Transportation costs escalate in Angola as petrol prices surge, affecting taxi and bus fares.
In a move aimed at maintaining the operational balance of transport companies and ensuring service continuity for the population, Angola has seen a significant increase in public transportation fares. The changes, which came into effect on July 4, 2025, have seen the fare for collective taxis (candongueiros) rise to 300 kwanzas per journey (approximately 0.28 euros), while urban bus fares have risen to 200 kwanzas per ride (about 0.19 euros).
The National Institute of Land Transport (ANTT) explained that these adjustments align with regulatory decrees that use a flexible system based on import/export parity. The system is designed to respond to changes in fuel prices, which have soared nearly 200% since the start of the subsidy removal process in 2023.
The rise in diesel prices, from 135 kwanzas to 400 kwanzas per liter, has had a severe impact on transportation costs. This increase is part of the gradual elimination of fuel subsidies, a move that the Angolan government estimates will save around 400 million kwanzas per year (around 372 million euros).
The hikes come amid broader fiscal reforms in Angola aimed at reducing the government's subsidy burden and redirecting funds to priority sectors such as health, education, and infrastructure. However, the increases pose a social challenge, as more than half of Angola's population lives on less than $2 per day, raising concerns about affordability and potential social unrest.
The Angolan government has appealed for understanding from citizens "in light of the global economic context." They have not mentioned any specific changes in fares for intermunicipal passenger services, nor have they provided any new information about the reference values used in the calculation of fares. They have also not mentioned any exceptions to the fare adjustments based on the import and export parity.
The government has emphasised that whenever there is an adjustment in fuel prices that does not exceed the reference values used in the calculation of fares, these should not be changed, maintaining stability for users. However, the current price of gasoline is 400 kwanzas per liter (0.37 euros), significantly higher than the reference values used in the calculation of transport fares.
In summary, the removal of fuel subsidies in Angola has led to marked increases in public transportation fares, reflecting the sharp rise in diesel prices. This is part of a broader fiscal reform strategy with significant economic and social implications for the population.
What effects might these changes in public transportation fares have on the finance industry, considering the Angolan government's fiscal reforms are focused on reducing subsidy burdens and reallocating funds to sectors like health, education, and infrastructure? Could the rise in diesel prices, affecting transportation costs, potentially influence the fiscal health of companies operating within the transportation industry?
