Professional/Financial Service Opptys

An Expert's View about Banking, Finance and Insurance in Angola

Last updated: 22 Mar 2011

Angola is now one of the world’s fastest growing economies, with an average growth of over 16% in the last five years.

Sector briefing Professional and Financial Services Opportunities in Angola Why Angola? Angola is the UK?s third largest export market in Sub-Saharan Africa. Following a generation of oil dependency, the effects of the Government?s diversification policy are beginning to kick in and the non-oil sector is now growing faster than the oil sector. After three decades of civil war, most of Angola?s infrastructure was destroyed. But things are changing, fast. Essential services are not as yet adequate to meet the growing needs in many sectors, and great efforts are under way to address this. The scale of the opportunities here is such that there is room for everyone in most sectors. And in some, the UK has a competitive edge because our expertise is particularly valued. Find general information on the Angolan market conditions on UKTI?s website. The Doing Business Guide for Angola gives an overview of Angola?s economy, business culture, potential opportunities and an introduction to other relevant issue. UK Trade & Investment Sector briefing: Financial Services opportunities in Angola Opportunities This is partially explained by the over- bureaucratic nature of the industry. Ango Unlike their African counter-parts, Angolan la is now one of the world?s fastest growing economies, with an average growth of banks emerged relatively unscathed from the over global financial crisis, suffering only from the 16% in the last five years. Now emerging from the devestat knock-on effects of reduced deposits from a ion of the civil war, reconstrut slowdown in oil revenue and tighter fiscal ion and development is financed by the o policies. No bank required government bail il and gas sector, itself sustained by sign out. ificant foreign investment. After many years of po litical stability, the country now has a working constitutuion and a fledgling democracy. More sign Banking Sector ificantly, it is beginning to enter the internat ional political and commercial arenas, see Despite being in its infancy, the sector has ing itself as a key reg seen staggering growth, and now compares in ional player. size to its African neighbours. According to Ango Imara, Banco Espirito Santos de Angola (BESA) la?s economy remains heavily dependent on o one of Angola?s largest private banks, boasts a il and other extractive industries, but the goverment balance sheet of $4 bn. Other will be in excess ?s call to diversify away from the hydrocarbon sector is see of that figure ing increasing investment in agriculture; education; construct Banks dominate the Angolan financial services ion; tourism; and infrastructure. All these sector. As of 2010, there are 21 banks areas are witnessing dynamic growth, often exceed operating here, with at least three branches in ing that seen in the oil and gas economy. every provincial capital. Fewer than 6% of the population have a bank account, and less than The Banco Nacional de Ango 2.4 million of Angolans will have a bank card la (BNA) acts as the central reserve bank, by the end 2010. implementing fiscal po licy and managing currency flows. Since the end of the war The majority of foreign owned banks are it has been working on rebu Portuguese. Russian, Indian and South African ilding trust in the national currency (kwanza) and reducing inflat banks have all recently applied for banking ions (standing at 12% Q2 2010). It licences. British representation is limited to ?s Governor, José Massamo, one representative office, and two more is a member of the Government. looking to set up. Since be ing privatised in 1999, the financial services sector has been sub Bank credit to the private sector has grown ject to a series of reforms to l exponentially over the past five years, fuelled iberalise the previously tightly state-contro by the demand by the construction industry. lled financial system, specifically the banking and This is expected to continue, with the insurance sectors. Both these development of hotels, housing and office industries now have regulatory and supervisory procedures. accommodation The main opportun The majority of banking activity focuses on ies within the financial services sector l commission related business, eg. currency ie in banking, insurance and pr trading and trade finance. But banks are ivate investment. The iminent opening of the beginning to offer a more diverse range of stock exchange is sure to draw products, including car loans and mortgages. international attention. And due to the comp Very few business apply for loans. lex legislative framework surrounding the sector, legal advice services are also on the verge of a boom. Insurance With The insurance sector was liberalised in 1999, the exception of insurance products, the penetration of the sector in the popu with revenues mostly derived from the oil lation is unsurpr sector. The sector is governed by the Instituto isingly low. Fewer than 25% of Ango de Supervisao e Seguros. Today there are five lans have access to financial services. insurance companies, the largest outside the UK Trade & Investment Sector briefing: Financial Services opportunities in Angola oil sector is GA Angola Seguros (GA). Seven companies have applied for broking Compulsory car insurance was introduced in licences. 2010, becoming most Angolans consumption of financial services products. AAA, created by the The majority of listings will be banks. However national oil company Sonangol, remains there are a number of other Angolan effectively the only insurer in the oil sector. companies who would qualify, including beer But the key emerging sector for insurers is the and food manufacturers, telecoms and developing retail and corporate sectors. construction. An active stock market will undoubtedly open Microfinance up the sector to foreign institutions. There are currently only two microfinance OUTLOOK institutions in Angola registered with the BNA. Aligned with the government?s diversification ?Legislative changes and development in the drive, bankers are beginning to extend credit sector are expected to widen availability of to individuals and small companies, particularly credit in agriculture and small-base manufacturing. ?New land law will reduce confusion over The Angolan Bankers Association state that property rights and make mortgages more over 40,000 families have been supported in attractive the last five years in setting up farming ?Opening of stock exchange will further projects. liberalise banking sector ?Changes in foreign exchange rules will demand an increase in banking capacity Legal services POTENTIAL Legal and professional services firms are underreprested in Angola. The legal Massive investment in infrastructure and framework is fragmented and bureaucratic, redevelopment will require private funding if and expert advice is needed to support the government is to live up to its companies negotiate the complex and time- commitments to continue to modernise both consuming system. There are a handful of the country and its fiscal policies. Increased British firms, and a growing number of diversification of the economy opens up Portuguese, but the sector is a long way from additional opportunities. But this looks all the saturation point. more attractive when set against a backdrop of a fuel-driven economy, a stable government PPP/PFI and increasing international engagement. The government has committed to privatising a number of companies in all sectors, particularly in transport, infrastructure and manufacturing. If you have any questions of the opportunites They are strongly in favour of PPP/PFI, and above, contact eh UKTI contacts names in this often quote the UK models. Private investors report. Business opportunites aimed are frequently sought to fund massive specifically at UK companies are added daily to developments under PPP or PFI. An example UKTI?s website. These leads are sourced by of this is the new masterplan for the re- our staff overseas in British Embassies, High development of Luanda. But there are more Commissions and consulates, across all sectors coming online soon, including the new port to and in over 100 markets. the south of Luanda and and airport. Stock Exchange You can be alerted to business opportunities on a regular basis by registering on the UKTI The Stock Exchange is due to open in 2011, website. Find out more on UKTI?s business having been delayed several times due to the opportunities service on the UKTI website global financial crisis. 40 companies are expected to be listed, and there are claims that it will be the third largest exchange in sub- Saharan Africa, by market capitalisation. UK Trade & Investment Sector briefing: Financial Services opportunities in Angola Major events and activities UKTI contacts Karen Neal FILDA ? International Trade Fair British Embassy Luanda www.fil-angola.co.ao Tel: (00244) 222 334 582 Contact: David Anca Email: karen.neal@fco.gov.uk Email: david.anca@fco.gov.uk www.uktradeinvest.gov.uk Time: July 2011 David Ança Lord Mayor's delegation to Angola British Embassy Luanda City of London website Tel: (00244) 222 334 582 Contact: Mansion House Email: David.anca@fco.gov.uk Email: lmvisits@cityoflondon.gov.uk www.uktradeinvest.gov.uk Time: September 2011 Find full details of all events in this country and sector on the UKTI website. New export events are added daily to the site and you can register to be alerted to them on a daily, weekly or monthly basis UKTI?s Tradeshow Access Programme (TAP) provides grant support for eligible Small & Medium Sized Enterprises (SME's) to attend trade shows overseas. Find out more about UKTI support for attendance at overseas events UK Trade & Investment Sector briefing: Financial Services opportunities in Angola Next steps - How UKTI can help ? Arranging appointments British companies wishing to develop their ? Organise seminars or other events for business in the Angola market are advised to you to meet contacts and promote your undertake as much market research and company in the Chinese market planning as possible in the UK. UKTI?s team in Angola, with its wide local knowledge and This work is available via our Overseas Market experience, can provide a range of services to Introduction Service (OMIS) a chargeable British-based companies wishing to grow their service which assists British-based companies business in global markets. wishing to enter or expand their business in overseas markets. This can include: ? Provision of market information To find out more about commissioning this ? Validated lists of agents/distributors work, or accessing other UKTI services and ? Key market players or potential specialist advice, please visit the UKTI website customers in the Chinese market to find contact details for your local UKTI ? Establishment of interest of such office. contacts in working with you Whereas every effort has been made to ensure that the information given in this document is accurate, neither UK Trade & Investment nor its parent Departments (the Department for Business, Innovation & Skills, and the Foreign & Commonwealth Office), accept liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Published 2010 by UK Trade & Investment. Crown Copyright © UK Trade & Investment Sector briefing: Financial Services opportunities in Angola
Posted: 22 March 2011, last updated 22 March 2011

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