Economy

Chinese Bank will Open Branch Office in Angola

The Angolan Government Authorized a Chinese Bank to Open a Branch Office in the Country

May 18th, 2016
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Last week, on the May 13, the Angolan President, José Eduardo dos Santos, signed a decree authorizing a Chinese Bank to open a branch in Angola. The document defines that the Bank will run under the name “Bank of China”, in Angola, and the aim is to develop financial activities that interest both countries.

The decision to open such an institution in Angola right now, comes at a sensitive time as the country is struggling with strong constraints due to the oil price crisis. In particular, the access to foreign exchange is really difficult now, as well as transfers to foreigner countries, and imports of raw material. Válter Filipe, the director of the Angolan National Bank, already declared that Angolan Bank is being ostracized from the world financial system, precisely because of the difficulty to access to foreign exchange through Angolan banks. The International regulators have doubts about the credibility of Angolan institutions, which makes Válter Filipe appeal for “ethic and morality”, when it comes to Angolan banking. He believes that Angolan banking should be “available for everyone”, which makes the Chinese investment an excellent piece of news.

He added also that “We should be implementing prudential standards and good practices, in Angola, on a national and international level. These standards would combat money laundering, as well as terrorism financing, because we are falling into a situation where the Angolan financial system is on the fringe of the global financial system. This is a serious issue for the prosperity of our families.”

The Bank of China was built in 1912, and worked until 1949 as a central bank. It suffered several changes over the years, while still being state-owned, but already functioning as a commercial bank, it focused its attention to supporting Chinese companies and communities overseas, especially the emerging economies.

An Angolan-Chinese financial relations are growing bigger, as the Chinese community in Angola is now about 230 000 people, and hundreds of companies. Also, in 2015, the Chinese government approved a new line of credit to the Angolan State, in the amount of 5.2 billion euros, for the working Chinese companies in the country. Then, at October 12, the Central Banks of Angola and Chine settled the details of an agreement to allow the use of national currencies (of both countries), in bilateral trades. This action will facilitate economic trades between the two countries, and strengthen up their financial bonds.

References:

Cultural Diplomacy News
Beatriz Nunes, CD News