA. The first, was that the PRC’s support to FNLA and UNITA strained relations with its long standing friend Tanzania (a staunch supporter of MPLA), a fact which caused Beijing to pull back. The second reason has been associated to the improvement of Sino-Soviet relations in the early 1980s, and the change of leadership in the PRC (Deng Xiao-ping in 1978) and in Angola (Jose Eduardo dos Santos in 1979) (Alves, 2011; Shin, H. D. and Eisenman, 2012).
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raised concerns in the West, but also provided very little space for the ROC to try to engage in diplomatic official ties with Angola.
In March 2004, the PRC’s Export-Import Bank (EXIM) provided a US$2 billion infrastructure oil backed loan to Angola on very favorable terms, a deal which came as result of Luanda’s unwillingness to accept the International Monetary Fund’s (IMF) conditional loan package. By 2010, the EXIM bank had extended a total of US$ 10.5 billion in oil backed credit lines to Luanda (Corkin, 2011). These loans were targeted specifically towards facilitating public investment in the country. According to the conditions of the loans, Chinese companies are essentially contracted to undertake recommended projects and are paid directly by China Exim Bank, which writes down the contract amount against oil sales made to the Chinese government (Corkin, 2011). In 2004, Sinopec Group26 managed to acquire a 50% share in deep water Block 18 which previously owned by Shell. The framework and procedures involved in the process, illustrates the critical role played by this loan and the connections at the highest level that came with it (Alves, 2011).
In 2005, The PRC provided another US$ 2 billion loan in exchange for oil deals, which was further supplemented with an additional US$ 1 billion in 2006. The credit, approved by the EXIM bank, included once more infrastructure reconstruction which had been destroyed during the Angolan civil war. In return, the PRC would get 10.000 barrels of oil per day.
In September 2007, a new infrastructure oil-backed loan of $2 billion was signed in Luanda between the Angolan government and the Chinese EXIM Bank. Sonangol27 became the guarantor of the loan, and its repayment was to be done with the proceeds of oil sales from Sonangol to UNIPEC (China international United Petroleum & Chemicals Co. Ltd, Sinopec group), which were to be deposited in the Angolan Ministry of Finances (MINFIN) account at EXIM Bank (Campos and Vines, 2007; Alves, 2011). This loan was followed by another three provided in 2009, totally amounting to US$ 10 billion. The table below
26 China Petrochemical Corporation (Sinopec) is one of the PRC’s main state owned enterprises in the oil industry. The National Petroleum Corporation (CNPC) and the China National Offshore Oil Corporation are the other ones.
27 Sonangol (Sociedade Nacional de Combustiveis de Angola) is Angola’s state owned company responsible to oversee oil and natural gas production in the country.
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provides a list of the major Chinese loans to Angola from 2002 to 2010 in which infrastructure projects have often been included.
Table. 7 Major Chinese ‘resources for infrastructure’ loans in Angola (2002-2009)
Main export to
The scale of the PRC’s investments in Angola is impressive and its ‘resources for infrastructures’ approach quite successful’. This strategy of swapping infrastructure projects for natural resources has been known as ‘the Angolan mode’ and it has also been adopted by Beijing in other sub-Saharan resource rich countries such as Nigeria, Gabon and the DRC (Alves, 2011). For the case of Angola, this approach not only has been very welcomed by its government as the country is still in the process of reconstruction after the nearly thirty years of civil war, but it has also provided an alternative source of investments to the traditional western partners. Unlike western countries, the PRC stance of ‘non-interference’ is highly attractive to Angola (an oppressive, dictatorial regime by any
28 China Development Bank (CDB).
29 Industrial and Commercial Bank of China (ICBC).
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standards) as the latter does not impose any conditionality (except from the need of accepting the ‘One China’ principle) when conducting business or providing development aid to the former. Thus, the PRC has been able to largely increase its presence in Angola and in the spate of approximately ten years it has become Angola’s largest trading partner (Table. 8).
Table. 8. Angola’s Exports by Destination between 2000 and 2011
2000 2011
Country Percentage Country Percentage
US 52.3% PRC 42.3%
PRC 25.6% US 22.6%
South Korea 9.1% India 10.2%
France 5.3% Canada 4.2%
Spain 2.7% Italy 3.5%
Source: UN Comtrade, 2015; Observatory of Economic Complexity (OEC), 2015.
In the Angolan exports by destination, the PRC in 2000, ranked second. However, by the end of 2011, it had already surpassed the US leading the list of Angola’s top export destinations. Yet, even more interesting to see is the composition of Angola’s exports to the PRC (Table. 9).
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Table. 9 Composition of Angola’s Exports to the PRC in 2012
Products Amount - US$ Billions Total Percentage
Oil US$21.6 99.5%
Granite US$ 0.7 0.03%
Quartz US$ 0.2 0.01%
Wood US$0.06 0.00%
Sports Equipment US$0.02 0.00%
Scrap-Iron US$0.02 0.00%
Fish Oil US$0.02 0.00%
Scrap-Aluminum US$0.01 0.00%
Scrap-Copper US$0.01 0.00%
Electric Transformers US$0.01 0.00%
SubTotal US$22.65 99.9%
Other Products US$ 0.02 0.01%
Total US$22.67 100%
Source: UN Comtrade, 2015; IMF, 2014; Observatory of Economic Complexity (OEC), 2015
Table 3 shows that the composition of Angola's exports to the PRC is predominantly based on crude oil, with 99.95% of the total; the remainder is divided mainly from ores and scraps. The data shows the extreme dependence that the country has in this sector as well as the role that the PRC plays in promoting this trend.
The PRC’s position as Angola’s main export destination of crude oil has been maintained up to now (Figure. 4). However, another important development has occurred in
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the last few years which confirm the solid evolution of ties between Beijing and Luanda. In fact, whereas Portugal had been Angola’s top source of imports until 2013, yet in 2014 the PRC displaced Portugal as the top source of imports to Angola (Table 10).
Figure 4. Angola’s Crude Oil Exports by Destination in 2014
Source: http://www.eia.gov/beta/international/?fips=ao
Table. 10 Imports Origin of Angola in 2014 - Top 5
Country Amount (US$ Billions) Percentage
PRC 3. 910. 670. 757. 00 21%
Portugal 3, 855, 224, 901,00 20%
South Africa 1, 647, 153, 855, 00 8.7%
Brazil 1, 142, 760, 012, 00 6.0%
US 938, 657, 597, 00 4.9%
Source: Observatory of Economic Complexity, 2015
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Table 10 shows that, although by a small margin, the PRC is now Angola’s top source of imports, thus displacing Portugal which had been the country’s main imports’
origin until very recently. It also reinforces Beijing’s position as Luanda’s main trading partner and an essential partner in Angola’s political and economical development.
In fact, this relationship, which has undeniably been built by the PRC’s resource driven economic policy and Angola’s need of new sources of investment, has also been strengthened by the willingness of both sides in building closer political ties. In this case, the intensification of the number of official visits and exchanges between officials and leaders of both countries since the early 2000s, reflects the importance of this relationship attached by the two administrations and their desire to further expand their interactions beyond the economic realm.
Due to Angola’s civil war and the marginal importance of the relationship for both countries until the early 2000s, official visits were rare. Yet, there were some important Chinese state visitors to Angola, such as Foreign Minister Qian Qi-chen and Vice-Premier Zhu Rong-ji, and two official visits by President Dos Santos to the PRC were undertaken ten years apart (Alves, 2011).With the end of the civil war, the number of bilateral official visits and exchanges clearly intensified as is shown in table 11.
Table 11 PRC-Angola High Ranking Official Bilateral Exchanges (1988-2015)
Chinese government official visits to Angola
Angolan government official visits to China
Year Name Year Name
1995 Vice-Premier
Zhu Rong-ji
1998 President
Eduardo dos Santos
2001 Foreign Affairs 2006 Prime Minister
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Source: Elaborated by the author with data retrieved from: Macauhub 2011; Alves, 2011; and Xinhua, 2015.
The year of 2010 was particularly intense in high level official visits, namely Angola’s Vice President Fernando Piedade dos Santos’s visit to Shanghai accompanied by a ministerial delegation including the Minister of Geology, Mining and Industry; Minister of Commerce; Minister of Urban Development and Construction; and Minister of Agriculture and Rural Development. In the same year, the then Chinese Vice- President Xi Jin-ping visited Luanda, and signed a joint declaration to upgrade bilateral relations to
‘strategic partnership’, whose goal was to reinforce coordination and strengthen cooperation in all sectors (Alves, 2011). In 2014, during Prime Minister Li Ke-qiang’s visit to Angola it was signed a memorandum of understanding between a Chinese company and the Angolan Ministry of Transport to build “mega-infrastructures” in the country. Moreover, Li Ke-qiang also promised a US$ 29 million in development aid to the country (Macauhub, 2014).
As mentioned before, Taipei’s current interactions with Luanda are minor, especially when compared to the scale of involvement of the PRC in the country. Despite of some purchases of oil, the ROC relations with Angola apparently will hardly evolve from
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these circumstances as Angola not only seems to cherish the nature of its ‘strategic relationship’ with the PRC, but it has also provided unconditional support to the PRC regarding the ‘One China’ principle. This support can be attested, for instance, when in 2006, during Chinese Premier Wen Jia-bao's official visit to Angola, the Chinese government and the Angolan government issued a joint communiqué, in which Angola reiterated its “adherence to the one-China policy, recognizing that the government of the PRC is the sole legitimate government representing the whole of China. The Angolan government holds that Taiwan is an inalienable part of Chinese territory, reaffirming its firm support for the Chinese government's efforts for national reunification” (MOFCOM, 2006).
5.2.3 Conclusion
Resource rich sub-Saharan countries have seen Beijing as an alternative partner to the traditional western countries. Their need for new sources of investment, coupled with the PRC’s desire to secure natural resources abroad, as well as its own approach of ‘non-interference’ and ‘no-strings attached’ have resulted in a close relationship which both the PRC and these countries cannot afford to ignore. This has hindered the ROC’s ambitions to be recognized by resource-rich states located in sub-Saharan Africa as such decision would immediately imply the loss of large sums of investments made by the PRC, which refuses to do ‘serious business with countries maintaining diplomatic ties with the ROC’.
The case of Angola provides significant evidences on how natural resources have laid the ground for a close relationship between Luanda and Beijing, a situation which has provided almost no space for the ROC to attempt to court the Angolan government to switch sides.
The PRC’s presence in Angola dates back to the liberation struggle period where it had supported the liberation movements fighting the Portuguese colonial rule. Official relations between the two countries were established in 1983, yet, at a very low profile until the early 2000s. For the ROC, despite one reported attempt during the 1990s aiming at convincing Angola to switching sides and the setup of a representative office in Luanda in the same period, Taipei has never been able to expand its relations with Angola to the
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diplomatic level. And the expectations do not seem the best. Starting in the early 2000s, a new relationship between Angola and the PRC based on natural resources (in which infrastructure projects provided by the PRC are often included) has played a crucial role in promoting the development of political relations between the PRC and Angola, and has added new and important content to their bilateral relations. In this context, a move by Angola towards recognizing the ROC at the expense of the PRC became even more unlikely.
With the end of the civil war, the oil-rich country’s needs for reconstruction were enormous. On the other side, there was the PRC, which in order to keep the pace of its domestic economic growth, engaged in a new quest for natural resources abroad, in which Angola has played a crucial role. It was in this context of a convergence of interests that the relationship between the two countries gained a new momentum. The PRC’s adoption of the ‘oil for infrastructures’ approach, (the Angola mode) perfectly suited Angola’s needs for infrastructure reconstruction, and also provided Luanda with a new alternative and reliable source of investment and development aid, with no conditions attached, which highly appeased Luanda’s corrupt and dictatorial regime. The scale of investments and trade between the two countries, not only allowed the PRC to become Angola’s biggest trading partner but it has also made Angola its main oil supplier in Africa.
In addition, this relationship has been further strengthened by the willingness of both sides in building closer political ties. In this case, intensive official visits and exchanges of both countries have been taking place since the early 2000; joint declarations and new agreements have been signed, clearly evidencing the desire of the two administrations to further expand their interactions beyond the economic realm.
The strategic nature in which the relationship between Angola and the PRC has evolved, makes it hard to imagine how would Taipei be able to convince Luanda in siding with the ROC at the expense of the PRC. In fact, Angola’s current position as the PRC’s main oil supplier in Africa, the PRC’s position as Angola’s main trading partner, and the increasing number of bilateral official visits of both countries, shows that Sino-Angola ties are far from becoming weak. Thus, although perhaps not fully explaining it, Angola’s decision in not recognizing the ROC, seems to lie, at least in part, in the advantages brought
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about by its new relationship with the PRC in which the role of natural resources has been vital.