Angola's Dos Santos Family Under Pressure to Give Up Key Posts
(Bloomberg) -- The children of former Angolan President Jose Eduardo dos Santos are facing increasing pressure to step down from key posts, two months after the first leadership change in Africa’s second-biggest oil producer in almost four decades.
Since replacing Dos Santos at the helm of Angola in September, Joao Lourenco, 63, has fired the governor of the central bank, the head of diamond company Endiama and the boards of all three state-owned media companies. The string of dismissals has earned Lourenco the nickname “relentless remover.”
Now, the two most prominent children of the Dos Santos clan have come under fire for acting as barriers to reforms because of the huge sway they hold over sub-Saharan Africa’s third-biggest economy. Dos Santos’ eldest daughter, Isabel, 44, is Africa’s richest woman and chairwoman of state oil company Sonangol, in a country where crude accounts for more than 90 percent of exports. Her brother, Jose Filomeno, 39, is the head of Angola’s $5 billion sovereign wealth fund.
“They’re clearly under a lot of pressure to step down,” Gary van Staden, an analyst at NKC African Economics in Paarl, South Africa, said by phone. “Whether Lourenco aims to clean up the place or simply make it cosy for himself, the Dos Santos family is always going to be in the line of fire because of the key positions they hold in Angola.”
When Lourenco became president many thought he would become a puppet to the 75-year-old Dos Santos, who ruled Angola for 38 years and remains the head of the ruling Popular Movement for the Liberation of Angola party.
Yet, the 63-year-old former army general has signaled he is nobody’s marionette. In his state of the union speech on Oct. 16, Lourenco vowed to fight corruption and end monopolies in the cement sector. Isabel’s husband, Sindika Dokolo, is the chairman of one of the biggest cement factories in Angola.
Lourenco also appointed Carlos Saturnino, who was fired from Sonangol by Dos Santos last year, as his secretary of state for oil, putting him in charge of a 30-day review of the industry.
Isabel dos Santos, whose term at the helm of Sonangol ends in 2020, said in an interview on Oct. 19 that work to turnaround the oil company may not finish under her watch. She was not immediately available for comment.
The question now is whether Lourenco can push through new rules to open up an economy until now dominated by the Dos Santos family and its allies. Angola is struggling to recover from a drop in crude prices and the impact of a civil war that ended in 2002. After expanding for 14 consecutive years, the economy posted zero growth last year in a country where more than a third of the population of 27 million lives on less than $2 a day, according to the World Bank.
“The country can’t wait for better days,” Lourenco said in a speech on Nov. 11. Recent changes at the central bank and other state-owned companies were designed to increase control of government bodies that may be “decisive during this difficult moment in the economy,” he said.
Apart from her job at Sonangol, Isabel dos Santos also controls Unitel, Angola’s largest mobile-phone company. She owns Candando, a supermarket chain, has stakes in Angolan lenders Banco BIC and BFA and several companies in Portugal. Her brother, Jose Filomeno, has also come under fire for the way he has managed Angola’s sovereign wealth fund.
Swiss newspaper Le Matin Dimanche reported on Nov. 5 that the wealth fund’s asset manager, Jean Claude Bastos de Morais, was a friend of Jose Filomeno and has been convicted in Switzerland for misappropriation of funds.
The report, based on the so-called Paradise Papers, also said most of the fund’s money was transferred to offshore accounts in Mauritius and some of it was used to pay companies controlled by Bastos de Morais for projects in Angola. The wealth fund, known as FSDEA, denied the allegations in an emailed statement and said all of its operations are legitimate.
The state-owned Jornal de Angola newspaper ran a story on the report and Radio Nacional de Angola, the government broadcaster, provided details about the article and the denial of any wrongdoing. Angola’s main opposition party on Nov. 10 called for a parliamentary inquiry into the management of the fund.
“In the past, a story like this would only appear in the social media,” said Precioso Domingos, a professor of economics at the Catholic University in the capital, Luanda. “But pressure to put an end to some of the interests of the Dos Santos family is so great that these stories are now being picked up by the state media.”
©2017 Bloomberg L.P.