Angolan court rejects opposition complaint on sovereign fund

Reuters News
Posted: Feb 08, 2013 5:40 PM

LISBON (Reuters) - Angola's constitutional court on Friday rejected a claim by an opposition party that President Jose Eduardo dos Santos had overstepped his powers to create the country's $5 billion sovereign wealth fund.

Angola launched the fund last October to invest in domestic and overseas assets by funneling the country's vast oil wealth into infrastructure, hotels and other high-growth projects.

Dos Santos has been accused of avoiding public scrutiny during his 33 years in power. The announcement of the fund raised criticism from opposition groups about transparency as it did not give parliament any oversight and appointed one of the president's sons to the fund's management board.

Opposition party CASA-CE in December asked the constitutional court to overturn the creation of the fund, arguing that the constitution did not allow a president to create reserve funds by decree without the approval of parliament.

The court, however, ruled in favor of the president's argument that the creation of a "special financial reserve oil fund for infrastructure" had been approved in parliament as part of the 2011 budget bill.

According to the court, the constitution gave the president powers to manage the reserve fund, which included setting up an "Oil Fund" through a decree in March 2011. The oil fund was converted into the sovereign wealth fund last October.

"It was concluded that the president, in creating the Oil Fund, obeyed the legal-constitutional principle of the separation of powers and did not infringe on the rights of parliament," the court said in its ruling.

Dos Santos last year led his MPLA party to a landslide win in an election, securing 72 percent of the votes.

(Reporting by Shrikesh Laxmidas; Editing by Pravin Char)