How fuel price hike and currency depreciation sparked protests across Angola

On 6 June, protests about increased fuel prices and the Angolan Kwanza (AOA) depreciation broke out across the country. In Huambo Province, police fired on protesters with live ammunition, killing at least five people. In other areas, ranging from Zaire to Hulía, protesters were also brutally suppressed, despite the National Assembly passing the Bill on Freedom of Assembly on 25 May. Since then, impromptu protests led, often led by taxi organisations, have occurred across the country. The largest of these happened in Namibe on 13 June, leaving eight injured and 48 arrested. Angolan civil society organisations also arranged a more formal protest on 17 June which also saw police attack peaceful protesters nationwide. Most reporting has focused on the protests in Luanda, where police used tear gas and rubber bullets to disperse crowds, resulting in around an unreported number of injuries and arrests. In Bengula, at least 70 people were arrested for vandalism. Multiple embassies and foreign companies in major cities have sent out warnings, as it does not appear these protests will abate anytime soon. Indeed, taxi drivers in Luanda have suspended their services from 19 to 21 June in protest of the fuel hike and the government’s failure to provide public transport operators with discounts to preserve reasonable fares.

*Note: It should be noted that the Angola media is highly censored, and information on multiple ongoing protests can be difficult to track. Reports will generally focus on hotspots where unrest and police brutality are at their worst, but it should be assumed that protests can break out anywhere, and the potential for violence and vandalism is high at every demonstration.

The scandal surrounding the protests forced the former Minister of Economic Planning, Manuel Nunes Junior, to resign. He has been replaced by the former head of the National Bank of Angola (BNA/Banco Nacional de Angola), Jose de Lima Massano. Manuel António Tiago Dias has taken over the position of Governor of the BNA.

For decades, the Angolan government has been subsidising fuel companies to help artificially depress fuel prices. However, most economists advise against governments subsidising fuel companies, as it channels resources out of the economy and limits actual funds needed for development. Moreover, governments can become heavily indebted to fuel companies, giving them undue influence over policy decisions and increasing corruption. Thus, President João Lourenço and the ruling Popular Movement for the Liberation of Angola (MPLA/Movimento Popular de Libertação de Angola) party agreed to phase out fuel subsidies as part of a bailout deal with the International Monetary Fund (IMF).

When Nunes Junior announced this policy in August 2022, it was lauded by many in Angola, including many members of the National Union for the Total Independence of Angola (UNITA/União Nacional para a Independência Total de Angola), the country’s second-largest party and leader of the opposition. At that time, the Angolan economy was booming due to an increase in the oil price triggered by the War in Ukraine. The AOA was the strongest-performing currency in the world at the time, having appreciated by about +60% against the United States Dollar (US$), from around AOA 650/US$ to AOA 400/US$. The Angolan government was able to use this sudden increase in currency value to sell bonds and eliminate large amounts of its debts and appeared well set to be able to phase out fuel subsidies.

However, since August 2022, the AOA has depreciated by around -38% and is currently valued at AOA 630/US$ and seems to be losing value fast. This is partly due to the drop in oil prices, causing a decline in oil revenues. While economists expected this, the oil price drop from over US$120/barrel in May 2022 to under US$70/barrel (Brent crude is currently trading at US$68/barrel) has slashed oil revenues in Angola, destabilising the AOA.

Thus, while economists expected a slight increase in fuel prices (around 10%-20%) in 2022, the actual price soared by nearly 100%, from AOA 160/ℓ (US$0.24/ℓ) to AOA 300/ℓ (US$0.45/ℓ). This increase also occurred at the beginning of the lean season in Angola, as retailers rely more on exports and farmworkers travel to find non-agricultural seasonal labour. Moreover, the government had promised to pay taxi drivers subsidies to cushion them from the expected fuel price increase. However, with government revenues dropping faster than expected and the depreciation of the AOA endangering future credit agreements, the MPLA reneged on its promise. As such, the sudden doubling of fuel prices occurred at a time when they would be felt the most, triggering mass protests.

Even UNITA, which continues to support ending fuel subsidies, has been critical of the manner that the MPLA withdrew the subsidies. In the buildup to the 6 June protests, UNITA’s President Adalberto Costa Junior released a statement claiming the MPLA had used fuel subsidies to facilitate corruption that enriched its leaders. Now the ruling party has ended the practice; it has passed the costs of its failed policies onto the Angolan people.

The MPLA, which has ruled Angola since 1974, control over the government has become increasingly weak since the country’s economy collapsed in 2016. In 2022, it only managed to win 51.17% of the vote and 124 out of the 220 seats in the National Assembly. Many Angolans, including Costa Junior, have alleged that the government rigged the elections, which resulted in mass protests across the country in September 2022. However, the MPLA was never in any real danger of losing power. That said, the new wave of protests will pose a significant threat to the MPLA’s increasingly tenuous grip on power and could result in increased state repression, despite promises of reform from the government.

Indeed, the National Police have blamed UNITA for instigating violence during the protests in an attempt to defend the police’s actions. However, on 16 June, UNITA’s leaders stated that it would not be formally participating in the 17 June protests. That said, some chapters of UNITA’s youth branch, United Revolutionary Youth of Angola (JURA/Juventude Revolucionária Unida de Angola), were in attendance, while other protesters chose to wear UNITA branded clothing in a show of support for the opposition. Nevertheless, there is no evidence outside of the police’s claims that UNITA or JURA members were responsible for damaging property, nor is there any evidence that the party’s leaders ordered protesters to be violent. Instead, images on social media show police firing tear gas and rubber bullets indiscriminately into crowds, arresting random people on the street, and creating the chaotic environment that likely led to the acts of vandalism and looting occurring.

The police’s decision to blame the unrest on UNITA is also extremely dangerous. While the party’s formal structures are no longer militant, subsects of the party hold grudges from the civil war and are willing to clash with the police. Moreover, the MPLA’s youth branch, the Youth of the MPLA (JMPLA/Juventude MPLA), has become increasingly violent and is willing to attack perceived enemies of the state under the guise of vigilante activism. As such, while the police’s decision to politicise the unrest by blaming UNITA will not cause another civil war, it will likely trigger an increase in sectarian violence and unrest across the country.

ERA