Development: Angola set to pay $6,8bn owed to foreign firms Tuesday July, 20, 2010
According to Dos Santos, Angola would pay debts to medium and small building firms in full in about two months and 40%of arrears to big building firms later this year. "The rest of the payment will be made in one or two years," he told journalists. Though, the total debts, mostly incurred from reconstruction after a civil war that ended in 2002, are much higher than previous estimates of between $2-billion and $4-billion, analysts believe the oil producer would have no problem settling the arrears. "Higher oil prices and exports will help Angola pay the building firms although the amount now is much higher than our estimates," said Alves da Rocha, an economics professor at Luanda's Catholic University. Dos Santos said 30% of the arrears belongs to Portuguese construction firms. Brazilian firms are also owed large sums. Brazil's Odebrecht, the biggest builder in Angola, has halved its 27,000-strong workforce in the nation, according to the country's largest union CGSILA. Camargo Correia, another Brazilian firm, is said to have left Angola. Portuguese firms operating in Angola include Mota Engil, Soares da Costa and Teixeira Duarte. Portugal lent Luanda €500-million in March to start paying the bills on the understanding that the debts would be settled the following month. The building debts have also been a source of tension between the International Monetary Fund and the Angolan government. Angola, which rivals Nigeria as Africa's biggest oil producer, began delaying payments to firms after the global economic recession triggered a slump in oil prices last year. |
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