Angola Country Profile
Environment, Natural Resources and Extractive Industry
Business Corruption
Companies should note that corruption is rife in both the oil and diamond sectors, which are characterised by poor and inefficient regulations, political interference and state-owned companies with monopolistic powers that are often used as instruments for diverting funds to political elites. Foreign investors are usually required to enter into joint ventures/production sharing agreements with state-owned giants in both sectors (Endiama in the diamond sector and Sonangol in the oil sector) that enjoy access to subsidised capital. However, these local companies are frequently accused of being at the centre of the systematic diversion of public funds in Angola. For further information on corruption in Angolan extractive industries, see this profile's special page on the oil and mining sectors.
Companies report that bribery is not uncommon when dealing with environmental inspections in Angola. For instance, Global Integrity 2010 reports that business inspections by government officials to ensure public environmental standards are often carried out in an arbitrary and ad-hoc manner, and bribes are sometimes extracted from companies in return for favourable treatment or expedited processing
Political Corruption
The Angolan government has for many years enjoyed a booming income from the Angolan oil sector, which is completely dominated by the 100% state-owned oil company, National Fuel Society (Sonangol). The government extracts USD billions from Sonangol's activities each year, which is claimed to act as a disincentive for government investments in other sectors. Some members of the political elite allegedly uses Sonangol as an instrument for diverting funds for personal gain and observers estimate that a large proportion of its earnings never reach the Angolan treasury. According to the Revenue Watch Institute Angola profile, however, transparency in the management of oil revenues has improved significantly since 2002, due to pressure from international institutions.
For further information on corruption in Angolan extractive industries, see this profile's special page on the oil and mining sectors.
