Angola Infrastructure Report Q2 2010

The latest quarter saw activity in Angola'sthe 2010 games, from which impetus for overall
construction sector reach its peak on the back ofinfrastructure development is spilling over into
the Africa Cup of Nations 2010 games. Although,subsequent years. Outside the hydrocarbon
held in January, the games are still providing amarkets, Angola's push to modernise its airports
momentum for infrastructure projects and willcontinues to drive its construction sector. A series
push growth in the sector to 22.71% in 2010.of airports across the country saw progress in
Angola attracted international attention thisdevelopment in the latest quarter, while little or no
quarter, as it hosted the 2010 games as well asactivity was seen in the road, rail and port
the latest OPEC meeting, and both exemplifiedsub-sectors. As this spill-over subsides beyond
contradictions in a country that has become one2010, growth in Angola's construction sector will
of Africa's leading oil exporters. The games helpeddrop in 2011 and ease y-o-y thereafter. BMI
boost construction and tourism in Angola, whileexpects growth to decelerate sharply to 13.55%
the fatal attack on the Togolese team in Cabindain 2011, from 22.71% in 2010.
demonstrated the continuing security risk in theThe growth of the country's construction industry
country and marred its business environment.and wider infrastructure sector has been partly
Meanwhile, Angola's first-time hosting of the OPEChinging on negotiations with the IMF, which has
meeting illustrated the country's increasingallowed consideration of infrastructure spending as
importance as an oil producer but also highlightedit approved a US$1.4bn loan in November 2009.
its lack of compliance with calledfor productionNews of the loan came shortly before the
cuts, partly as a result of its dependence on oilgovernment announced its aim to pay debt owed
revenue for infrastructure development. In anyto construction firms beginning in 2010 after at
case, Angola is set to continue as one ofleast a year of deferred payments. While oil
Sub-Saharan Africa's growth areas. Buildingoutput is set to rise in the next several years, the
materials company Pretoria Portland Cementcountry moves sluggishly towards becoming an
(PPC), the continent's largest cement producer,electricity exporter and, although hydropower
saw increased demand from Angola betweenprovides around 70% of the country's total
October and December 2009, compared with theelectricity supply, this source is still
same period in the previous year. WhiPC expectsunderdeveloped. After expansion in Angola's
regional demand to drop in 2010, withconstruction industry drops sharply in 2011
improvement expected in the following year, BMIcompared to 2010, BMI expects the rate of
sees Angola's construction sector growing togrowth to hover just above the 11% mark in
US$4.03bn in 2010.2012 and 2013, before easing again to 10.89% in
Much of this growth is a result of preparation for2014 when the sector will be worth US$9.86bn.