Ready for business

German companies are positive about the recent reforms in Angola and are willing to invest in renewables for domestic energy supply. Germany’s Ambassador to Angola, Dirk Lölke, talks to Africa Energy Series – Angola, about Germany’s activity in the country.

With the recent changes and movement in the oil and gas sector, what interest do you see for German companies to invest in Angola?

The restructuring of Sonangol and the ongoing reforms in the oil and gas sector will make Angola more attractive for international investment. Regarding the interest of German companies in the oil and gas sector, I see particular potential for long term Liquefied Natural Gas supply arrangements. When it comes to oil, however, I think the scope for investment from Germany is rather limited. Renewable energies certainly offer a more attractive prospect for German companies.

A delegation of German parliamentary representatives visited Angola at the beginning of February 2019. What is the general opinion of the changing business climate in Angola?

German companies are generally positive about the recent economic reforms in Angola. Access to foreign currency, the possibility of paying dividends to shareholders and transparency are key issues for all international companies. There is a widespread feeling that there have been positive developments in this regard. Obviously, an important factor for the business climate will also be the general development of the Angolan economy. After a period of recession, the economy slowly seems to be recovering. Overall, I am confident about the opportunities and long-term perspectives of the Angolan market.

Germany is at the forefront of renewable energy. Angola seems to be refocusing its attention on growing its hydrocarbons sector. Do you see space for both? Where can German companies help and invest?

The German government is indeed very keen on encouraging the implementation of renewable energy. We are convinced that renewables are not only essential for curbing global warming, but also offer great business opportunities. German companies offer a broad range of innovative renewable energy solutions. I am glad that some of them already contributed substantially to the implementation of hydropower energy in Angola. I also see opportunities for small and decentralized solar energy and hydropower plants. To a certain degree, investment into wind energy also looks promising, at least in the Southwest of the country. In my opinion, there is no discrepancy between the Angolan government’s efforts to make its oil and gas sector more competitive and the government’s objective of increasing the country’s level of electrification through renewable energies.

Oil will remain Angola’s most important export commodity for quite some time but for the domestic energy supply, renewables can also be of great importance. They are particularly well suited to replacing diesel generators and to installing off-grid energy supply in remote areas. In view of this big potential, it is in the mutual interest of Germany and Angola to intensify their business cooperation in the energy sector. There is a working group exclusively on energy as part of our bilateral Angolan-German Commission for political cooperation. The last working group meeting took place at the Foreign Office in Berlin this April with a Delegation from Angola, headed by Minister Borges, who also participated in the Berlin Energy Transition Dialogue Conference in Berlin, one of the most important energy conferences worldwide.

Africa Energy Series – Angola 2019 is a comprehensive report on one of Africa’s most developed and complex oil and gas industries. It highlights the major reforms the country’s oil and gas sector has undergone, which seek to significantly increase the country’s competitiveness, and focuses on Angola’s upstream, downstream, midstream and power sectors.

The book is launching soon.