Luanda, Angola

It wasn't always this way. The Portuguese were first drawn to Luanda in 1575 because its port offered access to legendary silver mines. But the slave trade soon became the main attraction: In the seventeenth and eighteenth centuries, the Portuguese captured and shipped up to 2 million Angolans to South America and the Caribbean. Even after slavery was outlawed, the Portuguese used forced labor in Angola's countryside to grow cotton, sugar, rice and tobacco for export; others reaped riches off the country's vast diamond reserves. Luanda boomed in the 1930s, and by the 1970s it was among the continent's most modern and picturesque cities, its wide avenues boasting stunning examples of the finest Portuguese colonial architecture.

But all was not well. Angolans were agitating for independence and, after a military coup overthrew Portugal's forty-eight-year dictatorship in 1974, found themselves suddenly free. The bulk of the Portuguese elite professional and middle class abandoned the country. With no foundation for democracy and only the example of half a millennium of exploitation, Angola fell prey to vicious factional fighting. The Marxist Popular Movement for the Liberation of Angola, or MPLA, representing urban, middle-class, mixed-race Angolans, quickly won control of the government with the backing of the Soviet Union and Cuba. The National Union for the Total Independence of Angola, or UNITA, led by Jonas Savimbi, was supported in most rural areas of the country.

But if Angolans viewed the conflict as a civil war over ethnic, geographic and resource control, the West saw it as yet another domino to be defended in the cold war. UNITA quickly won support from neighboring South Africa and the United States.

By the time the war ended, with the assassination of Savimbi in 2002, more than 500,000 Angolans had been killed. Two million more had been driven from their homes. The countryside was scorched and the economy in ruins. Angola has gone from being the breadbasket of Africa to producing almost nothing; its sole successful industry is the manufacture of artificial limbs. Although in 1991 Angola officially abandoned Communism (the United States recognized the MPLA government soon afterward), its overnight transition to a market economy has done little to bolster living conditions. The only difference most Angolans notice is that they no longer get free education or healthcare.

For the mostly foreign elite, though, Angolan-style capitalism provides a warm welcome. Although prices are astronomical--a basic one-bedroom flat can cost twice what it would in London or New York, and the electricity and water go out several times a day--most company employees have all their expenses paid, and generators cushion the inconvenience of power outages. While some foreigners live along the palm-lined Marginal, Luanda's crumbling waterfront promenade, the oil companies maintain separate walled compounds of suburban-style houses for their employees on the outskirts of the city. Most foreign workers, including US Embassy employees, earn more money in Angola than they would almost anywhere else, due to extra "hardship payments." And while just a few years ago there was nothing to buy, a new sporting-goods store filled with Nike products and a Range Rover dealership have opened downtown.

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