Industrialization in times of China: Domestic-market formation in Angola

This article investigates patterns of manufacturing sector development in Angola since the end of the civil war in 2002 and shows that emerging forms of manufacturing production in Angola come out of a process of domestic-market formation, in other words an increase in domestic demand. Domestic-market formation was partially supported by economic engagement with China, because Chinese contracted projects increased demand for building materials, while increased export demand from China allowed for higher volumes of capital goods imports. In addition, the anticipation of a growing consumer demand base in the wake of the China-fuelled oil price boom attracted increasing volumes of foreign and domestic investment in food and beverages production. This article shows that China's impact on manufacturing sector development goes beyond export-oriented light manufacturing, but also reveals broader challenges to late industrialization. At face value, statistics seem to suggest progress in terms of manufacturing sector growth, even if the latter remains in the shadow of the much larger mining sector. Yet, the Angolan case also illustrates the importance and difficulty of maintaining a growing domestic demand base.