VZCZCXRO4778
RR RUEHBZ RUEHDU RUEHJO RUEHMR RUEHRN
DE RUEHLU #0171/01 0531501
ZNR UUUUU ZZH
R 221501Z FEB 07
FM AMEMBASSY LUANDA
TO RUEHC/SECSTATE WASHDC 3733
INFO RUCNSAD/SOUTHERN AFRICAN DEVELOPMENT COMMUNITY
RUEHBJ/AMEMBASSY BEIJING 0093

UNCLAS SECTION 01 OF 02 LUANDA 000171 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
FOR AF/S AND EAP/CM 
 
E.O. 12958: N/A 
TAGS: ETRD EINV PINR CH AO
SUBJECT: CHINESE IN ANGOLA: DOING BUSINESS AND SETTLING IN 
 
REF: 06 LUANDA 1204 
 
¶1. (U) This is one in a series of cables on the Chinese 
business community in Angola.  Previous cables have examined 
the Chinese line of credit. 
 
¶2. (SBU) Summary:  Chinese businesses, especially 
construction companies, are highly evident in Luanda.  The 
Chinese are having an impact on the landscape of the city, 
and the cross cultural experience is having an impact on at 
least some of the Chinese.  Chinese corporations, taking 
advantage of preferential contract awards under the Chinese 
line of credit, export their excess capacity to Angola, while 
higher earnings are the draw for most of the Chinese workers. 
 While a few of the companies may eventually shape themselves 
into viable international concerns through their experience 
in Luanda, most still operate in a very provincial fashion. 
End Summary. 
 
Sticking (it) Out in Luanda 
--------------------------- 
¶3. (SBU) Chinese workers and businessmen are a visible 
presence in Luanda, walking, riding, driving and working out 
of doors.  Working in Angola is a chance to earn more money 
for Chinese workers.  For example, a telecommunications 
worker earning USD 2300 per year in China works 10 months in 
Angola for an additional USD 7100 with a two-month break in 
China.  Others will wait two years before going home.  An 
independent Chinese entrepreneur, already in Angola for 
several years, confided to econoff that he would never have 
been able to earn several million dollars per year by staying 
home. 
 
¶4. (SBU) Each Chinese company operates as a self-reliant 
group and its employees keep largely to themselves.  Like 
many other expatriates in Angola, they look to their 
companies to provide certain services.  Although workers 
build their own dormitories, one company imported a farm 
family to raise fresh vegetables in a two-hectare garden. 
Some companies also employ Chinese cooks.  As a group, the 
Chinese in Angola are overwhelmingly, but not exclusively, 
male.  The main interest is in acquiring a small fortune to 
take back to China, thus many office workers will watch DVD's 
at their computer on the weekend rather than go out on the 
town in Luanda, one of the most expensive cities in the 
world. 
 
¶5. (SBU) Although the exact terms of Angola,s oil-backed 
bilateral line of credit from China have not been published, 
they reportedly include provisions requiring the Government 
of Angola to contract with Chinese firms for projects funded 
through the line of credit.  For their part, the Chinese 
companies are required to hire at least 30 percent Angolan 
employees in their projects. 
 
Westward Bound 
-------------- 
¶6. (SBU) Less well-known Chinese businesses such as the 
Guangxi Hydroelectric Power Company and the 20th Railway 
Construction Brigade have come to Angola.  Angola offers a 
protected market for Chinese companies because of the credit 
line tie-ins.  At the same time some of the Chinese companies 
are trying to improve their building and business techniques 
and prepare to compete head-to-head in the future with 
international construction firms now active in Angola and 
elsewhere. 
 
¶7. (SBU) Near Viana, east of Luanda, the 20th Railroad 
Construction Brigade, a state-owned enterprise based in 
Shaanxi Province, is building the 467 kilometer rail line 
between Luanda and Malange.  Roughly 75 percent of the 
company,s employees are Angolan, but none work in skilled or 
supervisory positions.  In general, Chinese businesses have 
no interest in training Angolans for more responsibility. 
Further, most Chinese have limited Portuguese language 
skills, and very few Angolans speak Chinese. 
 
Quality of Workmanship and Excess Capacity 
------------------------------------------ 
¶7. (SBU) Some Angolans have criticized Chinese contractors 
for shoddy workmanship.  For example, the Panguila low-income 
housing project north of Luanda has come under fire.  While 
cracked walls are a poor advertisement, the houses are 
painted, wired and have indoor plumbing.  Many of the houses 
they are replacing had none.  Criticism that the housing is 
isolated from jobs and stores is a greater problem, but one 
that resulted from a GRA decision and not blamable on the 
Chinese.  Highly visible Chinese projects in central Luanda 
include the Ministry of Finance building completed in 2005, 
 
LUANDA 00000171  002 OF 002 
 
 
renovation of the Luanda Provincial headquarters building, 
several schools and the railway line to Malange.  To date 
there have not been many complaints about these works. 
 
¶8. (SBU) Chinese firms in Angola also seek to use their 
excess capacity.  The 20th Railway Construction Brigade,s 
manager, while trying to win the contract to build Luanda,s 
new international airport, also kept his deputies scouting 
for small projects, such as small apartment renovations ) 
completed over successive weekends. 
 
Cross-Cultural Misperceptions 
----------------------------- 
¶9. (SBU) As with any mixture of cultures, stereotypes and 
misinformation cloud the perceptions of each group. Many 
Chinese see Angolans as lazy, and themselves as industrious 
for their willingness to work long hours and forgo weekends. 
Many also see Angolans as spendthrifts, while some note that 
they are generous.  According to several Chinese drivers, 
they present an attractive target for Angolan policemen 
waving them to the side of the road to inspect documents but, 
in essence, requesting bribes.  (Note: This is a common 
practice in Angola, though non-Angolans are especially likely 
to be pulled-over. End Note.)  The more outgoing Chinese work 
actively to learn Portuguese and cultivate Angolan friends. 
Meanwhile Angolan rumors abound that there are hundreds of 
thousands of Chinese &invading8 Angola.  Many Angolans also 
believe that the Chinese workers are former prisoners, 
released from jail in exchange for moving to Angola to work, 
although Mission's Chinese-speaking econoff has met no 
Chinese worker who fits that description. 
 
¶10. (SBU) Comment: Embassy Luanda has noticed the 
demonstrable influx of Chinese over the past year, with many 
more presumably mid- and upper-level Chinese workers visible 
at local restaurants, at supermarkets or driving around the 
city.  Lower level laborers tend to be seen working on road 
and other construction projects outside the city.  Chinese 
businesses (restaurants, small shops) are also springing up 
to support the Chinese workers in Angola.  While the majority 
of the Chinese are here for short term contracts to make 
their fortune and return to China, a few are putting down 
roots with long term intentions.  Whether businesses will be 
able to turn into world class construction firms through 
their Angolan experience remains to be seen, but in the 
meantime, they will certainly return home with sizeable 
profits. 
EFIRD