Русский
With the US President Joe Biden on an eye-brow raising diplomatic trip to Angola, we examine the Russian position with the same country and look at where there may be similarities.
Angola has generally held a neutral position toward Russia over the years, yet the country is also highly self-interested which means that Angola would not cooperate with Russia if its commercial assets are threatened by Western sanctions. Luanda has expressed dissatisfaction with Russia’s position as concerns Ukraine – one reason for Biden’s visit as he looks to shore up African support for US policies in Africa.
However, Angola is also seen by Moscow as a potential West African gateway for establishing closer regional political and economic relations. In the Kremlin’s view, Angola’s importance is underscored by its ports, which could serve Russia’s critical military and commercial purposes in the Atlantic Ocean. These ties fit into Russia’s broader strategy of engaging with African nations, especially with the overall trade and political move to the Global South and Africa’s general underlying dislike of older European colonial influences. However, at present much needs to be done to persuade Luanda that Moscow would be a preferable trade partner and with Biden’s visit this now appears unlikely.
Consequently, the current level of bilateral trade and investments falls far behind the levels of Russia’s trade with other African countries. The reason is two-fold: one is geographic distance and the other is Western sanctions imposed on Russia by the West, and principally Europe.
That has been further exacerbated by Russia’s diamond mining giant Alrosa, having to sell its equity stake last month in Angola’s Catoca mine, the fourth-largest in the world. Also sold were Alrosa’s shares in Angola’s Luele mine, which it held in partnership with the Angola’s state-owned Endiama. The buyers were an Omani-backed fund, with Russia ‘encouraged’ to exit its Angolan investments due to what Angola’s Minister of Mineral Resources and Petroleum referred to as “a block on the commercialization of diamonds” from these resources. Biden’s visit in part was a thank you.
There have been other Russian trade investments in Angola, including trade cooperation in agricultural products, where it was suggested, at the 2023 Russia-Africa Forum, which Angola attended, that Russia’s grain exports to Angola could grow to US$100 million over time. Russia is also interested in expanding ties with Angola in coffee processing.
In 2021, Russia’s trade turnover with Angola amounted to just US$90 million, but this has subsequently decreased to about US$20 million for 2024.
Sanctions continue to dominate Russia-Angola relations. The only bank in Africa with Russian participation is the VTB Africa Bank, with VTB Russia holding a 50.1% equity stake. VTB Africa has been under sanctions since 2014 and was disconnected from SWIFT in 2022. Excluded from international services, the bank has been deprived access to dollars and euros, and its branches have been unable to conduct international transactions now for two years. The situation has stifled business. Present in Angola since 2006, the bank has 3,700 customers, including 440 businesses, according to its latest report published in March 2023. Most of its private clients are in the mining and diamond sector. VTB are now seeking to fully exit, and will take an African development haircut in doing so. Another win for Biden, although it is doubtful Putin will lose any sleep over it.
Longer term, Russia’s woes in Angola will not make a great deal of difference to its overall development in Africa, while in terms of the diamond industry, it has already moved on – to cooperation with other African partners. Angola appears to be heading towards a Western development strategy, while Russia has developed its supply chains east – as have numerous other African nations – on Africa’s northern and eastern coasts. Angola’s need to remain Western focused is therefore geographic, rather than intensely political.
Yet even amongst these difficulties, Russia still has a partially open door. In October 2022, the Angolan telecommunications spacecraft Angosat-2, created by Russia’s Roscosmos, was launched into orbit. There remains potential within Angola’s oil industry for example. Angola does not process oil on its own and only has two oil refineries, covering just 25% of the country’s needs. That has led to discussions with several Russian oil processing, petroleum product discussions, although Biden will have wanted to head off Russian potential in this area too.
Angola’s main immediate problem may however be the incoming US President. Trump is not especially fond of Africa and does not prioritise its trade nor development. The Angolan President, Joao Lourenco, may yet want to come knocking on Moscow’s doors again should Trump decide not to follow through with Biden’s overtures.
Further Reading
The Russia-Africa Partnership Forum: Ministerial Level Conference
