Africa’s largest crude oil producer behind Nigeria, Angola plans to privatize 74 state companies over the next five years in order to increase efficiency and cut costs.
According to the prospectus sent to investors as part of the country’s Eurobond issuance, the state-owned enterprises would be predominantly those in the industrial sector. The government aims to revive the oil-dependent economy by welcoming foreign investors to the country.
The Southern African country is in the process of raising $3 billion through two Eurobond issues, launching $1.75 billion in 10-year notes at 8.25 percent and a $1.25 billion in a 30-year tranche at 9.375 percent.
President João Lourenço, who took office in September 2017, pledged to reduce state interference in the economy that is still recovering from 27 years of the civil war which plagued it from its independence in 1975 to 2002.
“Generally, the government intends to sell its entire interest in these companies, the majority of which operate in the industrial sector,” a copy of prospectus which was seen by Reuters said.
Details of the companies to be sold or the amount that could be raised from the privatizations were not indicated in the prospectus. However, Reuters reported that unnamed government sources said Angola’s ports, national carrier TAAG, BCI bank, and insurer Ensa were all being considered for full or partial privatization.
“The government’s long-term policy is that companies which, in the government’s view, are not required to remain under public ownership as a matter of policy should eventually be privatized,” the prospectus added.