Angola Plans Sell-Off of Some State-Owned Firms

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qualityAngola, the fifth-largest diamond producer in the world, plans to sell about 33 state-owned companies over the next five years, said Economy Minister AbrahaoGourgel cited by Bloomberg News.

It is not clear whether state-owned diamond company Endiama EP would be among the 90 government-run businesses that could be sold, but it appears unlikely from comments Gourgel made.

“The [civil] war, a limited internal market and the lack of capacity of those who bought state companies in the past meant only a few successes in areas like beer and light industry,” Gourgel said. “The new strategy is to sell non-essential companies, reduce their costs and the amount of government subsidies.”

Companies likely to be sold include mostly small and medium-sized enterprises, he said. Gourgel didn’t say how much the sales are expected to raise.

The government will probably retain its stakes in mining companies because they need the state’s financial backing to start large-scale projects, he said.

Endiama is Angola’s largest mining company, which owns around 50 percent of most projects.

The government is “going slow” on implementing new rules for public-private partnerships after approving a new law last year, Gourgel said. Some senior members expressed skepticism on what the government could achieve, citing disappointing results for similar arrangements in Portugal and the U.K, he said.

Angola’s annual sales of rough goods are around $1.2 billion.

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