Today in Luanda, the Brazil-Angola Cooperation and Investment Facilitation Agreement (CIFA) between Brazil and Angola was signed by the Minister of Foreign Affairs, Mauro Vieira, and his Angolan counterpart Georges Rebelo Chikoti.
The treaty is the second to have been signed on the basis of Brazil’s new model for investment agreements prepared by Itamaraty, the Ministry of Development, Industry and Foreign Trade, and the Ministry of Finance, in consultation with the private sector.
A memorandum of understanding to promote investment was also signed. It creates a bilateral working group, comprising representatives from government and the private sector, which will initiate projects focused on industrial cooperation. Given that the CIFA still has to be approved by the National Congress, the Brazilian government anticipates that the memorandum will lead to a long-term partnership with the Angolan government, aimed at diversifying the Brazilian business presence in Angola, stimulating exports, and promoting integration between the two countries’ productive sectors.
Brazil’s business presence in Angola is already quite diverse, including sectors such as cosmetics, construction, retail, information technology, and education. Angolan capital investment in Brazil, although still in its early stages, has begun to grow quickly. According to figures from Brazil’s Central Bank, Angolan investment in Brazil in the period 2001-2010 totaled $ 114 million – but the total in 2011 alone was $ 128 million. The principal areas involved are support activities for petroleum and natural gas extraction, holdings for non-financial institutions, research and experimental development in the physical and natural sciences, and cattle.
The CIFA signed with Angola represents a new kind of agreement, seeking to encourage reciprocal investment through intergovernmental dialogue, and supporting companies in the internationalization process. Through the CIFA, business opportunities will be publicized more widely, information will be exchanged regarding regulatory frameworks, and there will be an appropriate mechanism to prevent or, if necessary, resolve disputes. The new model provides a solid framework for two-way investment.
Inter-ministerial missions to negotiate CIFAs have so far taken place with South Africa, Angola, Algeria, Malawi, Morocco, Mozambique and Tunisia. A CIFA has already been signed with Mozambique, and now with Angola, and negotiations have been completed with Malawi. South American countries have also indicated their interest in starting similar negotiations.