Relations between Portugal and Portuguese-speaking Africa: trade, investiment and debt (1973-1994)

Abstract

Any analysis of the main characteristics of the present economic relationship between Portugal and Portuguese-speaking Africa (PALOP) - disregarding factors associated with the present economic situation - cannot ignore the influence of two structural milestones: on the one hand the independence of this group of countries (1975) which resulted in the dissolution of bilateral, preferential ties and in the search for new partners and allies, and on the other hand Portuguese membership of the EEC (1986). The period between those countries' independence and 1994 shows that those markets continue to absorb most Portuguese exports to the African continent, inversely to what has happened to Portuguese imports from them. As far as Portuguese investment is concerned, there has been a clear drop as a result of EEC membership. But this article also compares the present bilateral relationship with 1973. It registers, in relative terms, a sharp fall in foreign trade and investment. Given the numerous internal factors that have contributed to the worsening of the PALOPs' economic performance, the structure of Portuguese foreign trade largely reflects these countries' internal supply limitations (notably in Mozambique and Angola) and on the other hand determines the future extent of bilateral economic relations. In addition, the high country-risk has proved to be an inhibiting factor for Portuguese investment. Thus the heavy foreign debt that these countries have contracted with Portugal is only a reflection of this situation.