These are only the companies that officially communicated their decision to the GUE. The business environment, the complexity and aggressiveness of the tax system, the loss of purchasing power among the population, and difficulties in receiving payments have all contributed to this phenomenon. Several of these entrepreneurs continue their activities informally.
In the first semester of this year, 158 companies were dissolved via the One-Stop Business Counter (GUE). The number of definitive formal closures rose by 107% compared to the same period in 2024, according to Expansão based on GUE data. Although the GUE does not provide reasons for the end of activity, specialists point to the depreciation of the national currency, the economic situation, and the business climate as the main causes. Many of these companies that officially closed down end up giving rise to informal businesses, as entrepreneurs need income to survive.
Among the companies that formally exited the national business landscape, GUE statistics — a public inter-agency service that streamlines the process of setting up companies — show that more than 60% operated in the goods trade sector, about 15% in the service sector, and just over 7% in small industries, mainly in the food and construction segments.
The list also includes companies in the financial sector — such as two insurers — as well as consulting firms, beauty services, healthcare providers, and professional training centers. In terms of legal structure, 83 were single-member limited liability companies, 70 were multi-member limited liability companies, and the remainder were joint-stock companies.
To give an idea, if each of these dissolved companies employed an average of five people, that means about 790 workers are now looking for new jobs. It’s worth noting that these figures only include companies that formally declared closure through the GUE. Businesses that have become inactive or stopped operating without officially notifying authorities are not included in these statistics.
There are several objective reasons for these closures, especially in the trade sector, which represents the largest part of the country’s business fabric. Many companies depend almost exclusively on importing goods for local resale due to weak domestic production.
“When you have a currency that devalues sharply, as is the case with the Kwanza, that depreciation makes imports more expensive. In other words, traders and other importers need more Kwanzas to bring in the same amount of goods. In our case, we have both currency devaluation and difficult access to foreign currency,” explained Bernardo Vaz, economist and researcher at the Economic Research Center (Cinvestec) of the Lusíada University of Angola.
According to the researcher, these two factors generally limit imports. As a result, many companies that once sourced goods abroad try to find local suppliers but rarely succeed, given the scarcity of national production for various goods. Thus, importers struggle to keep shelves stocked, which reduces business volume and profits, forcing some entrepreneurs to make the tough decision to shut down to avoid accumulating losses.
Lower Consumption
The high number of dissolutions reflects the challenging economic environment faced by entrepreneurs, also marked by the continuous erosion of household purchasing power, which is not cyclically restored.
“At one point, we did a study and concluded that from 2003 to 2024, the average inflation rate was 21% per year. This means that during this 22-year period, salaries lost, on average, 21% of their real value every year. Anyone in the non-essential goods trade looks at these numbers and scales back activity, knowing that most of Angolan household budgets go to food, with the remainder for education, transport, and health,” the economist recalled.
A company selling electrical and plumbing materials told Expansão that since 2023, it had been struggling to meet its tax obligations. “We started having fewer sales, almost no one has been building houses in recent years, and we couldn’t survive just on selling repair and maintenance products. On top of that, there were tax burdens. It was hard, but we had to close down,” said the manager.
In practice, the absence of relief measures to encourage investment and sustain existing companies also contributes to multiple closures during crises.
For Bernardo Vaz, it is necessary to ease the tax burden so companies can generate enough cash flow to meet obligations and preserve jobs. Otherwise, “we will have companies working only for the tax authorities.” The way the General Tax Administration (AGT) pressures formal companies — including demands in the VAT refund process — has made it difficult for micro and small enterprises to remain in the formal economy.
For example, in India, micro and small enterprises are exempt from income tax for their first three years of activity to encourage reinvestment and growth. In South Africa, startups benefit from tax exemptions for their first five years, provided they show positive results and growing balance sheets.
More Informality
Despite efforts to formalize the economy and simplify procedures, informality levels remain high, covering nearly 80% of economic activity.
The concern is that many companies that have ceased formal operations may move into informality, given the high cost of formalization.
“We compete with those selling construction materials in the informal market, who don’t pay VAT, income tax, social security, or other taxes. When you think about it seriously, there’s no advantage to being formalized,” said the entrepreneur who closed his shop. For Bernardo Vaz, “when a company is struggling, the State doesn’t read the context and continues to burden it with taxes and rules, which also come with costs.”
On the other hand, there has been an increase in the creation of new companies, facilitated by GUE services. However, there is no data on how many of these companies actually start operating in a market with a business mortality rate above 70%, according to the latest (2017) figures from the National Statistics Institute, with the highest incidence among small and medium-sized enterprises. A recent study also found that about two-thirds of newly registered companies never start operations.
Expansão , 15/08/2025
