A girl stands beside a laundry line in a poor neighborhood overlooking Cabinda, a heavily guarded territory that accounts for half of Angola’s oil output. (Nichole Sobecki/For The Washington Post
LUANDA, Angola —
As the price of oil rose earlier this decade, this capital city did as
well. Glass skyscrapers soared above the rubble of a 27-year civil war.
American pop stars such as Mariah Carey were flown in to play private
concerts. Luanda would become, its government announced, “a new Dubai.”
But
as oil prices have crashed, the impact on one of Africa’s richest and
most unequal countries has been devastating. The same officials who
boasted of Luanda’s sparkling ascent are asking for billions of dollars
in loans. Thousands of people are dying of preventable illnesses, and the nation’s hospitals are out of medicine. A bag of rice can now cost five times what it did a year ago.
On
a continent where natural resources have driven generations of boom and
bust, Angola has a remarkable and frightening distinction. It is more
dependent on commodity exports than just about any other nation in
sub-Saharan Africa. It is now paying for that reliance in tragic ways.
This
isn’t the only country suffering since the price of oil fell from more
than $100 per barrel in 2014 to less than $30 last year, reaching
roughly $40 recently. Venezuela is also struggling with shortages of food. Nigeria has been rocked by its biggest economic crisis in decades. But Angola’s descent has been largely hidden from the world, since visas are rarely granted to journalists.
Cranes punctuate the skyline of downtown Luanda, where much of the capital city’s wealth is concentrated. (Nichole Sobecki/For The Washington Post)
A poor neighborhood overlooking oil-rich Cabinda. (Nichole Sobecki/For The Washington Post)
At
Luanda’s Cajueiros Hospital, the oil crisis has morphed into a health
emergency. The hospital, like most in Angola, has run out of needles,
surgical gloves and almost all medication. The only way patients get
treatment is if they or their relatives buy those items on the black
market. Most Angolans can’t afford them. In recent weeks, there were no
HIV tests or tuberculosis vaccines available anywhere, according to
Angolan and international health workers.
After the government slashed its budget
by 53 percent last year, the country did not purchase a single dose of
malaria medication. In the first three months of 2016, Angola had
roughly 1.3 million cases of the disease. At least 3,000 people have
died, according to the World Health Organization.
“Now,
when you go to any ministry and ask for something, the answer is the
same: ‘We don’t have the money,’ ” said Francisco Songne, the top UNICEF
representative in Angola.
The economic crisis alone doesn’t explain the country’s alarming public-health mess. Angola’s government has long been riddled with corruption and
plagued by mismanagement. The country has the world’s highest child
mortality rate, with 1 in 6 children dying before age 5, according to
UNICEF officials.
Thanks to soaring oil prices and production,
the country’s economy grew at an astonishing average of 17 percent per
year from 2004 to 2008. By 2014, Angola had the third-highest GDP in
sub-Saharan Africa, after Nigeria and South Africa. But wealth became
increasingly concentrated in the hands of a few, mostly people close to
the political elite.
Even when the economic downturn occurred,
that elite was spending lavishly. In December, one of the country’s
largest mobile-phone companies, Unitel, paid American rapper Nicki Minaj a
reported $2 million to perform in Luanda. Unitel’s chief executive at
the time was Isabel dos Santos, daughter of the Angolan president, José
Eduardo dos Santos, who has been in office since 1979. In June, Isabel
dos Santos — Africa’s first female billionaire — was appointed head of the state oil company.
On
a recent day, Christina Da Silva waited outside Cajueiros Hospital to
deliver surgical gloves, needles and medicine for her husband, who had
contracted malaria. She and her relatives had managed to pool enough
money to pay for the $10 pills, an almost impossible price in a country
where half of workers earn less than $2 a day. Before the crisis, the
medication was free in public hospitals.
“You borrow from your
family. You borrow from your friends. You get the money however you
can,” Da Silva said. “If you don’t get it, he dies.”
People relax beside the pool at the luxurious Epic Sana hotel, located beside the de Beers building, a 13-story high-rise in the capital. (Nichole Sobecki/For The Washington Post)
A
mother braids her daughter’s hair in a poor neighborhood overlooking
Cabinda, a heavily guarded territory that accounts for half the oil
output from Africa’s top petroleum producer. While the World Bank lists
Angola as an upper-middle income country, vast inequality means that
life expectancy remains only 53 years, and child and maternal mortality
rates are among the highest in the world. (Nichole Sobecki/For The
Washington Post)
The country’s few outspoken activists
and independent journalists have long protested the stark inequalities
in this oil-rich nation. How, they asked, could Luanda have a bustling
Porsche dealership and apartments renting at $20,000 per month, and such
a vast population of poor people?
Now, those same activists face a frightening question: What will it look like if things get worse?
“Even
during the war, we didn’t have this many people dying,” said Rafael
Marques de Morais, a critic of the government and the founder of Maka
Angola, a watchdog organization, referring to the conflict that ended in 2002.
The crash in oil prices has led to a rapid fall
in the flow of U.S. dollars into Angola and a sharp decline in the
value of the local currency, the kwanza. That means soaring prices in a
country where many basic goods are imported.
It’s not just goods
that are imported. Because Angola lacks professionals, it has for years
brought in foreign engineers, doctors and teachers to work here. Now it
is scrambling to pay them. Last year, hundreds of Cuban doctors
threatened to leave the country because they had not been paid in
months. The salary dispute was largely resolved, Cuba’s ambassador to
Angola told Luanda’s Opais newspaper.
Musicians play for a packed crowd at the Miami Beach club, owned by the daughter of the president of Angola and wealthiest woman in Africa Isabel dos Santos. A sharp decline in international oil prices has hit the economy hard in Angola, one of the world’s most unequal countries, and stirred resentment toward President José Eduardo dos Santos, the leader of Africa’s largest crude exporter. (Nichole Sobecki/For The Washington Post)
For years, Angola has been one of the world’s most expensive countries
for expatriates, as oil swelled the value of the currency. Their
lifestyles became the stuff of lore — like the story of a Frenchman who
paid $100 for a melon at a store and later unsuccessfully sued the
seller for profiteering. But for locals earning kwanza, it has never
been harder to afford food or medicine, with a devalued currency and
slashed welfare programs. Their living conditions have deteriorated in
sometimes deadly ways.
One jarring example is an outbreak of
yellow fever, the world’s largest in decades. The epidemic has been
blamed in part on the government’s refusal to pay for garbage collection
in some parts of Luanda because of its shrunken budget. The trash,
along with pools of rainwater, attracted swarms of mosquitoes, which
carry the deadly disease. So far, there have been more than 3,000 suspected cases and about 350 deaths.
“This was entirely preventable,” said UNICEF’s Songne.
Angola’s
15-year economic boom has made it more difficult for the country to
receive international aid; it is now classified by the World Bank as an “upper middle income” country.
“Humanitarian
agencies cut their development budget under the assumption that Angola
is a middle-income country that can deliver public services,” said Alex
Vines, the Africa director at Chatham House, a British think tank. “But
the country doesn’t care about the poor in that way.”
Before the economic crisis, Angola’s government had laid out plans for diversification, setting up a sovereign wealth fund,
or a state-owned investment fund. That fund, with a $5 billion
endowment and managed by the president’s son, José Filomeno dos Santos,
had begun investing in hotels, infrastructure, health care and mining across Africa.
Dos
Santos, in an interview, emphasized the fund’s role in helping to
“shift focus from the extractive industry and to invest in other sectors
that could make the domestic economy more sustainable.”
In June,
Angola made a loan request to the International Monetary Fund, which
agreed in principle to loan the country $4.5 billion. But in late June,
the Angolan government abruptly withdrew its request, and the loan was
never extended.
“We haven’t seen this sustained
oil-price decrease for some time,” said Cobus de Hart, a senior
economist at NKC African Economics, a South Africa-based research firm.
“That’s what is making it so much more challenging this time — this is a
country that failed to diversify its economy, and now it is suffering.”
Correction: An earlier version of this report incorrectly stated that the IMF had extended a $4.5 billion loan to Angola. The loan was never extended.
https://www.washingtonpost.com/world/africa/an-oil-boom-made-it-the-most-expensive-city-in-the-world-now-its-in-crisis/2016/08/02/adf777e8-31c2-11e6-ab9d-1da2b0f24f93_story.html
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