Figure 9. Economic Activity, 1988

Once one of the country's major exports, iron ore was no longer mined in the late 1980s because of security and transportation problems. From the mid-1950s until 1975, iron ore was mined in Malanje, Bié, Huambo, and Huíla provinces, and production reached an average of 5.7 million tons per year between 1970 and 1974. Most of the iron ore was shipped to Japan, West Germany, and Britain and earned almost US$50 million a year in export revenue. After independence, the government established a state company, the National Iron Ore Company of Angola (Emprêsa Nacional de Ferro de Angola--Ferrangol), for the exploration, mining, processing, and marketing of iron ore. Ferrangol contracted with Austromineral, an Austrian company, to repair facilities and organize production in Cassinga. Production began to slow in 1974 as a result of technical problems at the Cassinga mine in Huíla Province and stopped completely in August 1975. The area fell under foreign control after South African forces invaded in 1975. Although South Africa withdrew its troops in early 1976, as of 1988 mining had not resumed in the area.

By 1988 the Cassinga mines had a production capacity of approximately 1.1 million tons per year. However, the railroad to the port of Namibe (formerly Moçâmedes) needed extensive repair, and since it was located only 310 kilometers north of the Namibian border, security against South African attacks could not be ensured. Furthermore, UNITA was active in the area and posed a threat to the rail line if it were repaired. Even if these problems could be resolved, production of iron ore at Cassinga would be costly in view of the depressed state of the world steel market in the late 1980s.

Data as of February 1989