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Angola Economic Problems and the Implementation of Socialist Policies
One of the priorities of the Neto regime after
independence was
to repair the country's infrastructure, which had been
shattered by
the liberation struggle and the civil war
(see Background to Economic Development
, ch. 3). There had been extensive
damage to
bridges, roads, and transport vehicles, and most undamaged
vehicles
had been taken out of the country by the Portuguese. With
no means
of transporting food and other essential supplies to many
areas of
the country, the distribution system collapsed.
Furthermore, a good
part of the economy disintegrated when most of the
Portuguese
settlers, including skilled workers and government and
economic
development administrators, left the country at
independence.
Perhaps more in response to the economic emergency than
as a
result of the party's long-term commitment to a planned
socialist
economy, the government created a large state sector as
stipulated
in a resolution passed during the October 1976 party
plenum
(see Role of the Government
, ch. 3). Earlier that year, the
government
allowed state intervention in the management of private
companies
that had suffered most from the Portuguese withdrawal and
passed
the Law on State Intervention in March 1976, which
provided for the
formal nationalization of private companies. As a result,
a large
part of the economy, including abandoned commercial farms,
the
mining industry, and the banking sector, became publicly
owned. The
government, however, acknowledging the massive
reconstruction task
it faced, continued to encourage and support the private
sector and
to welcome foreign investment.
The MPLA leadership gave urgent priority to the revival
of the
agricultural sector, which employed about 75 percent of
the
economically active population. But the government's
rejection of
market incentives, the massive dislocations caused by
warfare, the
disorganization of the new bureaucracy, and hostility
among the
peasants to imposed collectivization of their land doomed
most
government efforts. Once a food exporter, Angola was
forced to
import an ever-increasing amount of food.
Although the agricultural sector barely continued to
produce,
the Angolan economy survived because of the oil produced
by and
sold to Western private enterprise
(see Oil
, ch. 3). The
honest and
straightforward approach of the Angolan government toward
its
Western investors earned it the admiration of its partners
and
resulted in the inflow of capital not only in the oil
industry but
also in mining and fishing.
Data as of February 1989
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