Working Paper
Foreign Aid, Resource Rents and Institution-Building in Mozambique and Angola

Sharing similar colonial and post-independence civil war experiences, Mozambique and Angola’s development paths are often contrasted, with foreign aid-dependent Mozambique hailed a success compared to oil rentier Angola. This paper questions the so-called Mozambican miracle and contrasts it with Angola’s trajectory over the past two decades. Paying attention to the political trajectory of the ruling parties as well as the different timing and conditions linked to the post-war political economy transition, we discuss differences and similarities in the post-conflict reconstruction trajectory, policy space, and relative institutional fragility. We suggest that large aid flows to Mozambique have contributed to a relaxation of its government’s urgency in creating the financial structure capable of capturing rents from natural resources in contrast to Angola, while the relative absence of official development aid has led Angolan elites to seek tenure prolongation partly through high rent capture and incipient socialization of massive oil rents. We conclude by discussing the likely consequences of these factors in terms of the relative ‘fragility’ and ‘robustness’ of both states, and discuss implications for foreign assistance.