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Russia and Angola: Cooperating On Trade, Arms Delivery and Natural Resource Exploration

By Kester Kenn Klomegah

Russia is ready to raise its full-fledged bilateral ties and strengthen multifaceted cooperation by signing a series of agreements with Angola, one of Russia’s key partners in the African region, during the meeting scheduled early April between President Vladimir Putin and Angolan counterpart Joao Manuel Goncalves Lourenco in the Kremlin, Moscow.

Putin has expressed his confidence that Joao Lourenco official visit marks a new stage in the development of bilateral relations between the two countries. Putin has had bilateral connectivity with this southern African country, for example, during the leadership of Jose Eduardo Dos Santos who visited in October 2006.

Russia-Angolan relations have been developing actively “on the principles of mutual respect, trust and sincere friendship.” It is worth saying that Russia and Angola successfully cooperate in resolving actual international and regional problems and in ensuring security, law and order in the world.

In July 2018, Vladimir Putin held a meeting with President of Angola Joao Lourenco on the sidelines of the BRICS Summit. “Russia and Angola have longstanding and friendly relations that we greatly treasure. We are actively cooperating in political matters, security, and at international organizations. Our trade is quite modest so far, but in general, we have good projects that can be implemented. Our military and technical cooperation is also developing,” Putin told his Angolan Joao Lourenco.

During the Cold War, Russia always supported the Angolan people and helped achieve what is now treasure most of all: independence. Even after independence, Angola has enjoyed political freedom for 42 years, Russia never turned its back on Angola; it always supported and helped us fight the apartheid regime, which was a threat to Angola and the entire African continent.

“Rest assured that the people of Angola will never forget the friendship between our countries that was forged in battle. Now, we are focused on development. We want our country to develop in all areas. Speaking about economic cooperation, we are counting on interaction with Russia. First of all, Russian enterprises work in our mining complex. But, we would also like Russian businesses to be represented in other industries,” Joao Lourenco, in his turn, told Putin.

Russia plans large-scale economic engagement with Angola. Last year February, during a working meeting between Vladimir Putin and Alrosa CEO Sergei Ivanov in Kremlin, it came out that Russia’s Alrosa plans to develop one of the largest diamond deposits, Luaxe in Angola. “We are currently conducting a feasibility study. We have met with the President of Angola. Everything is on schedule. I am certain it will be a significant asset that will help us maintain our leadership,” according to Sergei Ivanov.

Soon, the truth in his words comes to fruition. In March 2019, Joao Lourenco gave an exclusive interview to a Russian media, Itar-TASS, he outlined some of his plans. The Angolan leader hinted that his country was ready to undertake the building factories to manufacture Russian weapons and military equipment for the African market.

“As for our military and technical cooperation with Russia – it will continue and be deepened. We would like to evolve from our current state of purchasers of Russian military equipment and technologies towards becoming the manufacturers and having an assembly point of Russian military equipment in our country,” he told the news agency.

Russia and Angola have military and technical cooperation. In 2018, Russia agreed to supply arms and military equipment to Angola worth US$2.5 billion, including spare parts for the Soviet-made weaponry, light weapons, ammunition, tanks, artillery and multi-purpose helicopters.

Besides, there are a number of Russia companies interested in Angola. For example, Mazepin’s companies considers an important step building nitrogen fertilizer plant in Angola. Zarubezhneft, an intermediary for the state interests in the field of fuel and energy complex on the international arena, plans to work in the oil and gas industry – from exploration and field construction to the pipeline systems construction and supply of equipment to the oil facilities.

Zarubezhneft has sealed a memorandum of understanding with Angola’s authorities to cooperate when exploring and producing from crude oil fields of that African country. For this purpose, the consortium eyes the Atlantic shelf of Angola, expecting to produce from it in partnership with Angola’s Sonangol and Dark Oil Company, which licenses for the area.

On the other hand, it was also reported in March 2017 that Angola had given two Russian companies the green light to build a major refinery complex and railroad. The US$12bn mega project put forward by companies Rail Standard Service and Fortland Consulting Company, which have set up a consortium with local partners.

Gustavo Plácido Dos Santos, Researcher at the Portuguese Institute of International Relations and Security (IPRIS), wrote recently that Angola has been on the frontline of Russia’s expansion in sub-Saharan Africa. Luanda enjoys strong historical ties with Moscow. Although political ties have failed to translate into deeper commercial interactions, it is worth highlighting Angola’s potential for Russian companies, especially in terms of mineral resources.

According to him, Sub-Saharan Africa is set to produce more gas than Russia by 2040. Thus, the region becomes a viable alternative for the European Union’s aim of diversifying energy sources away from Russia. In this sense, given the geographic proximity, countries such as Nigeria would be in the front line to satisfy Europe’s diversification goals. However, instability in Nigeria and its neighborhood positions Angola — one of Africa’s most stable energy producers — as a viable alternative.

Interesting to recall that back in June 2009, Dmitry Medvedev and Jose Eduardo dos Santos also held bilateral talks. A joint communique issued following the talks sets out the priority areas for developing the partnership between the two countries. The sectors in question include mining, energy, transport, telecommunications, military-technical cooperation, health and education.

Both leaders then witnessed the signing of a number of bilateral agreements, in particular, an intergovernmental agreement on air transport links, an agreement on encouragement and mutual protection of investment, and the medium-term program for economic and trade, science and technology as well as agreements on cooperation in geology and higher professional education.

In addition, there was a contract signed for the building and financing of Angola’s national satellite communications and broadcasting system, AngoSat. Energiya corporation reaffirmed its intention to fulfill the contract that envisions creation of a satellite network for telecommunication and broadcasting in Angola.

This April, some of the large-scale economic and investment projects crystallized in the documents signed covering projects in energy, minerals exploration, and high technology, in particular building a satellite communications system, and that of economic cooperation to a new level. There are the desires and the possibilities, but the need to reflect on setting up new financial mechanisms, according to South African based Senior Analyst on African policy, Kelvin Dewey Stubborn.

In his discussion for this article, Dewey Stubborn acknowledged that there are various forms of cooperation two largest state-owned companies, Zarubezhneft and Sonangol. There are a number of projects to develop and find new hydrocarbon deposits. This is certainly of interest because of very big players in the oil market, but this does not mean that Russians cannot cooperate in this field. Regarding the overall situation, Africa is a continent developing very dynamically, a continent on the rise, and second, Africa today has powerful countries that have chosen their own development paths.

Experts, such as Professors Vladimir Shubin and Alexandra Archangelskaya, Institute for African Studies in Moscow, have also argued that “both Angola and Russia still need to be more strategic in aligning their interests, and more proactive in carving out efficient bilateral instruments and mechanisms in order to promote economic exchanges and reap the benefits of a fully-fledged partnership.”

According to Wikipedia, compared to the Soviet era, trade between Russia and Angola is still minimal. In 2016, exports from Russia to Angola amounted to US$567.9 million and Angolan exports to Russia amounted to just US$14.94.

Angola has diamonds, oil, gold, copper and a rich wildlife, forest and fossil fuels. Since independence, oil and diamonds have been the most important economic resource. The Republic of Angola is a country in south-central Africa, the seventh largest by territorial size and bordered by Namibia to the south, Democratic Republic of Congo to the north and Zambia to the east, and on the west the Pacific Ocean.

Kester Kenn Klomegah writes frequently about Russia, Africa and the BRICS.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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