FACTBOX-Key political risks to watch in Angola

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The ruling MPLA’s December Central Committee meeting will be closely watched after media reports suggested long-serving President Jose Eduardo dos Santos had chosen a successor and may step down before or one year after a 2012 general election.

The weekly Novo Jornal said in September dos Santos had selected Manuel Vicente, head of state oil company Sonangol, as his successor, but a party spokesman said no decisions had been taken and the party would appoint its candidate in December.

Meanwhile, several anti-government protests organised this year show Angolan youths are ready to air their grievances about human rights, social conditions and high unemployment but also that the authorities are willing to respond with force, Reuters reports.

On the economic front, technical problems in oil production have led the government to slash its growth forecast for this year, highlighting the need to diversify the economy.

SUCCESSION GUESSING

Dos Santos strengthened his 32-year grip on power with last year’s new constitution, but the MPLA’s decision not to quash talk about a succession signals that for the first time he may be considering a handover of power.

According to the constitution, the number one in the electoral list that wins a general election becomes president.

With the main opposition UNITA party in disarray due to an internal leadership dispute, the MPLA is favourite to win the 2012 election, meaning its list of candidates to be presented in December may signal whether a succession is planned.

If dos Santos is still selected to lead the party in the election, placing Vicente second in the list could mean the president wants to guarantee an electoral win and hand over power in a controlled manner later.

Analysts say Vicente would not represent a significant change in policies as he is already in the president’s inner circle, with many saying dos Santos is likely to remain in the background as a guarantor of stability.

Local commentators say, however, that the MPLA’s political bureau may be against selecting Vicente as the next leader, urging the president to choose someone younger and with a military background, such as former party secretary Joao Lourenco or Bornito de Sousa.

Watch out for:
— Comments from dos Santos, MPLA before December meeting
— Any comments on who will succeed Vicente at Sonangol

YOUTHS VOICING PROTESTS

Two anti-government rallies in September showed that a putative youth movement has not been deterred from protests and that the government is ready to clamp down on any dissent.

The first rally in the capital, Luanda, resulted in 24 arrests and injuries to protesters, journalists and police officers during violent clashes.

A court swiftly sentenced 18 of the protesters to up to three months in jail, drawing criticism from opposition parties and international human rights organisations. A second rally calling for the arrested to be released was blocked by police moments after it started.

The protesters notched a victory when a high court overturned the convictions in October. Two days later police blocked hundreds of youths from protesting in Luanda once again.

Inspired by uprisings in north Africa, the pro-democracy rallies have upset the MPLA, which has responded with pro-government demonstrations. Senior party figures have also accused the opposition of planning “a national insurrection”.

Watch out for:
— Plans for more rallies, police reaction

POLITICAL BICKERING AHEAD OF ELECTION

The 2012 poll will be only the second after the end of a 27-year civil war that pitted the Russian- and Cuban-backed MPLA against UNITA, supported by the United States and apartheid South Africa.

The MPLA, which won the war in 2002 and 82 percent of the vote in a 2008 general election, is likely to win the 2012 election, especially as UNITA, now the main opposition party, is embroiled in an internal dispute.

Senior UNITA figures in July demanded the resignation of party chief Isaias Samakuva, saying he had prevented the party from choosing its own leader freely. He responded by suspending 12 of the dissenting members for 45 days and promising a party conference in December.

The internal struggle has not stopped UNITA from raising tensions with the MPLA, which it accuses of stripping the national election committee of power and transferring control of logistics to the government.
— Next steps in UNITA internal dispute
— Rising tension in parliament ahead of election

TRANSPARENCY

Dos Santos’ government has long been accused of mismanaging oil revenues, avoiding public scrutiny and doing too little to fight graft in a country which watchdog Transparency International ranks as the 11th most-corrupt in the world.

Other organisations have urged the government to cut the huge influence of state oil company Sonangol, calling for an independent agency to ensure oil income trickles down to the country’s poor. An estimated two-thirds of Angola’s 16.5 million people live on less than $2 per day.

The usually tight-lipped government in April denied a report that it lost almost $6 billion in illicit capital flows in 2009 via “trade mispricing”.

Dos Santos has been unusually vocal about corruption after his government turned to the IMF for a loan in 2009, but the decision-making process remains opaque, with access to key officials limited. The private media are also seen to be controlled by members of the government.

Watch out for:
— Government delivering on pledges to fight corruption

ECONOMIC GROWTH

Lower-than-expected oil output in some fields due to technical problems forced the government last month to cut its growth forecast for this year to 3.7 percent from 7.6 percent.

However, the government expects the economy to grow 12 percent next year — a return to the fast pace enjoyed before the 2008 oil price slump — as oil fields come back on line and new projects begin production.

Most analysts agree on double-digit growth estimates for 2012, but warn that downside risks include further technical glitches and a possible drop in oil prices amid a slowing global economy.

Central bank Governor Jose de Lima Massano has been received favourably since his appointment last year, particularly for stabilizing the kwanza and cutting inflation to 11.91 percent in September from 16 percent in October 2010.

He has also introduced a benchmark interest rate to guide monetary policy, attain price stability and boost savings.

Watch out for:
— Details of 2012 budget, oil price assumptions

OIL DEPENDENCY

Oil has helped Angola pick up the pieces of a devastating civil war to become sub-Saharan Africa’s third-biggest economy after South Africa and Nigeria.

Despite moves to diversify and invest in sectors such as agriculture, oil still accounts for 90 percent of Angola’s export income but employs less than 1 percent of its people.

The IMF and rating agencies have warned that Angola is still too exposed to oil price fluctuations.



Should it fail to reduce its dependency on oil, it risks becoming another Nigeria, where quarrels about the distribution of wealth have fuelled civil unrest.