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Angola Mining Report Q2 2016

Angola Mining Report Q2 2016

BMI View: Despite a challenging outlook for commodities internationally, we are looking for Angola'smining sector to continue growing at a steady pace through the next few years as the government looks tomineral extraction as a means of diversifying the economy and easing its reliance on oil and gas exports.

Diamonds will remain the mainstay of the industry, with state-owned mining company currently increasingproduction to mitigate recent price falls. A lack of sufficient mining-related infrastructure remains anongoing obstacle to mining activity in the country and the government is looking increasingly to sourcemuch-needed investment by exploring partnerships overseas. We expect this to be a long-running themewhich should create opportunities for investors and new entrants over the next few years.

Latest Updates And Developments

We have revised our estimations for diamond output upwards for 2015 following the recent release ofprovisional production data by Angola's Ministry of Geology and Mining. Angola's diamond productionis, therefore, estimated to have grown by 5.6% in 2015 to 9.3mn carats. This increased level of outputreflect recent contraction in Angola's diamond export revenues, which are estimated to have shrunk toUSD1.1bn in 2015 due to a fall in global prices.

We are looking for mined diamond output to continue growing at a solid rate through the forecast period;we forecast production to increase by 4.1% in 2016 and to expand by 4.6% a year on average over2016-2020.

We maintain our view that Angola's mining sector is well placed to expand over the next few years as thegovernment looks to promote the diversification of Angola's economy. Further talks between the Angolanand Chinese governments in December 2015 illustrate the increased role that foreign investors are likelyto play in developing the country's mineral deposits.


BMI Industry View
Table: Angola Mining Industry Value (2013-2020)
SWOT
Industry Forecast
Diamonds: Output To Rise As Government Plots Expansion
Table: Diamond Production (Angola 2013-2020)
Structural Trends
Industry Risk Reward Ratings
Angola - Risk/Reward Index
Rewards
Risks
Africa: Major Risks Remain
Key Takeaways
Latest Revisions
Table: Africa - Mining Risk/Reward Index
Regulatory Development
Commodities Forecast
Commodities Outlook
Table: BMI Commodities Price Forecasts
Competitive Landscape
Table: Largest Mining/Natural Resources Companies In Sub-Saharan Africa
Company Profile
Endiama
Regional Overview
Table: SSA - Government Involvement In Mining Sector
Methodology
Industry Forecast Methodology
Sources
Risk/Reward Index Methodology
Table: Weighting Of Indicators

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