Overview

Subsistence agriculture provides the main livelihood for most of Angola’s population, but more than half of the country’s food is still imported.  Angola holds tremendous agriculture potential with fertile soils, abundant water, and a favorable climate.  The Ministry of Agriculture estimates that Angola has almost 58 million hectares available for agricultural development, including 35 million hectares of arable land.  Of the arable land, approximately 10 percent is currently cultivated, and 20 percent is suitable for irrigation.  After almost 27 years of civil war, aggressive international landmine clearing efforts have opened up extensive areas of land for agricultural development whereby, the United States has invested more than US$ 124 million toward landmine clearance programs in Angola since 2000.  Livestock also holds strong potential in Angola, with a vast natural habitat for grazing and water resources throughout the country. 

During the Portuguese colonial era, which ended in 1975, Angola was a major producer and exporter of cotton, coffee, corn, banana, tobacco, sugar cane, and sisal.   Currently, Angola’s main agricultural crops include cassava, corn, beans, potatoes, sweet potatoes, soy, bananas, coffee, rice, vegetables and fruits.  Domestic agricultural production capacity does not meet local demand.  The most fertile regions are in the highlands and valleys.  The rainy season is from October to May, which is considered the prime season for vegetable cultivation.  Tomatoes are grown during the dry season (June to September).  Greenhouses and irrigation expand the growing seasons, but these technologies are not widely used in Angola. 

Poultry production has increased slightly over the last 3 years but was affected by a an insufficient supply of feed and chemicals as well as  long periods of drought in some Angolan provinces.  Most chicken products in the market are currently imported to meet demand.  Angola’s livestock farming is located primarily in the southern part of the country and is based on natural pasture grazing.  Beef is the second largest agricultural product after cassava.  Other livestock, such as goats, pigs and chickens are raised mainly by small-scale farmers as subsistence food sources.  The Government of Angola conducts a pilot livestock census with technical support from the Food and Agriculture Organization of the United Nations (UNFAO) and with World bank funding.  According to the Cooperative of Cattle Producers of Southern Angola (CGSA), an industry association based in Lubango, Huila Province, cattle population is approximately 3.5 million heads nationwide.

A featured element of the Angolan Government’s National Development Plan for 2018-2022 is agricultural development to diversify the economy and to build domestic food production capacity that will decrease the country’s dependence on imported food.  To support this development, the Angolan government issued the Presidential Decree PAPE (Action Plan for Employability Promotion).  The program is funded by the Angolan government’s annual budget and oil fund and designed to increase local production and create jobs.

The Angolan government has established a number of publically announced target areas for agricultural production development including:

• A comprehensive program to stimulate beef production and offset some of the 100,000 tons of beef imported annually into Angola.  Areas of focus include improving veterinary health, increasing herd production, strengthening slaughterhouse regulations, and building infrastructure capacity through government projects and credit to private entities. 

• A plan to increase corn production capacity to meet domestic demand (human and animal feed)  through a range of public and private initiatives.  Current demand is for 4,500 tons of corn, but local production is only 1,800 tons.  Corn imports primarily come from Brazil, South Africa, and Turkey.

• Increasing production at wheat milling plants already operating in Angola include the Grandes Moagens de Angola project that has the capacity to produce 1,200 tons of wheat flour per day.  The owners of the new GMA mill in Luanda started building an identical wheat mill in the port of Lobito, on Angola’s southern coast. The Kikolo wheat mill on the outskirts of Luanda, is operating with a capacity to produce 1,000 tons of wheat flour per day.  This increased capacity in wheat milling offers new opportunities for U.S. exporters of milling equipment and services. Despite the pandemic, more wheat mills were installed.

Angola’s agricultural industry consists of both private and public companies.  Private sector agriculture is expanding with several large agro-industry growers, mostly involving Portuguese, Brazilian, and Israeli investors either independently or through joint ventures with the Angolan government.   Chinese participation in Angola’s agriculture is growing, prompted by Chinese government financing, with a 1,00 hectares rice production project in the southern province of Cuando Cubango. 

The economic downturn in Angola negatively impacted the Angolan government budget, including the government’s stated support of economic diversification efforts, such as agricultural production.   The Government of Angola’s limited budget commitment falls far short of the Maputo Declaration, an agreement where all African countries agree to allocate at least 10 percent of their annual buget to revitalize the agricultural sector.   

The National Development Program budget provides for specific agricultural programs, including: Agricultural Production Development Program (US$ 192 million), Animal Production Program (US$ 37.3 million), and PRODESI -Production, Export Promotion and Import Substitution Program (US$ 89 million). 

The lack of commercial credit in the market has also made it extremely difficult for companies to import needed agricultural equipment and inputs, creating significant obstacles to private sector agriculture development.  Strong pent-up demand exists for these important imports as companies try to establish and expand their agricultural production capacity.

Angolan government credit programs for industry and agriculture exist, but are underfunded and underutilized.  For example, “Angola Invest,” a government–guaranteed and subsidized line of credit program, provides up to US$ 5 million through local banks for companies with 75 percent minimum of Angolan financial capital.  However, to date very few loans have been approved through the program, and commercial banks have complained about the lack of quality projects.  While the government’s development bank (Banco de Desenvolvimento Angolano) focuses on larger (over US$ 5 million) long-term loans to private companies investing in productive sectors such as agriculture, limited government budget allocations have restricted the program.  Furthermore, clear land title for purposes of loan collateral is reportedly a challenge for some companies and individuals in accessing financing for agricultural activities.  

To correct the inefficiency and some insuffiencies of the Angola Invest program, the Angolan president released the Decree 159/19 related to the Credit Support Project (PAC-Programa de Apoio ao Crédito).

The Credit Support Project, inserted in the Production Support, Export Diversification and Import Substitution Program (PRODESI) applies to investment projects that contribute directly or indirectly to the domestic production of goods such as sugar, rice, beef, wheat flour, beans, kassava flour, maize flour, milk, spaghetti, soybean oil, palm oil, blue soap, common salt, eggs, chicken meat, meat, pork meat, corn grain, cassava, sweet potatoes, reindeer potato, tomato, onions, garlic, carrot, pepper, cabbage, lettuce, banana, mango, pineapple, tilapia (cacusso), horse mackerel from Cunene, sardinella aurita (lambula), sardinella maderensis (reed), sunflower edible oil, peanut oil, honey, construction steel rod (greater than 8mm), cement, clinker, cement, mortar, plasters, plaster and the like, tempered, laminated, multilayered or otherwise worked glass, glass packaging for various purposes, construction paint, n​apkins, toilet paper, rolls of kitchen paper, disposable diapers, sanitary towels, solid detergent (powder), liquid detergents, bleaches, beer, juices and soft drinks, and table water.

PAC focuses on:

1. Companies or producer cooperatives involved in agriculture, livestock, fisheries and industry that already produce any of the 54 strategic goods and must be registered in the ”Portal do Produtor Nacional” and regularly make available the information its production in the information application ”Made in Angola”;

2. Companies or producer cooperatives in the fields of economic activity in agriculture, fisheries and industry that intend to start producing any of the 54 goods;

3. Companies or producer cooperatives in the fields of economic activity in agriculture, livestock, fisheries and industry that have investment projects in the field of production of any of the 54 goods, in which the state of the physical implementation of the implementation of the projects is close to completion, but its promoters need financial resources for its completion (investment projects in effort);

4. Companies or producer cooperatives in the fields of economic activity in agribusiness, fisheries and industry that have established agreements for the sale of intermediate goods, final goods and various services used in the production, logistics and distribution of any of the 54 goods;

5. Companies or producer cooperatives in the fields of economic activity in agriculture, fisheries and industry that have established purchase, logistics and distribution agreements for any of the 54 goods;

6. Companies owned by any resident national or foreign citizen, in the case of the latter, must comply with the provisions of Article 20 of Law No. 10/18, of 26 June, on Private Investment;

7. Companies or producer cooperatives in the fields of economic activity in agribusiness, fisheries and industry that have more than 3 years of economic activity, if they want financing for investment projects that expect to have an average annual turnover in the scale of a medium or large company, in accordance with the legislation in force;

8. Present investment projects with annual turnover volume with a scale of micro and small companies, in accordance with the legislation in force, for companies that are starting the first year of activity;

9. Entities which demonstrate that they have organized general accounts, regularly closed, and prove that they have regularized the payments of taxes and social security contributions, by declaring the AGT and INSS, respectively, in the cases of being companies or producer cooperatives in the branches of economic activity agribusiness, fisheries and industry with more than a year of activity;

10. Entities which demonstrate that more than 50% of the amount of raw material that will be used in the investment activity to be financed is produced in Angola and acquired from producers of raw materials located in the national territory;

11. Entities which demonstrate that more than 80percent of the labor force that will be used in the investment activity to be financed corresponding to national citizens;

12. Entities which have debt recovery plans approved by the respective creditors and certified by them the effective state of compliance, in the case of promoter companies that are in default with the payment of taxes, social security contribution, bank financing and other debts with third parties;

13. Entities which demonstrate that they have signed work contracts with exclusive dedication for the project managers to be financed, being incompatible for the main managers of the undertakings the exercise of other functions, public and/or private, regardless of whether they are holders of share capital the promoting company;

14. Entities which demonstrate that the project management team to be financed has professional experience and technical training that ensures the good management of the enterprise in question, through the presentation of the professional curriculum and the technical and / or professional knowledge certification, passed by research entities. accredited training in Angola;

15. Entities which demonstrate the suitability of the managers and owners of the capital of the beneficiary company, based on the presentation of documents on the regularity of the judicial and fiscal situation of the same and of the candidate companies.

There were 89 projects received and 13 projects approved in late 2019 among the banks participating in the program being Banco Internacional e Comercial (BIC), Banco Millennium Atlântico (BMA), Banco Comercial do Huambo (BCH), Banco Fomento Angola (BFA) and Banco Negócio Internacional (BNI), Standard Bank Angola (SBA), Banco Angolano de Investimento (BAI), Banco Comercial e Industrial (BCI), Banco de Desenvolvimento de Angola (BDA) and Fundo de Garantia de Crédito (FGC).

The Angolan government has engaged with multilateral development banks to provide loans to the private sector for the productive sector that includes agriculture, livestock, fisheries and agro-processing.

During periods of more generous budgets, the Angolan government directly supported the establishment of numerous large agricultural projects and companies.  Some of these include:

Gesterra S.A. (Arable Land Management) – An Angolan government company with 18 projects in 8 provinces throughout the country and investments of US$ 800 million for cultivation of thousands of hectares of crops including rice, maize, soy, and beans, as well as livestock, poultry and swine.  The projects, developed in partnership with private entities, are designed to reach profitability within 8 to 9 years.  Through a presidential decree Gesterra took over four agriculture project from the sovereign wealth fund in Cuando Cubango,  Moxico, Uige and Zaire provinces  to produce and process soy and corn. According to a senior manager at Gesterra, the company mission was revised to respond with actual needs where most of the above mentioned projects are subject to the Angolan government privatization program (ProPriv).

SODECAP (Capanda Agro-industrial Development Park) - An Angolan state-owned company responsible for the development of the Capanda Agro-industrial region covering 411,000 hectares in Malange province.  SODECAP has invested in the operations of Pedras Negras farm (cereals), Biocom farm (corn, sugar cane, and ethanol), and Pungo Andongo Farm (corn) as well as in smaller projects involving 186 villages (agricultural produce, sugar cane, wood, livestock, and eggs).

Aldeia Nova, an Israeli Vital Capital Fund public-private partnership with the Angolan government, consists of large scale agro-communal centers that support communities of farmers with technical support and equipment for the production, processing and distribution of products ranging from poultry and cattle to fruit, and vegetables. 

Quiminha Project (PIDARQ) – PIDARQ is an Angolan government Integrated Agricultural and Rural Development investment project, valued at $200 million, and developed by the Israeli company Tahal Group.  The 5,000 hectare project involves intensive irrigation and will include 300 family farmers with small plots as well as industrial scale private farms.  The project plans for an eventual production of 52,000 tons of agricultural produce per year.

Ongoing multilateral development bank projects include:

• Currently under development with the Angolan Government is a major World Bank “Commercial Agriculture Development Project”, which is expected to continue until May 2024.  The project development objectives are to promote commercial agriculture development and specifically to increase production and employment within selected value chains in targeted areas in Angola.  The project is divided into 3 components: agribusiness development (US$ 190 million); support to develop an enabling environment for commercial agriculture (US$ 25 million); and project management, coordination and public-private dialogue (US$ 15 million).  Texas A&M University’s Borlaug Institute conducted an agricultural assessment to assess and provide recommendations for advancing Angola’s capacities in the areas of poultry, livestock, coffee, grain crops, and value chain development to support this project.

• World Bank “Smallholder Agricultural Development and Commercialization” Project.  A second project loan was signed  to help increase smallholder agriculture productivity, production, and marketing for selected crops in the project areas.

• The African Development Bank (AfDB) agricultural-related work in Angola is focused on developing small farmer projects and linkages to agricultural value chains and commercialization.  Active AfDB agricultural projects include:  1) a study of private sector agriculture capacity in Cabinda province; 2) technical support to advance infrastructure projects along the “Lobito corridor” in order to connect the markets of the Democratic Republic of the Congo, Zambia, and Angola; and, 3) agricultural development in southern Angola related to the impact of climate change on this naturally dry area. Bilateral donors and business interests have focused more attention on Angolan agriculture. 

(total market size = total local production + imports - exports)
Units: US$ millions
Source: Source: PND, Global Trade Atlas and OANDA

Leading Sub-Sectors

Equipment for seeding, planting and harvesting grains and horticulture crops:

• Livestock production equipment and technologies
• Cold chain solutions (refrigeration/warehousing)
• Food processing equipment
• Seed varieties
• Fertilizers/compost
• Irrigation systems (pumps, pipes, etc.)
• Veterinary supplies
• Training and management services and technology

Opportunities

The principle agricultural equipment suppliers to Angola are Portuguese, Brazilian and Indian. A number of U.S. agricultural equipment and technology companies are active in Angola through distribution partners, including John Deere, Caterpillar, Massey Ferguson, Case, and New Holland.  Additional U.S. equipment in Angola is purchased and imported directly by the end user or informal resellers, who are often from South Africa.

The high priority focus on agricultural development and increasing attention from the World Bank on this sector suggests that Angola is a market to watch for U.S. agricultural equipment and supply companies in the medium-term.

Specific sub-sector areas with strongest potential include:

• Livestock – The Angolan government has established goals for increasing livestock production.  Current livestock activity is concentrated in southern Angola and is primarily based on small family farms with some existing larger producers.  Producers have told the U.S. Commercial Service they are interested in technologies for cattle raising, animal feed, veterinary services, and other solutions related to production and improving quality.

Grain and horticulture – The Angolan government’s targets for meeting domestic corn supply through local production will require substantial investments.  A number of private projects also focus on soy production.  Several large-scale government sponsored projects, such as the Quiminha Project, also focus on increasing horticulture production.  Angolan companies are in need of equipment and input solutions, to include: seeds, fertilizers, pesticides, irrigation equipment and other types of production and processing equipment, such as silos and dryers.

• Cold Chain - Strong potential also exists for U.S. exports related to cold chain infrastructure as Angola continues efforts to build its domestic food production and distribution capacity.  The Angolan government initiated PRESILD (Program for Restructuring of the Logistics and Distribution System of Products Essential to the Population) to support domestic agricultural production and distribution with a plan for infrastructure nationwide, but implementation has been slow due to budget limitations.  Ministry of Commerce regulations  require companies to separate import from retail activities and to register their cold storage facilities.

• Food Processing -  With increased production capacity, opportunities should expand for U.S. exports related to food processing equipment.  Several flour and grain milling projects are underway.  There is a high level of agriculture production lost due to the lack of access to markets and improper food handling.   Most processed foods are imported, including basic canned vegetables, which may offer opportunities for local value-added manufacturing concurrent with the expansion of agricultural production.

With the increased focus on agricultural production in Angola, many landowners are interested in establishing production, but lack the requisite experience and background in agriculture.  Therefore, demand exists for international consultants and turn-key solutions from international suppliers.  Angolan companies already active in the agriculture sector often express concern about the lack of spare parts and services available in Angola for agricultural equipment maintenance.  While some agricultural equipment distribution exists in Angola, many farmers purchase agricultural equipment through neighboring countries or buy used equipment without receiving after-sales support.  Companies that can provide quality post-sales value-added services and support are likely to be very competitive in Angola.

The Angolan government is also, based in the presidencial decree 250/19, carrying out the program for the privatization of public companies and assets/shares (ProPriv 2019-2022), including those in the agricultural sector as follows:

• Aldeia Nova SA
• Matadouro Industrial de Camabatela
• Matadouro Industrial de Porto de Amboim
• Matadouro Modular de Luanda
• Matadouro Modular de Malanje
• Fábrica de Processamento de Tomate e Banana de Caxito
• Entreposto Frigorífico de Caxito
• Fábrica de Latas do Dombe Grande
• Fábrica de Processamento de Tomate do Dombe Grande
• Entreposto Frigorifico do Dombe Grande
• Fábrica de Processamento de Tomate do Namibe
• Entreposto Frigorifico do Namibe
• Complexo de Silos da Caconda
• Complexo de Silos da Caála
• Complexo de Silos da Catabola
• Complexo de Silos Catete
• Complexo de Silos da Ganda
• Complexo de Silos da Matala
• Fazenda Quizenga
• Fazenda Pungo-Andongo
• Fazenda do Longa
• Projeto de Desenvolvimento Agrícola de Camaiangala
• Fazenda Agro-Industrial do Cuimba
• Projeto de Desenvolvimento Agrícola de Sanza Pombo

Resources

Angola Ministry of Agriculture www.minagri.gov.ao

National Development Program https://governo.gov.ao/ao/

United Nations Food and Agriculture Organization (UNFAO) https://www.fao.org/home/en/

World Bank (WB) https://www.worldbank.org/en/home

International Monetary Fund (IMF) https://www.imf.org/en/Home