Angola rebuilding to attract capital for farms, mining

LUANDA (Reuters) - Angola's rapid rebuilding after a devastating civil war will attract foreign companies to invest in its ample natural resources and help diversify the economy away from oil, the new head of the country's investment agency said on Thursday.

Maria de Luisa Abrantes, President of the Angolan Agency for Private Investment (ANIP), also told Reuters that a new investment law passed in 2011 is helping the government approve foreign investment projects more rapidly and monitor their effectiveness more closely.

"By clearing the mines left by the war, we not only started but then sped up the reconstruction of infrastructure. You can see we are working day and night," Abrantes said. "Without that, it would be impossible to diversify the economy."

Angola is Africa's second-largest oil producer after Nigeria and crude output represents 45 percent of the country's GDP and over 95 percent of export revenues.

Oil has helped it post rapid growth after a long civil war ended a decade ago - GDP is expected to expand over 10 percent this year - but analysts say it must diversify its economy to reduce the possible effects of crude price drops.

The government has recognized this need, and last year passed new rules for foreign investment, offering incentives such as tax breaks, reduced red tape and giving ANIP more authority to approve the incentives for various sectors.

Some investors say the approval of projects under the law is slow, but Abrantes said ANIP has kept to the timetables.

"The law sets deadlines, including for the president, who has to approve projects above $10 million, which shows we are willing," she said, adding that delays have often resulted from incomplete information provided by prospective investors.

"Even the large projects, which have to be approved by the cabinet, are taking only 40 to 45 days," Abrantes added.

The law also offers incentives for investment in Angola's interior provinces and forces companies to hire local staff in the medium-term of project lifecycles.

Angola has a poor record in fighting corruption, but Abrantes said the type of "serious" investors the country wants to attract follow the laws and are not put off.

"You can say there is corruption, and it exists, but there is no country in the world without it. No foreign investor who bribes an Angolan can come and complain afterwards," she said.

Since her appointment in November, the agency has approved 23 projects, totaling 1.84 billion euros in proposed investment, she said.

Angola is the largest recipient of foreign direct investment in sub-Saharan Africa, with data from U.N. agency UNCTAD showing inflows of nearly $10 billion in 2010, though down from $16.5 billion two years earlier due to the global financial crisis.

Abrantes said those flows include investments in oil projects, adding that inflows for non-oil sectors alone came in at $13.6 billion in 2007-2011.

The government's focus is now on rebuilding road, railway, energy and water grids to attract capital for key sectors.

"We have priorities. First agriculture, then light industry, and when infrastructure is ready, heavier industry," she said.

Angola's mineral wealth, besides oil and diamonds, also offer opportunities for foreign investors.

"We know the mineral resources we have, and we are putting together a guide for investors, showing what each province holds," Abrantes said.

"But it comes back to infrastructure. No-one can export minerals without roads."

ANIP expects its main overseas investors - China, Portugal, Brazil and the United States, the latter though often through "fiscal paradises" like the Cayman Islands - to remain strong partners, but others are queuing up too.

"We have some Italian and Spanish investors, Germany last year signed cooperation deals, Japan and Argentina have sent delegations recently, and France has also shown interest," Abrantes said.

"That shows there is a great appetite for our market."

(Reporting by Shrikesh Laxmidas; Editing by Hugh Lawson)