adminTrade Focus
Allan Majuru
The thriving Angolan economy and a growing middle class with rising disposable incomes, coupled with good political relations between Harare and Luanda, presents export opportunities for Zimbabwean businesses.
Angola, a fellow member of the Southern Africa Development Community (Sadc), has a population of around 30 million, according to the World Bank.
Its gross domestic product (GDP) currently stands at US$110,2 billion, which translates to a GDP per capita of US$3 666.
Angola imports most of its consumer goods and utilities from countries such as Portugal, Brazil, China and South Africa.
These countries have established their own niche markets which, to some extent, are difficult to penetrate.
However, given Zimbabwe’s capacity to produce high-quality products, there is scope to penetrate Angola’s market and increase exports into the country.
To enable local companies to take advantage of these opportunities, ZimTrade — the national trade development and promotion organisation — will conduct a market survey in Namibia and Angola in November this year.
This market survey will identify strategic avenues for local companies to supply the Angolan market with several products in sectors such as processed foods, agriculture and clothing.
Fast-moving consumer goods
Currently, in Angola, there is high demand for imported products in fast-moving consumer goods such as meat and processed foods.
The market is aware of good quality products from Zimbabwe, and this can be used as a basis to introduce new products and increase distribution of existing product lines.
There is scope to export meat (chevron and beef), which is in high demand.
However, regional countries that are currently supplying Angola are failing to meet demand.
According to Trade Map, the top five meat exporters to Angola in 2018 were United States of America, Brazil, Portugal, Belgium and Argentina.
Local producers can leverage on Zimbabwe’s proximity to Angola and existing trade agreements to increase meat exports.
There is scope to focus on value addition of specific products such as chicken and pork, which can perform well in the market.
Further, there is potential to increase processed foods such as tinned foods, fruit juices and cordials.
These value-added products will position local producers to potentially earn more value from their exports and at the same time increase job creation and economic activities in Zimbabwe.
Dairy products have huge potential as reflected by the price difference between retail prices on the local market and in Angolan shops.
Currently, Angola imports these, including long-life full cream milk and yoghurts, from countries such as South Africa and Portugal.
Products with potential in the FMCG sector also include poultry and table eggs.
In terms of poultry, baby chickens are in high demand, as well as ordinary chicken.
The poultry business in the Southern African country has been affected by stockfeed shortages, among others, which presents additional opportunities for local firms.
Established retail chains such as Shoprite can be conduits through which local products, particularly FMCGs, can be introduced and distributed in Angola.
Agriculture and horticultural produce
Agricultural production is minimal in Angola and their local produce accounts for less than 15 percent of what is available in their supermarkets.
Fresh produce such as vegetables and fruits have a ready market in Angola, and local suppliers can aim to meet certification requirements that will make market penetration easier.
One of the key focus areas for the Angolan government is investing in agricultural production and processing to diversify the economy and avoid over-reliance on oil and food imports.
Growth in the agricultural sector is causing rising demand for agricultural implements.
Local exporters can target specific agro-based solutions such as plant and equipment, as well as chemicals.
There is demand for farm implements, especially ox-drawn implements, in the northern parts of the country.
In addition, the agricultural sector presents opportunities for exporting technical skills.
Zimbabwe has a wide range of skill competences in areas such as horticulture, agronomy, veterinary services and crop sciences.
Clothing and protective clothing
There are two distinct clothing markets in Angola: the lower end mainly dominated by the Chinese and second-hand clothing, and the upmarket segment supported by Brazilian, Italian and Portuguese fashion.
Angolans have a strong affinity to both the Portuguese and Brazilian fashion trends, and products in this segment are often expensive.
The upmarket segment is dominated by well-known exclusive suppliers such as Hugo Boss, Lacoste and Pierre Cardin, who also stock internationally.
However, Zimbabwean suppliers can compete with niche products in the upmarket segment.
Previously, the use of protective clothing, particularly by small businesses, was not common in Angola, as there were no regulations that made this mandatory.
But, the changing regulatory framework is creating opportunities for local suppliers of protective clothing.
Demand for the protective clothing is unsurprisingly growing.
Construction supplies
Angola is currently undertaking various infrastructure development programmes that include road construction, housing and industrial development.
The country has a diverse natural resource endowment to support the projects.
The availability of raw materials for the production of cement provides an opportunity for cement processing.
Overall, industrial, commercial and infrastructural development in most parts of Luanda makes it possible to actively participate in the actual construction, including material and product supplies.
In particular, the construction industry offers opportunities such as brick making, cement processing, sub-contracting construction engineering services, construction steel supplies and painting services.
Human capital
The official business language in Angola is Portuguese, which arguably gives room for English teachers and translators.
English is perhaps the largest business language used in the world and this presents an opportunity for teachers with the requisite expertise to tap into the Angola market.
There are a few English-speaking schools in the country, hence scope for private tutorship from Zimbabweans and Zambians.
In addition, there is strong demand for electricians, quantity surveyors, electronic engineers, plumbers and other services.
Allan Majuru is ZimTrade’s chief executive officer.
Tinaye Agere
Online Reporter