An overview – Two good news for the Angolan economy: Abolition of the Business Permit and the materialisation of privatizations

It is encouraging the effort that the Angolan authorities are making to liberalize the economy and make it competitive in the middle of the storm that hit the world, with serious consequences for Angola.

A first measure announced is of particular importance for the creation of a favourable and stimulating business environment in Angola.

ABOLITION OF COMMERCIAL PERMIT AND STATISTICAL REGISTRATION

According to information made public, within the scope of measures to simplify business bureaucracy and to deal with the economic slowdown eventually caused by Covid 19, the Government “intends to revoke the procedure for issuing the business license for all economic activities and the obligation of companies to carry out statistical registration in the act of incorporation.” Of course, some exclusions from this free regime are foreseen, such as those related to the trade in foodstuffs, live plant species, animals, birds and fishing, medicines, car sales, fuels, lubricants and chemicals.

Apparently, apart from these sectors, the need for issuing a business license by the central administration is canceled.

This step, and as long as it is not replaced by another, is very important and has a clear relevance.

Do not forget that, according to the World Bank Report “Doing Business 2020”, which analyzes the position of countries in the world regarding the ease of doing business and generating wealth, Angola ranks 177th out of 190 nations. Consequently, at the end of the list.

It is clear that there is an urgent need to facilitate business and entrepreneurial initiative in Angola, so it is imperative that the State promotes the business environment in the country. One of the problems detected by the World Bank Report was the delay between 14 and 45 days to obtain a permit from the Ministry of Commerce to start business activities in Angola. This requirement would have a historical justification linked to the industrial conditioning policies of the Portuguese Salazar colonial regime, carried on by the Soviet leaderships that prevailed in the 1970s and 1980s. However, at present, the existence of Licences is an obstacle to internal free trade and country empowerment business education.

For this reason, we must emphasize and applaud this decision to abolish the need for commercial permits.

As for the statistical registration, it is now carried out with the tax identification number. Another positive simplification measure.

A second positive fact to note is the continuation of the privatization process, despite the shutdown of activities derived from Covid 19.

ACCOMPLISHED PRIVATIZATIONS

Seven entities belonging to the Angolan state have recently been privatized. This was the Camaiangala Agro-industrial Farm, located in the province of Moxico, with an area of ​​19 thousand hectares, with a grain processing factory and a structure for livestock; the Longa (Cuando Cubango), Cuimba (Zaire) and Sanza Pombo (Uíge) and Modular Slaughterhouses in Luanda, Camabatela and Porto Amboim, the Catete Silos Complex, the Caxito Cold Warehouse and from the Caxito Tomato and Banana Processing Factory.

In the case of small or medium-sized structures, the important thing, in addition to the revenue brought to the State, is that these sales demonstrate the Government’s commitment to proceed with the privatization process in a crescendo until reaching the large Angolan companies and Blue Chips. This procedure allows to test the multiple privatization processes and methods in smaller series, refining the administrative and decision-making machinery in order to accelerating privatizations.

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The relevance to be retained from this information is the Government’s strong commitment to pursue a policy of effective market implementation, promotion of entrepreneurship and privatization. Thus, the country will lay down the roots for the structural success of the economy in the medium term.