`Terminator' Lourenco Proves He's No One's Puppet in Angola

(Bloomberg) -- Shortly after becoming president of Angola in September, Joao Lourenco did something completely unexpected: he stopped at a red light.

The incident prompted thousands of social-media users to praise the 63-year-old former army general for abiding by the law. In October, Lourenco waited in line at a KFC restaurant to buy a burger, and then this month, photos surfaced of him and his wife Ana Dias strolling on a beach in the capital, Luanda.

Few predicted the sharp contrast in leadership style with his predecessor, Jose Eduardo dos Santos, who rarely left the pink presidential palace from where he ruled Africa’s second-biggest oil producer for almost four decades. When he did emerge, hundreds of soldiers swarmed the city center to allow his convoy to move swiftly through the pot-holed streets, leaving traffic paralyzed for hours.

`Terminator' Lourenco Proves He's No One's Puppet in Angola

“He’s been a very positive surprise,” said Soren Kirk Jensen, an independent Angola expert. “There’s been a profound change of style, from a completely closed style to a completely open one. More importantly, he’s initiated much-needed economic reforms by addressing dysfunctionalities in the way the market works due to unnatural monopolies that happened to be controlled by certain families.”

When Lourenco won nomination as the candidate of the ruling Popular Movement for the Liberation of Angola last year, analysts discounted a policy shift, saying his power would be limited by the party and the Dos Santos family and its allies. Lourenco’s decision to reappoint 13 out of 18 provincial governors he had inherited from Dos Santos just two days into his new job seemed to confirm that suspicion.

Corruption Fight

But in a state of the union speech on Oct. 16, Lourenco stressed that he was serious about campaign promises to fight corruption and end state-run monopolies in a country that ranks among the world’s 20 most corrupt, according to Berlin-based Transparency International.

The first high-profile official to be removed was central bank Governor Valter Filipe, a lawyer Dos Santos appointed the previous year.

Then came the bombshells. He fired both Dos Santos’s billionaire daughter, Isabel, as chairwoman of state oil company Sonangol, and Jose Filomeno dos Santos, one of his sons, as head of Angola’s $5 billion sovereign wealth fund.

Lourenco also replaced the boards of several state-owned companies loyal to Dos Santos, and canceled multimillion dollar contracts for the management of Angola’s public television channels with two other Dos Santos children.

“The leadership change in Angola is radical,” said Nuno Borges, who heads the country’s car dealers’ association, Acetro. “People are no longer scared to speak out about corruption. There’s a lot more transparency.”

Terminator Lourenco

The dismissals have earned Lourenco the nickname “relentless remover” and comparisons to Arnold Schwarzenegger’s movie character ‘The Terminator.’

Lourenco has rejected claims that he’s targeting his predecessor’s family.

“This isn’t about chasing people,” he said on Jan. 8 to mark his first 100 days in office at a press conference that would have been unthinkable under Dos Santos. “It’s about fixing situations that were proving to be harmful to the public interest.”

Lourenco faces a tough task in turning around an economy that has been crippled by low prices for oil, its main export. Gross domestic product is forecast to expand 1.1 percent in 2017 from zero the previous year, according to the 2018 budget. That’s the worst performance since the end of a protracted civil war in 2002.

In the past four months, Angola has abandoned the kwanza currency peg to the dollar, announced the sale of stakes in state-owned companies and encouraged wealthy Angolans with money abroad to repatriate their funds.

A former secretary-general of the MPLA from 1998 to 2003, Lourenco isn’t known to have used his position to cash in on business deals. He once owned a 5.4 percent stake in the lender Banco Sol but is no longer on the list of shareholders.

‘Tacit Mandate’

“It’s not a coincidence that he had a relatively clean track record in terms of corruption,” said Jensen. “He came in with a tacit mandate from the elite to change the way of doing business, although some may have been surprised by the determination and boldness with which he has pursued it.”

Francisco Viana, head of Angola’s 200,000-member Business Confederation, said that while the recent measures will help attract investment, more needs to be done to kick-start sub-Saharan Africa’s third-biggest economy.

“We back the president, but we haven’t yet reached a point where we can let our guard down,” Viana said.

©2018 Bloomberg L.P.