How China and Angola are redefining economic ties for a post-oil, post-loans era

Name: China-built hydropower station in Angola enters main construction phase
Uploaded: 2024-03-18T06:07:28.000Z
Duration: 1 min 21 s
Description: China-built hydropower station in Angola enters main construction phase

Following decades of the ‘Angola model’ – oil-backed loans to access Chinese funding for infrastructure – Beijing vows to help modernise Angola

‘We addressed the problem of Angola’s debt to China … but also the need for the creditor to help us get out of the suffocating situation’: President Lourenco

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On Friday, Chinese President Xi Jinping holds a welcome ceremony for the President of the Republic of Angola, Joao Lourenco before their talks in Beijing. Photo: XInhua

Jevans Nyabiage

Published: 2:07pm, 18 Mar 2024Updated: 4:45pm, 18 Mar 2024

For two decades, oil has been the crux of Sino-Angolan relations, but now, in a post-oil and post-loans era, Angola is banking on mining, agriculture and manufacturing to redefine its economic ties with China.

On Friday, while hosting Angolan President Joao Lourenco for bilateral talks in Beijing, Chinese President Xi Jinping said China would help Angola “achieve agricultural modernisation, industrialisation and economic diversification”.

China will help Angola strengthen cooperation in mining and agricultural development and add further value in those sectors. According to a joint statement released after the meeting, Beijing will encourage Chinese enterprises to take part in “investment projects that support the upgrading of Angola’s industrial chain”.

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China-built hydropower station in Angola enters main construction phase

Xi and Lourenco also announced the elevation of bilateral ties between the two nations to a comprehensive strategic cooperative partnership, the highest level of bilateral relations for China.

Attracting Chinese private investment is part of Angola’s plan to cut its excessive reliance on oil, most of it exported to China to repay loans advanced as the country rebuilt after a 27-year civil war.

That war ended in 2002, opening the way for Chinese investment in the country. Former president Jose Eduardo dos Santos invited Beijing to invest in Angola after Western governments declined to help with reconstruction.

Angola and Chinese lenders pioneered the concept of oil-backed loans to access Chinese funding to build infrastructure, in what came to be known as the “Angola model”. It was successful until oil prices fell, forcing the country to pump more oil to service its debts.