Foreign firms may be lining up to do business in Angola, but they will need cash by the bucket-load if they want to establish a permanent presence. The country is slowly recovering from a 27-year civil war which destroyed its health and education systems and left its infrastructure in tatters. Amid awful poverty, two thirds of its population somehow scrape by on less than $ 1.70 a day.

It comes as a surprise to many visitors that the capital, Luanda, is an expensive city. In 1998, Swiss-based Corporate Resources Group put Luanda as the 14th most costly place in the world to live, beating New York and Geneva. Luanda, where the US dollar is widely accepted or easily exchanged into thick wads of the national kwanza currency, is missing from more recent surveys, but triple-digit inflation until 2003 has kept it pricey.

A buoyant business climate means conditions are ripe for costs to climb further as existing oil firms, building on offshore success which has made Angola sub-Saharan Africa’s second largest oil producer, beef up expatriate staff. Entrepreneurs from non-oil sectors are also descending on Angola in droves to take advantage of its post-war recovery. Real estate agent Antonio Paim says the cost of renting a home for an expatriate family has soared in the last 12 months. He says firms should be prepared to fork out $ 15,000 a month for a house equipped with water, generator and phone connection.

“Property here is already ridiculously expensive, but prices are going to go even higher. There are simply more people looking for houses than there are houses to rent,” he said. The end of the war in April 2002 has certainly supported trade, and for those who have successfully run the housing gauntlet, finding reasonably priced food and drink to put on the table is becoming less difficult. The cost of basic items has come down, with several large supermarkets opening their doors and lifting competition, but the price of “luxuries” such as strawberries, mushrooms and French cheese can still spark gasps in the supermarket aisles.

<B>Karen ILEY</B>