Abstract

This paper examines Angola’s economic and political status in relation to South Africa, arguing that bilateral relations have evolved from a historical dynamic of competitive regional hegemony to a contemporary strategic partnership focused on mutual economic diversification and continental leadership. Drawing on recent economic data, diplomatic communiqués, and regional security developments through February 2026, the analysis demonstrates how Angola’s post-oil transition strategy increasingly aligns with South Africa’s own development priorities, creating unprecedented opportunities for cooperation while revealing persistent structural challenges. The paper contends that Angola’s status in South Africa is best understood through three interconnected dimensions: as an economic partner for diversification, as a diplomatic ally in continental governance, and as a crucial security interlocutor in Southern African stability architecture.

Keywords: Angola-South Africa relations, regional integration, economic diversification, African Union, Southern African security

Introduction

The relationship between Angola and South Africa occupies a distinctive position in the architecture of Southern African international relations. As the two most industrialized economies in the region—South Africa possessing the continent’s most diversified economic base and Angola holding substantial hydrocarbon and mineral wealth—their bilateral dynamic has historically oscillated between competitive coexistence and cautious cooperation. This paper investigates a central research question: What is Angola’s current economic and political status in relation to South Africa, and how has this relationship evolved in the context of Angola’s post-oil transition and South Africa’s own development challenges?

The significance of this inquiry extends beyond bilateral diplomacy. Angola and South Africa together constitute an economic and political axis that substantially influences regional integration trajectories, continental governance frameworks, and Southern African security architecture. Understanding their contemporary relationship provides analytical leverage for assessing broader patterns of regional cooperation and competition in Africa’s southern subregion.

This paper proceeds in five sections. Following this introduction, Section Two examines Angola’s domestic political economy, establishing the foundational context for its external relations. Section Three analyzes bilateral economic relations, focusing on trade patterns, investment flows, and emerging sectoral cooperation. Section Four investigates political and diplomatic alignment, particularly Angola’s continental leadership role and its intersection with South African foreign policy objectives. Section Five addresses security cooperation, notably Angola’s mediating role in Eastern Congo and implications for regional stability. The conclusion synthesizes these findings and offers prospective analysis.

1. Angola’s Domestic Political Economy: The Foundation of Regional Status

Angola’s external status in relation to South Africa cannot be understood without first examining its domestic political and economic trajectory. Since President João Lourenço’s accession to power in 2017, Angola has pursued a dual transition: economic diversification away from hydrocarbon dependence and political reform amid persistent authoritarian legacies.

1.1 Macroeconomic Stabilization and Persistent Vulnerabilities

The Angolan economy demonstrated remarkable recovery in 2024, recording real GDP growth of 4.4 percent, substantially exceeding expectations and rebounding from 1.1 percent growth in 2023 . This performance was driven by both robust oil production and revitalized non-oil sector activities, including agriculture, fisheries, diamond extraction, and energy . The current account surplus rose to 5.4 percent of GDP, while gross international reserves increased to $15.8 billion, equivalent to 7.7 months of import cover .

However, this recovery masks underlying structural vulnerabilities that condition Angola’s regional bargaining position. The fiscal position deteriorated significantly in early 2025, reflecting lower oil prices and production challenges, with the overall fiscal deficit projected to widen to 2.8 percent of GDP in 2025 from 1.0 percent in 2024 . The public debt-to-GDP ratio, while declining from 72.4 percent in 2023 to 59.9 percent in 2024, is projected to rise again to 62.4 percent in 2025 .

The International Monetary Fund’s September 2025 Post-Financing Assessment characterized Angola’s capacity to repay as “adequate but subject to risks,” noting that risks had increased since the previous year due to sizable external debt service, increased volatility in oil prices, and weaker outlook for fiscal and external balances . This assessment was reinforced by S&P Global Ratings’ February 2026 decision to maintain Angola’s sovereign rating at ‘B-‘ with stable outlook, citing the country’s vulnerability to market conditions and large financing needs .

These macroeconomic indicators establish important parameters for Angola’s bilateral relationship with South Africa. While Angola possesses substantial resource wealth and demonstrated economic resilience, its fiscal space remains constrained by oil revenue dependence and debt service obligations that consumed approximately 67 percent of revenues in 2025 . This limits Angola’s capacity for ambitious external investment while simultaneously creating incentives for partnerships that can advance economic diversification.

1.2 Reform Trajectory and Structural Transformation

The Angolan government has pursued substantial reform efforts with implications for regional economic integration. On the revenue side, reforms between 2023 and 2025 include a new Customs Tariff, amendments to the VAT and personal income tax regimes, and a new Legal Regime of Invoices . These measures, part of a broader strategy to streamline the tax system and support economic diversification, have begun yielding results as the share of total revenue to GDP increased from 16.9 percent in 2023 to 17.4 percent in 2024 .

Public financial management has also seen significant improvements. The inaugural publication of the Medium-Term Expenditure Framework occurred in June 2025 for implementation with the 2026 State Budget . Financial control systems have been strengthened through the rollout of the Integrated Financial Management Information System and steps to modernize treasury accounts . Budget execution rates improved from 73 percent in 2023 to 78 percent in 2024, with social sectors achieving 93 percent execution .

Particularly significant for regional economic integration is the gradual removal of fuel subsidies. Savings from subsidy reform in 2025 are estimated at 1.4 percentage points of GDP, with fuel subsidy expenditure falling from 2.7 percent of GDP in 2024 to 1.3 percent in 2025 . While this reform provoked social unrest in mid-2025, it represents a structural adjustment that aligns Angola’s economy more closely with regional pricing mechanisms and reduces distortions in cross-border trade.

1.3 Political Dynamics and Democratic Consolidation

Angola’s political trajectory presents a more complicated picture. The ruling MPLA, in power since independence in 1975, has faced eroding electoral support, losing approximately 10 percent of the vote in each national election since 2008 . In 2022, UNITA officially won the capital Luanda for the first time, striking at the foundations of the MPLA’s political dominance given that approximately 40 percent of Angola’s urban population resides in the capital, which generates and absorbs the vast majority of the country’s economic and financial resources .

The promised decentralization reform, constitutionally mandated and long anticipated, has faced repeated postponement. Opposition and civil society groups have denounced what they characterize as deliberate delay tactics, including a 2025 administrative restructuring that more than doubled local government units while potentially ensuring that any future local governments remain relatively weak . This centralization dynamic conditions Angola’s engagement with South Africa, as foreign policy decision-making remains concentrated in the executive with limited subnational or legislative input.

The July 2025 protests, sparked by fuel price increases and leaving approximately thirty dead with hundreds arrested, revealed the precarious social conditions underlying macroeconomic stabilization . With nearly half of Angolans living on less than $3.65 per day, the social cushion for reform remains limited . These domestic political pressures influence Angola’s external positioning, creating incentives for foreign policy successes that can bolster domestic legitimacy.

2. Bilateral Economic Relations: Partnership for Diversification

Economic relations between Angola and South Africa have intensified substantially, driven by complementary diversification strategies and the institutional framework of the African Continental Free Trade Area.

2.1 Trade and Investment Patterns

South African companies maintain a significant presence in Angola, particularly in mining, banking, logistics, and services sectors . This business presence contributes to strengthening regional value chains and increasing economic competitiveness between the two countries . The February 2026 African Union Summit provided an opportunity for Presidents Lourenço and Ramaphosa to examine the state of bilateral cooperation, with both countries committed to strengthening cooperation to achieve a real “qualitative leap” in bilateral relations .

The new phase of partnership focuses on sectors considered key to sustainable development and regional integration: agriculture, energy, mining, transport, and higher education . This sectoral focus reflects mutual recognition that bilateral trade must move beyond traditional extractive industries toward more diversified and employment-generating activities.

A concrete illustration of deepening business ties occurred in July 2025, when more than eighty South African businesspeople conducted a tour of the provinces of Huambo, Benguela, Bié, and Huíla . Rashid Toefy, Deputy Director-General for Economic Development and Tourism of the Western Cape Provincial Government, emphasized that the visit aimed “above all, to honor the vision of an African partnership focused on sustainable progress” . The delegation included businesspeople from the Cape region with interests in agriculture, energy, construction, mining, tourism, and manufacturing .

2.2 Energy Sector Cooperation

Energy cooperation constitutes a particularly significant dimension of bilateral economic relations. The partnership between Angola’s state oil company Sonangol and South Africa’s Petroleum, Oil and Gas Corporation (PetroSA) reflects common interest in deepening partnerships in the oil area and developing joint projects . This collaboration aims to enhance sustainable exploitation of natural resources while promoting technical and technological knowledge transfer .

The strategic importance of this cooperation extends beyond bilateral benefit. As Southern Africa confronts energy security challenges, coordinated hydrocarbon development between Africa’s second-largest oil producer and the region’s most industrialized economy offers potential for addressing structural energy deficits while reducing dependence on extra-regional sources.

2.3 Mining Sector Strategic Alignment

Perhaps the most striking recent development in bilateral economic relations involves coordinated positioning regarding De Beers, the global diamond giant. Angola is pursuing a 20-30 percent stake in Anglo American’s diamond unit, a proposal being discussed with other diamond-producing African nations including Botswana, Namibia, and South Africa .

Paulo Tanganha, Angola’s National Director of Mineral Resources, articulated the cooperative logic: “There is a saying: together we are stronger. That’s the way we are doing it. And if my neighbour is suffering, I also suffer. So we have to be together and fight together as a team” . This statement reflects a significant evolution in regional resource diplomacy, from competitive extraction toward coordinated positioning in global value chains.

The closed-door discussions among Botswana, Angola, Namibia, and South Africa seeking common position on De Beers stake acquisition represent an unprecedented effort at regional coordination in the diamond sector . For Angola, state-owned diamond miner Endiama and national diamond trading company Sodiam would take up any stake on behalf of the government .

2.4 Diversification Performance and Challenges

Despite these cooperative initiatives, Angola’s economic diversification indicators reveal persistent challenges. The Global Economic Diversification Index for 2026 places Angola at 80.51 on the PCA Average, substantially below South Africa’s 103.26 and below regional peers including Botswana (95.07), Namibia (93.65), and Mauritius (99.01) . Angola’s output sub-index of 66.75 and trade sub-index of 76.70 indicate particular challenges in moving beyond resource extraction toward more diversified production and export structures .

IMF projections suggest non-oil sector growth will moderate to 2.9 percent in 2025 and 2.5 percent in 2026, below the 4.7 percent achieved in 2024 . This deceleration reflects external headwinds and the structural challenges of sustaining diversification momentum amid fiscal consolidation. The implication for Angola-South Africa relations is that bilateral economic cooperation, while growing, operates within the constraints of Angola’s still-limited productive transformation.

3. Political and Diplomatic Alignment: Continental Leadership and Shared Agendas

The political dimension of Angola’s status in South Africa has undergone substantial evolution, particularly through Angola’s assumption of continental leadership roles that align with South African foreign policy objectives.

3.1 Angola’s African Union Leadership

President João Lourenço’s tenure as Chairperson of the African Union (concluding in February 2026) elevated Angola’s continental diplomatic profile substantially. In his address to the 38th AU Summit, Lourenço articulated positions closely aligned with South Africa’s longstanding foreign policy priorities: reform of the international financial architecture, restructuring of the UN Security Council, and enhanced African representation in global governance .

Lourenço’s forceful rejection of unconstitutional changes of government—warning against accepting as “new normal” the seizure of power through coups followed by elections to “legitimize” such acts—positioned Angola firmly within the continental democratic governance mainstream . This stance resonates with South Africa’s own constitutionalist foreign policy orientation and provides diplomatic cover for coordinated positions on contested governance questions.

The outgoing AU Chair highlighted initiatives including the Conference on Infrastructure Financing in Africa hosted in Luanda, mobilization of strategic international partnerships, and impetus for operationalizing the African Continental Free Trade Area . Each of these priorities directly benefits South African economic and diplomatic interests, creating convergence rather than competition in continental agenda-setting.

3.2 BRICS and Multilateral Coordination

Diplomatic coordination extends to multilateral forums including BRICS, where Angola and South Africa “advocate a greater African role in global governance” . Angola’s expressed interest in BRICS membership, while not yet realized, aligns with South Africa’s preference for expanding African representation within the grouping.

The two countries maintain mutual support in multilateral forums, reinforcing each other’s positions on continental and global governance questions . This diplomatic alignment reflects shared structural positions as regional powers seeking to translate economic weight into political influence within continental and global institutions.

3.3 Binational Cooperation Commission

The Binational Cooperation Commission serves as the primary mechanism for monitoring implementation of bilateral agreements and ensuring regular meetings between the two states . This institutional framework promotes coordination of joint initiatives and provides continuity beyond individual presidential terms or ministerial appointments.

The Commission’s focus areas—agriculture, energy, mining, transport, higher education, and security—reflect the comprehensive scope of bilateral engagement . Its regular meetings create predictability in bilateral relations and establish mechanisms for resolving disputes before they escalate to diplomatic confrontation.

4. Security Cooperation: Angola as Regional Mediator

Security cooperation represents perhaps the most consequential dimension of Angola’s status in South Africa, particularly given Angola’s mediating role in the Eastern Democratic Republic of Congo conflict.

4.1 Mediation in Eastern DRC

In February 2026, African leaders conferred on Angola a mandate to initiate consultations with all Congolese parties to create conditions for inclusive inter-Congolese dialogue . This mandate followed a Luanda meeting between President Lourenço, DRC President Félix Tshisekedi, Togolese President and AU Mediator Faure Gnassingbé, and former Nigerian President Olusegun Obasanjo .

The leaders appealed to parties in conflict in the DRC to declare a ceasefire and accelerate implementation of verification mechanisms agreed in Doha in October 2025 . They also recalled provisions of the Washington Agreement of December 2025 and UN Security Council Resolutions 2773 and 2808 providing for withdrawal of Rwandan troops from Congolese territory and neutralization of the FDLR .

Angola’s assumption of this mediating role carries significant implications for its relationship with South Africa. As the region’s traditional diplomatic heavyweight, South Africa has historically played leading roles in continental conflict resolution. Angola’s emergence as a credible mediator in one of Africa’s most intractable conflicts signals a more balanced distribution of diplomatic responsibilities within Southern Africa.

4.2 Joint Security Initiatives

Beyond DRC mediation, Angola and South Africa have committed to intensifying joint actions against transnational crime, terrorism, and illicit resource trafficking . This security cooperation addresses shared vulnerabilities, particularly regarding illicit financial flows and criminal networks operating across porous borders.

The security dimension of bilateral relations benefits from the personal relationships between Presidents Lourenço and Ramaphosa, both of whom emerged from liberation movement backgrounds and share generational and ideological reference points. Their regular interactions at AU summits and other continental forums facilitate direct communication on sensitive security matters.

5. Comparative Positioning: Angola and South Africa in Regional Context

Understanding Angola’s status in South Africa requires comparative perspective on both countries’ positions within Southern African political economy.

5.1 Economic Complementarities and Asymmetries

The Economic Diversification Index reveals significant asymmetries between the two economies. South Africa’s diversified economic structure (103.26) contrasts with Angola’s still-concentrated profile (80.51) . This asymmetry conditions bilateral economic relations, with South Africa typically exporting higher-value manufactured goods and services while importing primarily extractive commodities.

However, Angola’s substantial hydrocarbon wealth and growing mineral production (including recent kimberlite discoveries by the De Beers joint venture) provide leverage that partially offsets structural economic asymmetries . The De Beers negotiations illustrate how Angola is leveraging its resource endowment to secure equity positions in global value chains traditionally dominated by Northern corporations.

5.2 Demographic and Geographic Factors

Angola’s population of approximately 35 million, concentrated heavily in Luanda and the coastal corridor, creates substantial consumer market potential that South African companies are well-positioned to serve. Geographic proximity—Angola shares borders with Namibia, South Africa’s northern neighbor—reduces transportation costs and facilitates cross-border value chains.

5.3 Historical Legacies and Contemporary Relations

The historical relationship between Angola and South Africa carries complex legacies. South Africa’s apartheid-era military intervention in Angola’s civil war, including the protracted Battle of Cuito Cuanavale, created deep antagonisms that required decades to overcome. However, the shared experience of supporting liberation movements (Angola hosting ANC cadres during apartheid, post-apartheid South Africa supporting Angola’s post-war reconstruction) has gradually built reserves of mutual understanding.

These historical complexities condition contemporary relations in subtle ways. While official diplomatic discourse emphasizes cooperation and shared vision, the historical legacy creates expectations of mutual respect and sensitivity to perceived condescension. South African business and diplomatic engagement with Angola benefits from awareness of this historical context.

Conclusion: Angola’s Evolving Status and Future Trajectories

This paper has examined Angola’s economic and political status in South Africa across multiple dimensions: domestic political economy foundations, bilateral economic relations, political and diplomatic alignment, and security cooperation. The analysis reveals a relationship that has evolved substantially from the competitive regional hegemony of the late twentieth century toward strategic partnership in the twenty-first.

Angola’s status in South Africa is best understood through three interconnected dimensions: as an economic partner for diversification, as a diplomatic ally in continental governance, and as a crucial security interlocutor in regional stability architecture. Each dimension carries specific implications for bilateral engagement and regional integration.

Several factors will shape the future trajectory of this relationship. First, Angola’s success in economic diversification—including outcomes of the De Beers stake negotiations, agricultural development, and manufacturing expansion—will determine its capacity to engage South Africa as a more balanced economic partner. Second, political developments in both countries, including Angola’s 2027 national elections and South Africa’s own coalition politics, will influence foreign policy continuity and bilateral engagement. Third, regional security dynamics, particularly outcomes of Angola’s DRC mediation, will affect mutual perceptions of diplomatic competence and reliability.

The most significant finding of this analysis is the emergence of coordinated regional positioning in global value chains, exemplified by the De Beers discussions among Southern African diamond producers. This coordination suggests a potential model for resource-rich countries seeking to translate mineral wealth into sustainable development outcomes. If successful, such coordination could reshape not only Angola-South Africa relations but the broader political economy of Southern African resource extraction.

For South Africa, Angola’s evolving status represents both opportunity and challenge: opportunity to partner with a resource-rich neighbor pursuing diversification, challenge to adapt to Angola’s growing continental diplomatic weight. For Angola, South Africa remains simultaneously an essential economic partner, a diplomatic reference point, and a competitor for regional influence. Managing these multiple dimensions requires sustained diplomatic attention and institutionalized cooperation mechanisms.

The relationship between Angola and South Africa, in sum, reflects the broader transformation of Southern African regional politics: from liberation movement solidarity through post-conflict reconstruction to contemporary strategic partnership. Its future trajectory will substantially influence not only bilateral outcomes but the region’s collective capacity to address shared development and security challenges.

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