Angola reviewing foreign exchange regime for oil sector investment

Angola is reviewing the foreign exchange regime for investments into its lucrative oil sector, according to Deputy Finance Minister Job Graca. He told a seminar that the country expected up to $ 20 bn in foreign investment into its oil industry over the next decade, but the broader economy would hardly receive any positive spin-offs.
"The oil companies are working in an enclave economy where they purchase almost all of their goods overseas -- economic growth therefore enjoys no multiplier effect as a result of the investments," he said. South African consultancy BusinessMap estimates that over the past five years, Angola has received almost $ 4 bn in foreign direct investment into its oil sector, with a further $ 8 bn announced.

Angola's daily oil production has quadrupled since 1980 and is expected to rise to between 1.1 mm and 1.4 mm bpd by 2003. At that rate it would soon surpass Nigeria as Africa's largest producer. However, Angola is planning to restrict oil output as part of a new strategy to make its huge oil reserves last longer.