Angolan state bags US$82m from privatization of government owned breweries, agro-livestock farms

ANGOLA – The government of Angola has raised a total of Akz 52 billion (US$82.7m) from the privatization of 3 state-owned breweries and 5 agro-livestock enterprises, under the Privatization Program (PROPRIV), coordinated by the Institute of Assets Management and State Participation (IGAPE).

IGAPE was created to manage the state’s financial assets and holdings, and carry out the privatisation and restructuring programme of the corporate public sector, according to a presidential order.

The PROPRIV program is aligned with the National Development Program 2018-2022 and falls within the scope of Public Finance Reform, with a view to promoting macroeconomic stability.

It also aims at increasing productivity and achieving a more equitable distribution of income.

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In this perspective, the reduction of the State’s participation in the economy as a direct producer of goods and services and the promotion of favorable conditions for private initiative, foreign investment and the acquisition of specific knowledge and skills are the guiding lines of the restructuring and resizing of the Public Business Sector (SEP).

Under the new sale, the state sold its stake in Cuca, Ngola and Eka breweries to BIH Angola Group, who plans to invest millions of dollars in the factories, to boost production and create more jobs, reports novo jornal.

The other offloaded agricultural farms include Cuimba (Bié), Longa (Cuando Cu-bango), Pungo Andongo (Malanje), Quizenga (Cuanza-Norte) and Sanza Pombo (Uíge).

“The main objective of the State is to decrease participation in the economy, increase the presence of the private sector, as well as promote increase of employment opportunities.”

Namibia Secretary of State for Finance and Treasury – Ottoniel dos Santos

The new owner of Pungo Andongo farm, PRUMO – Empreendimentos e Construção Materials bought the asset for Akz 16 billion (US$25.4m) and plans to rehabilitate the farm, targeting to harvest 15,000 tons of soy and 30,000 of corn in six years’ time.

The group estimates that this year it will produce 2,000 tons of soy and 4,000 tons of corn and plans to invest around US$15 million over the next four years, reports Jornal de Angola.

The Pungo Andongo farm has an area of 23, 230 hectares, a silo with a storage capacity of 33,000 tons and equipment for the production of manure, corn and animal feed.

Government champions private investment

According to the Secretary of State for Finance and Treasury, Ottoniel dos Santos, the PROPRIV program represents a step towards the diversification and growth of the national economy.

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“The main objective of the State is to decrease participation in the economy, increase the presence of the private sector, as well as promote increase of employment opportunities.

“The Government also foresees with the dynamization of Propriv, the possibility of investment recovery and reduce the weight that these public businesses have on the State,” said Ottoniel.

He further appealed to national and foreign investors to participate in the tenders that are taking place, as well as those that will be launched soon, which include assets in the Hospitality and Tourism, financial and Telecommunications sectors.

The privatization program aims to drop 172 assets, and particular 100 state-owned companies and subsidiaries by the end of this year.

So far, according to IGAPE data, 33 units from different sectors have already been privatized and generated revenue of Akz 355 billion (US$565m).

“If last year, even with the pandemic, we managed to alienate 33 companies, we believe that this year we will be able to achieve our goals.

“We will see if the pandemic gives us truce that does not affect in any way the direct contact with investors but we will continue to work to attract investors, mainly foreigners,” stressed the chairman of the Board of Directors, of IGAPE, Patrício Vilar.

Meanwhile, a new vegetable oil factory, with the capacity to produce 3,000 liters per month is set to commence operations in the second quarter of this year in Luanda.

Representing an investment of US$350,000 by Bassangol Limited, the facility aims to reduce reliance on edible oil imports.

According to the owner of the venture, Khalil Mohamad, currently they are undertaking assembly of equipment acquired from abroad, but the raw material will be sourced locally.

Bassangol is a multi-sectorial company that undertakes production of tilapia, poultry feed, tomato paste manufacturing, marmalade processing, among other activities.

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