Luanda, Sept. 25, 2024 (Lusa) - Angola's minister of mineral resources, oil and gas said on Wednesday that the country's fuel price is the "main variable" leading to smuggling, advocating an increase to bring it into line with neighbouring countries. ‘The main variable in fuel smuggling is the price between us and neighbouring countries. This is a major motivation for smuggling. This is the main variable because if we eliminate this variable, what will be the point of smuggling?’ said Diamantino Azevedo, speaking today in Luanda at the opening of a training seminar for journalists on the language of the hydrocarbon sector. The minister said that if the price charged in Angola were equal to or similar to that charged in the Democratic Republic of Congo (DRCongo), a country that shares an extensive land and river border with Angola, the ‘business [of smuggling] would no longer be profitable’.
‘[But] it's not that easy. We made the first attempt [with the latest removal of fuel subsidies], but that's the short, medium or long-term solution. We should at least have an average price, just like in the region,’ he said at the meeting organised by his ministry in partnership with the Association of Economic Journalists of Angola.
The problem of fuel smuggling in Angola led to the drafting of a specific law and the recent creation of a multi-sectoral commission headed by the minister of state and head of the military house of the President of the Republic. This followed a visit by Angolan President João Lourenço to the province of Zaire, a border country with the DRCongo, where the governor presented the "drama" of smuggling.
Authorities have identified members of the law enforcement and security forces, businesspeople, and former government officials as being allegedly involved in fuel smuggling, which, according to the Angolan government, has caused ‘enormous damage’ to the country's socio-economic fabric.
Diamantino Azevedo contextualised the goals and challenges of the sector he heads, especially during President João Lourenço's term in office. He highlighted the reforms that began with the creation of the National Oil, Gas and Biofuels Agency (ANPG)—the national concessionaire—and the Oil Derivatives Regulatory Institute (IRDP).
The ANPG regulates prospecting, and the IRDP the refining and distribution segment.
‘This was a fundamental change that many people didn't want. Many of us Angolans fought against [the creation of these institutions],’ he emphasised, considering that “the biggest corruption phenomena [in Angola] come from oil”.
‘And it also comes partly from the system we had of oil governance,’ he noted.
In his hour-and-a-half speech, the minister also pointed out that the country, with a daily production of one million barrels of oil, is declining due to the exhaustion of reserves and a lack of investment.
He said that the bidding strategy for oil blocks, the sector's modernisation, the legislation passed and the institutions created in the last seven years should help combat the current decline.
The minister also challenged state-owned Sonangol to expand its national share of oil production, noting that it operates only 2% of all the oil produced in Angola and is challenged to increase this to 10%.
‘We are challenging Sonangol because 2% is irrelevant (...). We must have more Angolan companies in the oil sector,’ concluded Diamantino Azevedo.
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