ANIP NEWS

FILDA 2005

FILDA, Angola’s largest trade fair, will take place July 11-17 in Luanda. This is the 22nd edition of the annual event, which draws participants from around the world.

Spotlight on Cabinda Province

Angola’s northern Cabinda province is world-famous for its vast petroleum resources, but the province offers many other attractions for investors beyond the oil sector. For example, did you know that Cabinda is home to one of the largest rainforests in all of Africa? The Maiombe Rainforest covers a vast expanse of land and is often described as "the Amazon of Africa." The Maiombe is home to a wide array of plant and animal species and is especially famous for its hundreds of species of butterflies, many of them unique to the area. The rainforest also offers a vast supply of tropical hardwoods, including rare varieties of mahogany. The area supplies over 200,000 meters of timber a year for Angola's construction industry. The province also boasts large deposits of gold, diamonds, uranium and phosphates.

In order to promote investment in the area, the Angolan government is committed to rehabilitating the Cabinda port, and developing a Special Duty Free Zone that will reduce the cost of goods in the province. A feasibility study outlining options for the Cabinda port was completed recently by US-based Goodworks International and its findings were presented to local authorities this month. (See separate article below for more information on the feasibility study’s conclusions.) In addition, ANIP will offer fiscal and/or customs incentives to investors in Cabinda in the following areas:

• agriculture and animal-breeding;
• industrial processing;
• fishing and fish-processing;
• civil construction;
• health and education;
• road, railroad, port, airport, telecommu-nications, energy and water infrastructure;
• heavy cargo and passenger equipment;

Investments in Cabinda are eligible for customs duties exemptions for three years. Profits on investments in Cabinda are exempt from industrial taxes for eight years, and companies that promote capital investments in the province are exempt from paying capital gains taxes for five years.

Other useful facts about Cabinda:
Governor: Mr José Aníbal Lopes Rocha
Population: 300,000
Territory: 2,811 square miles, with more then 60 miles of coastline
Climate: Temperate, with average temperatures between 75º and 85º Fahrenheit year-round and abundant rainfall.
Major Agricultural Products: Timber, coffee, cocoa, rubber and palm oil
Travel to Cabinda: Both Sonair and TAAG offer daily, one-hour flights from Luanda to the Cabinda airport and to the Malongo oil facility.

Feasibility Study on the Cabinda Port Completed

Goodworks International and Lockwood Greene Engineers presented the findings of a feasibility study on the Cabinda port to officials this week. The study evaluated the options for upgrading the existing Cabinda port to make it suitable for large-sized vessels.

The study found that the port’s navigation canal is too shallow and would need to be dredged to increase its water depth in order for the port to sustain any sizable international trade. The study concluded that the cost of dredging would be prohibitively high, and a more economical solution would be to build a new deepwater port in an area with greater natural depths and easier navigation paths.

One of the many options presented was to locate the new deepwater port at the village of Caio, whose coastal zone is more amenable to deepwater vessels and has the added advantage of being located near the Malongo oil facility. The existing Cabinda port could be converted to a fishing boat port, thus stimulating investment in the fishing industry in the area.

The proposed cost for the new commercial port would be nearly $290 million, but the study projects that the port would ultimately generate annual revenues of $150 million. The proposed new port would take 3-5 years to complete and would have a depth of 15 meters, a maneuvering basin of 356 meters, and an external canal with a depth of 16 meters. The port would occupy 81 hectares of land that would hold administrative and maintenance offices, warehouses, and mooring wharf.

South Korea Invests in Cotton Project in Kwanza Sul Province

Angola’s Ministry of Agriculture and Rural Development signed a $31.4 million loan agreement with South Korea’s Export Import Bank to re-launch cotton production in Kwanza Sul province. The investment will fund the construction of irrigation infrastructure for a 5,000 hectare area in the coastal province and provide technical assistance to cotton producers. The five-year project will begin in Kwanza Sul, but is expected to extend to other traditional cotton producing areas in Malange, Bengo and Benguela provinces and will ultimately employ about 10,000 families. The loan has a repayment term of 30 years, along with a 10-year grace period.

Bié Province to Receive $4.5 Million in Assistance from FAS

Angola’s Social Assistance Fund (FAS) will invest $4.5 million in social projects in the central province of Bié over the next six months. The money will be used to build and renovate schools, health centers, water supply systems and basic sanitation services in the districts of Kunhinga, Andulo, Kuito and Chinguar.

US Public-Private Partnership to Invest $1.5 Million in Lunda Norte Province

This week, the US Agency for International Development (USAID) and diamond company Lazare Kaplan International (LKI) signed a public-private partnership agreement to support development projects in Lunda Norte province in northeastern Angola. Under the three year agreement, LKI will provide $1.5 million for improving access to health care, education and financial credit to local communities in the province.

Angolan Enterprise Program Assisting Angolan Entrepreneurs

The Angolan Enterprise Program is developing a national strategy to support the growth of Micro, Small, and Medium-sized Enterprises (MSME’s) over the next two years. The program is a partnership between the Angolan Government, the UN Development Program (UNDP), and US-based oil company Chevron Texaco to provide micro-finance, support services and incubator services to micro, small and medium sized companies to strengthen and expand Angola’s private sector. The program expects to help 38,114 MSME’s by June 2007

“Aldeia Nova” Completes 600 Homes

The Angolan government announced that the first 600 residences constructed under its “Aldeia Nova” project will be completed in July in Waku Kungu, Kwanza Sul province. “Aldeia Nova,” which means New Village, is a government initiative to provide affordable housing and communal land development to demobilized soldiers and other displaced populations. In addition to the houses and land plots, the Waku Kungu project will have 198 stables for livestock and 81 chicken houses. An industrial zone that will have silos and incubation facilities, among other commercial facilities, is also being planned for the area.

National Coffee Institute Cultivates and Distributes 9,000 Coffee Plants

The Angolan National Institute of Coffee (INCA) has cultivated some 9,000 coffee plants at its experimental station in Uige in the first half of the year. The plants will be distributed to small-scale coffee growers as part of INCA’s national strategy to re-launch coffee production at the provincial level. INCA is predicting that the cities of Uige, Songo, Negage, Kitexe, Mucaba and Maquela do Zombo will produce 1,500 tons of commercial coffee this year, as compared to the 716 tons of coffee harvested last year in the same area.

Angola Telecom Invests $10 million to Upgrade its Network

Angola Telecom announced that it is investing $10 million to repair its backbone network. Using radio waves, the telecom operator will increase its network capacity to support growing inter-provincial telecommunications traffic. The cost of the major overhaul will be financed entirely by Angola Telecom, which expects to complete phases one and two of the work by October. Repairing the backbone network is critical for the company since it has had to rely on satellite links to compensate for the destruction of the national terrestrial network as a result of years of war. Satellite links have some inherent limitations (availability of channels and higher costs, for example) and while Angola Telecom would still use some satellite links, these would be used only to complement the new terrestrial network.

The old inter-provincial networks were largely microwave networks employing analogue technology and had very limited capacity. The new equipment being installed is high-capacity digital technology. The repairs to the backbone will not only benefit Angola Telecom customers, but will also benefit other telecom operators since the network will provide increased capacity, redundancy in case of a break, and will improve the quality and reliability of domestic transmissions.

By the end of the third quarter of 2005, Angola Telecom expects that work will be completed on the installation of the land network in the main telecom route along the Luanda-Benguela corridor. This link will include 18 stations (15 of which will employ SDH technology and three of which will use PDH technology) and will provide coverage to Bengo, Benguela, Luanda and Kwanza Sul provinces. The cities of Port Amboim, Sumbe, and Biopio will have PDH connections. Along the East-West corridor, the Luanda/Ndalatando connection will comprise 11 stations and will provide coverage to Luanda, Bengo and Kwanza Norte provinces. The cities of Catete, Bom Jesus and Dondo are just some of the cities that will be within this service area. Phase two of the project will link in the Ondjiva-Xangongo corridor in Cunene province. The telecommunications center at Cacuaco will have SDH technology, high capacity connections and a total of three stations. The project will also upgrade the following connection corridors: Luanda-Soyo; Cabinda-Cacongo; Ndalatando-Malange; Ndalatando-Uige; Huambo-Kuito; Benguela-Huambo; Lubango-Benguela; Dundo-Lucapa; Ondjiva-Xangongo; and Dundo-Nzagi.

Angola Telecom is now in the final phase of the civil construction repairs on buildings, foundations, towers, and stations along the Luanda/Benguela route. Angola Telecom is also in the midst of completing a fiber optic terrestrial link along the Tombwa-Namibe-Lubango-Chibia route. The end result of this major infrastructure investment will be an integrated backbone with three main branches of provincial interconnections using fiber, radio and satellite links.

Exchange Rates

The following are the current rates of exchange for the Angolan Kwanza against major currencies:

REMINDER........REMINDER........REMINDER

INACOM Announces New Telephone Numbering Plan for Fixed Lines

On June 26, Angola’s fixed line telephone system will add three digits to the country’s telephone numbers. The current six digit customer number will now be preceded by a fixed service code, a provincial or city code and the telephone operator code. The fixed service code is 2, while each province or major city will have its own code and each telephone operator will have its own code. For an Angola Telecom telephone line in Luanda the new digits are: fixed service code (2), the code for Luanda (2), the code for the operator (2), followed by the individual subscriber’s six digit number. For international dialers, Angola’s country code remains +244 and would precede the fixed service code.

Other provincial/city codes are as follows:

Using the new numbering system, ANIP’s telephone number will change from
+244 2 33 29 56 to +244 2 2 2 33 29 56.