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Portuguese escape austerity and find a new El Dorado in Angola

Category : Business

The booming, oil-rich African country of Angola has become a refuge for Portugal’s jobless, while Luanda’s elite take advantage of EU troubles to buy up property in Lisbon

Pungent cigar smoke drifts across the veranda at one of Luanda’s upmarket beachside restaurants. It is Saturday afternoon and four Portuguese men are lounging with drinks, savouring the good life and rubbing shoulders with a nascent local elite. “The Angolans have money and we need it,” muses José Luis Sousa, 47, who moved here four years ago and co-owns a printing company. “They are buying things in Portugal and around the world. In Portugal people don’t like this situation, but they have money and we don’t.”

The men are among tens of thousands of Portuguese who have emigrated to Angola in recent years. Capital, meanwhile, is flowing in the opposite direction, as Angolan millionaires snap up chunks of Portugal’s ailing economy. After five centuries of colonialism, and an era when thousands of Angolans fled to Portugal, the roles are in reverse. “Maybe some day Portugal will be a colony of Angola,” Sousa quips.

The economics are simple: Portugal is enduring its worst recession since the 1970s, with austerity measures imposed, unemployment at a record 15% and the economy predicted to shrink by 3% this year. So deep is the malaise that one government minister offered some provocative advice: “If people are unemployed they should leave their comfort zone and look beyond our borders.”

This is what they are doing in such former colonies as Angola, Brazil and Mozambique, whose economies hold up an inverted mirror to their own. Oil-rich Angola enjoyed growth averaging 15% between 2002 and 2008 and, although it then lost momentum, it is still posting figures that the eurozone would envy, with growth expected to recover to between 8% and 10% this year.

Angola is attractive to the Portuguese because of business and cultural links – not least a shared language – forged before it gained independence in 1975. A long, devastating civil war followed, but a decade of peace has transformed the desirability of taking part in sub-Saharan Africa’s third biggest economy.

The number of Portuguese living here has soared from 21,000 in 2003 to more than 100,000 last year, according to official figures which are likely to be a conservative estimate. Some 38% of foreign companies registered in Angola are Portuguese, media reports say, still well ahead of Chinese firms at 18.8%.

Luis Ribeiro opened a pizzeria in Luanda two years ago. Wearing a T-shirt bearing the name “Portugal” and his country’s flag, he reflected: “Definitely more Portuguese people are coming here in recent years, not only because of the bad financial situation in Europe but because Angola is one of the fastest-growing economies in the world.”

They are joining an influx that includes Chinese, Brazilian and, to a lesser extent, British investors. “We’ve always been one of the biggest communities, but we’re slowly being surpassed by the Chinese,” Ribeiro, 52, continued. “The Chinese are very resilient people and are prepared to do the donkey work that Portuguese and Angolans are not.”

Portuguese people are scenting opportunities in Angola’s thriving construction industry: the skyline of Luanda, the capital, is a symphony of cranes, new skyscrapers and the still incomplete dome of a parliament building by Portuguese company Teixeira Duarte. They are also finding work in banking and IT.

“There’s no humiliation in coming here,” Ribeiro added. “The Angolan government only accepts people with a decent CV looking for a proper job. It’s mostly professionals in the higher bracket. The language still matters. Communication is very important if you hold a high position and need to communicate with workers on a day to day basis. And of course there is a cultural understanding. In 500 years we left an imprint of everything, even a taste for wine, and the hostility towards us is long gone.”

As Europe lurches from financial crisis to crisis, Africa’s economic “lions” offer a lifeline. A 49-year-old supply chain manager, who preferred to give his name only as Mario, said: “Portugal is not in the best situation economically and it’s complicated for people to make a living. Angola is something of an El Dorado.” But El Dorado comes with sacrifices. Angola has one the highest costs of living in the world: a hamburger can cost £30 and admission to a nightclub might be £60. There are beautiful beaches but little by way of entertainment or shopping compared to most European capitals.

Given Angola’s estimated jobless rate of 26% and its yawning inequality, there seems potential for conflict between locals and foreign immigrant workers. Mario said: “Uneducated Angolans have a little bit of frustration. I don’t think we suffer the colonial hangover; maybe they do. Angola always had the potential to be something Portugal wasn’t. It’s so rich in everything: diamonds, oil, gold, copper. If we can contribute to the progress in this country, I think it’s a good thing… There’s a peaceful coexistence here. We are blood brothers.”

Carlos Araujo, 29, was born in Angola, moved to Portugal aged 10 and returned to Angola three years ago. The civil engineer said: “There are as many Portuguese people here now as when Angola was a colony. There’s no embarrassment; exactly the opposite. It’s kind of a salvation. Thank God it’s Angola and not another African country. Portuguese people are made to feel welcome here.”

The countries’ contrasting economic fortunes mean that, while Portuguese citizens are flooding Angola, money is streaming the other way. The Angolan elite are buying luxury homes in Lisbon and investing in Portuguese energy companies and banks. They now reportedly account for 4%, or £1.25bn, of the total value of companies listed on the Portuguese stock exchange. When the Portuguese prime minister, Pedro Passos Coelho, visited Luanda last year the symbolism was inescapable. Avoiding the chance to gloat, José Eduardo dos Santos, the Angolan president, said: “We’re aware of the difficulties the Portuguese people have faced recently and in such difficult times we must use our trump cards.”

Among the leading investors is Angola’s oil and gas giant Sonangol, which has a major stake in Portugal’s biggest private bank, and Isabel dos Santos, the president’s eldest daughter. One of Africa’s richest women – Forbes estimates her net worth as $170m (£106m) – she has stakes in Portuguese banking, energy, media and telecommunications. But critics say pieces of the Portuguese economy are being sold off at rock bottom prices, in effect to an authoritarian, corrupt regime. After 33 years, dos Santos is Africa’s second longest-serving leader, described by some as a dictator; last week he secured another landslide victory in elections criticised for lack of transparency.

Marcolino Moco, a former prime minister turned foe of dos Santos, said: “The regime is buying banks and other things in Portugal and no one in the EU is saying anything. They have to ask: ‘Where is the money coming from?’ It’s the children of the president. Sometimes, when I’m in Portugal, people like ex-MPs tell me, ‘Don’t worry, it’s part of politics’. I say no, what would happen in Portugal if one of the children of the president took over one of the TV channels?”

There were few Portuguese voices agitating for change at the recent election. The migration looks set to continue. But Moco added: “When Portuguese people come here, they improve their own situation but not that of the Angolan people. Because of the kind of regime we have, it won’t help the situation of young Angolans. We are living under dictatorship. Maybe people outside can’t see it very well.”

Tokyo tops expensive cities poll

Category : Business

Tokyo becomes the world’s most expensive city for foreign staff to live in, overtaking the Angolan capital Luanda, according to research.

Originally posted here: Tokyo tops expensive cities poll

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