Angola’s New Hydropower and Chinese FinanceCEFR B2
17 Dec 2025
Adapted from Vivian Wu, Global Voices • CC BY 3.0
Photo by Isaac Lind, Unsplash
Laúca and Caculo Cabaça are now central pieces of Angola’s push to expand hydropower and present Chinese-backed projects as green finance. Laúca added more than 2,000 megawatts to the national grid. China Pictorial’s March 2024 feature praised Chinese cooperation on green finance, mentioning green bonds, green loans and green development funds, and it named Caculo Cabaça as Africa’s largest hydropower project. The report also said Ping An Bank, via a Shanghai Free Trade Zone account, took part in financing Caculo Cabaça and extended credit services to a sovereign state for the first time.
Observers trace the model back to a 2017 Cheng Cheng research center report that called Angola a testing ground for a resource-for-infrastructure approach. Chinese finance often came with longer maturities and grace periods and fewer governance conditions. Boston University data show Angola received more than USD 40 billion in Chinese loans, much of it tied to oil-backed repayment; when oil prices fell after 2014, debt servicing took a growing share of public revenue.
Local investigative outlets like Maka Angola have documented opaque terms and delayed disbursements, and international coverage frames Angola as a site of strategic competition. At the EU–AU summit in Luanda, Deutsche Welle reported EU leaders saw Chinese infrastructure financing as a challenge, while President João Lourenço said Angola does not want to depend on a single partner. Long-term operation of the dams will depend on transparency, debt sustainability and whether the projects ultimately expand or constrain national development goals.
Difficult words
- hydropower — Electricity produced from moving water
- green finance — Money or loans for environmentally friendly projects
- sovereign state — An independent country with its own government
- maturity — Time until a loan or debt must be repaidmaturities
- grace period — Extended time before loan payments must startgrace periods
- governance — Rules and practices that control an organization
- disbursement — Payment of funds from a lender or funddisbursements
- debt servicing — Payments made to cover interest and principal
- opaque — Not clear or easily understood
Tip: hover, focus or tap highlighted words in the article to see quick definitions while you read or listen.
Discussion questions
- What are possible benefits and risks of using Chinese green finance for large infrastructure projects in Angola? Give reasons from the text.
- How did falling oil prices after 2014 affect Angola’s ability to repay Chinese loans, according to the article?
- What steps could help ensure that the dams expand rather than constrain national development goals?
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