The National Assembly of Angola will hold a vote today on a bill changing laws on a tax regime on oil concessions in the exclusive economic zone of Cabinda. Photo: Teixeira Duarte Construction

The National Assembly of Angola will hold a vote today on oil concessions.

Earlier this month, leaders of the Angolan parliament drafted a bill which would allow President Joao Lourenco to change laws on a tax regime on oil concessions in the exclusive economic zone of Cabinda. Despite the large oil reserves, the Angolan enclave has long been an area of contention between the Angolan government and Front de Liberation de l’enclave de Cabinda (FLEC), one of the most notorious separatist groups in Africa.

If passed—likelihood of which is considerably high—the new tax bill will bring Cabinda closer towards Luanda’s direct control during the short-to-medium term, abating FLEC’s heavy influence in the region. While the separatist movement will not be completely eradicated, overall insurgency in the region will likely decline under increased government pressure. Furthermore, this new bill will also consolidate President Lourenco’s overall power within the country. On the economic front, the new bill will also provide several incentives by creating various fiscal opportunities to draw new investments—most notably from large oil companies— to the region. In turn, this will have a positive impact towards Angola’s GDP medium-term.