GOVERNOR OF CENTRAL BANK SACKED; NEW GOVERNOR HAS

C O N F I D E N T I A L LUANDA 000250


DEPARTMENT FOR EEB/OMA ALEX WHITTINGTON
DEPARTMENT PASS TO USAID/EGAT AND AFR

E.O. 12958: DECL: 04/13/2019
TAGS: AO ECON EFIN ENIV PGOV PINR
SUBJECT: GOVERNOR OF CENTRAL BANK SACKED; NEW GOVERNOR HAS
NO BANKING EXPERIENCE

REF: A. A. LUANDA 237

B. B. LUANDA 200

C. C. LUANDA 159

Classified By: Classified by Charge Jeff Hawkins for reasons 1.4 (b)
and (d)


1. (C) Summary: As predicted in ref (A),Angolan central bank
Governor Amadeu de Jesus Mauricio was sacked by President Dos
Santos on April 11. The press has been silent about the
reasons for the dismissal, but it appears Mauricio was let go
because he had failed to secure authorization from either the
Minister of Finance or President Dos Santos before he
authorized the spending of international reserves, which have
declined by 25 percent in the last three months. Mauricio's
replacement is former Vice Minister of Industry Abraao
Gourgel, who appears to be unqualified for the post. The
appointment is not a step forward for fiscal responsibility.
End Summary


2. (C) On April 11, the Government of Angola announced that
Amadeu Mauricio, Governor of Angola's central Bank, Banco
Nacional de Angola (BNA),was stepping down, allegedly at his
own request. The official announcement, and the state-owned
press, was silent about the reasons for the "resignation."
According to Embassy sources, Mauricio was sacked. BNA Vice
Governor Rui Miguens (please protect) told us that Mauricio
had been fired for failing to seek authorization to spend
international reserves. (Note: Angola's reserves have
declined from USD 20 to USD 15 billion during the first three
months of the year. See Ref C.) The Chief Economist of the
World Bank office in Angola suggested to us that, if true,
this was a curious reason to fire a central banker, because
"that is what they do." His implication being that ideally
Mauricio should not have had to seek authorization from the
President for pursuing the GRA policy of a stable Kwanza.


3. (C) Also on April 11, President Dos Santos appointed
Abraao Pio de Amaral Gourgel as the new Governor of BNA.
Gourgel. Gourgel was the Deputy Minister of Industry from
1996 until this appointment and does not appear to have any
banking or finance experience in his past. A long-time MPLA
activist, he is rumored to have been educated in Cuba,
possibly in economics. According to contacts, he speaks no
other language besides Portuguese. He is not known to have a
particularly close relationship with President Dos Santos,
although several years ago the President appointed Gourgel
chair of a development commission for Uige province. When
USD 330 million from the USD 500 billion dollar Uige
development fund went missing, the Angolan press alleged that
Gourgel embezzled the money from this fund that the
commission was created to manage. Gourgel was never
indicted, the money was never recovered, and the scandal
eventually faded. During Gourgel's tenure at the Ministry of
Industry, the USDA canceled its Section 416(b) program with
the ministry due to improper reporting on the disposition of
the commodities and the ministry's failure to deposit the
proceeds of the sale of the commodities into a development
account as required by the agreement.


4. (C) Comment: Reftel reporting had speculated that Angola
was likely spending its reserves to defend an overvalued
Kwanza. Despite government denials, indications are that
there was a large increase in the demand for dollars at the
BNA from December to February, larger than can be accounted
for by Angola's average monthly import bill. Post believes
that Mauricio was savvy enough to at least inform either the
Minister of Finance and/or President Dos Santos before he
committed reserves to meet the increase in demand for
dollars. Either he committed the reserves absent a clear
response from his superiors, and following the GRA's stable
Kwanza policy, or his superiors had consented to defending
the Kwanza but were ultimately surprised at the magnitude of
the demand and at the cost in reserves of this policy
decision.


5. (C) Comment Continued. We do not understand President Dos
Santos's troubling decision to replace Mauricio with someone
who has no prior banking or finance experience during tough
economic times. One plausible explanation is that Dos Santos
wants a much tighter control over how the central bank spends
Angola's reserves and is willing to sacrifice competence at
the top while career BNA officials continue to run the day to
day operations of the bank. Vice Governor Miguens does not
intend to resign and Post believes that the operation of the
BNA will be in good hands if Miguens is the de facto decision
maker. Ultimately though, this was a decision based on
politics, not economics.


HAWKINS