AFRICA REVIEW

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP87T00289R000100390001-6
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 24
• Document Creation Date: December 22, 2016
• Document Release Date: April 26, 2011
• Sequence Number: 1
• Publication Date: August 9, 1985
• Content Type: REPORT

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Directorate of
Intelligence MASTER
FILE COPY
Da NOT 'GIVE OUT
OR MARK 014
Africa Review
9 August 1985
Seeret
37
ALA AR 85-018
9 August 1985
Copy 3 5 7
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Africa Review) 25X1
9 August 1985
The government is facing a major task of providing suitable housing
for newly urbanized blacks to alleviate a critical shortage that is
25X1
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aggravating political and social unrest.
The rigid ideology, confrontational attitude, and controversial
tactics of the Azanian Peoples Organization is provoking political
violence with rival black groups that is weakening the antiapartheid
movement.
Sao Tome: Fragile Turn Toward Moderation) 11
remain poor.
President da Costa's regime is demonstrating some economic
flexibility and more pragmatic domestic and foreign policies, but
prospects for genuine reform and a significant turn toward the West
Angola: Preparing for the NAM Meeting
West Africa: ECOWAS, Discord
Gabon: Followup on Coup Plot F-~
Malawi: Government Purges Continue
Seychelles: Oil Company Expropriated
Zimbabwe: Budget Problems
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Articles have been coordinated as appropriate with other offices within CIA.
Comments and queries regarding this publication may be directed to the Chief,
Production Staff Office of African and Latin American Analysi 25X1
25X1
Secret
ALA AR 85-018
9 August 1985
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South Africa:
A Crisis in Black Housing
The shortage of low-cost housing for urban blacks has
grown to critical proportions, and is aggravating
political and social unrest.' A rapidly urbanizing
black population has overwhelmed government efforts
to limit their numbers and forced Pretoria to accept
urban blacks as a permanent feature of South African
society. The government, however, now faces a major
task of providing suitable housing for millions of
newly urbanized blacks by the end of this century.
25X1
Black Urbanization and the Housing Shortage
Pretoria, in our view, has recognized belatedly that
the migration of blacks from rural to urban areas is
an almost inevitable byproduct of economic
development. Orthodox apartheid theory had treated
urban blacks as temporary workers in white areas who
would return to the black homelands periodically and
had sought to minimize the need for black labor.
Blacks, however, have evaded controls over their
migration in the hope of finding jobs in white urban
areas and escaping the grinding poverty of the
homelands and the reduced demand for black labor on
white farms. President Botha finally acknowledged
the permanency of urban blacks in a speech opening
Parliament last January. Although Botha has pledged
to revise the so-called influx laws that regulate the
movements of blacks, he is determined, in our view, to
avoid new unplanned shantytowns cropping up near
urban areas. 25X1
South Africa is searching for new methods of
controlling black urbanization.to minimize the related
social, economic, and security problems, according to
press reports. The present system, based on passes and
arbitrary criteria for legal residence in black
townships in white areas is cumbersome, poorly
enforced, and resented by blacks.' Even a black
regime in South Africa would have to deal with
urbanization problems, but, for the white leaders in
Pretoria, these concerns are exacerbated by a fear of a
black uprising. F_~
Pretoria appears committed to a new policy that
requires a job and a house, rather than legal status,
for blacks living in urban areas, according to press
reports. Many business and academic leaders in South
Africa support this approach. In our view, the new
system is potentially more rigid than the old, as a
continued shortage of houses and jobs will result in de
facto influx control.
Addressing the housing shortage also has-important
sociopolitical implications. Embassy reporting
indicates that frustration over the availability, cost,
and location of government-approved housing has
often been a source of black unrest. On the other
hand, the magnitude of the projected black housing
shortage makes resolution of the problem an
expensive proposition. Based on black population
growth trends and expected rates of urbanization,
over 2 million housing units will have to be built at a
cost of some $50 billion in the next 15 years just to
keep the shortage from becoming more severe,
according to South African academic studies. F_
' Current influx control law provides that no black may remain for
more than 72 hours in a "white area," (including black townships
near "white" cities) unless he or she: (1) has resided there
continuously since birth; or (2) has worked there continuously for
one employer for 10 years, or has resided there lawfully and
continuously for 10 years and is employed there; or (3) is the wife,
unmarried daughter, or son under the age of 18 years of a black in
one of the above categories who after lawful entry resides with him;
or (4) has been granted special permission to be in the area (usually
on a one-year contractual basis). According to government figures
in February 1985, some 4 million blacks have earned permanent
urban residential rights. F___-]
Secret
ALA AR 85-018
9 August 1985
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The housing crisis in South Africa began at the turn of the century.
Since that time, the South African Government has responded only
when housing conditions have deteriorated to such a level they are
perceived as a threat to the well-being of the wider community.
1901 The first "native location" of Uitvlugt was only
established as a result of the outbreak of bubonic
plague in Cape Town. Other townships were
created in response to appalling conditions in
squatter camps.
1955 Black home ownership was first introduced
under the 30 year leasehold program.
1968 Thirty-year leasehold program discontinued to
discourage black urbanization.
1976 Thirty-year leasehold program reinstituted in an
attempt to avert township unrest.
1978 Ninety-Nine year leasehold program for black
homeowners established.
1981 Government announces that it will permit sale of
privately constructed houses by whites to blacks
in urban townships.
Vilfoen Report released, calling for: (1)
acceptance of urban blacks as permanent
residents and involvement of public and private
sectors with blacks in housing problems; (2)
subsidization of the individual rather than the
housing unit; (3) provision of adequate number of
serviced lots; and (4) education program to
convince urban blacks of the benefits of home
ownership.
Proposed rent increases spur violence in Durban
township of Lamontville.
Government announces home sale program,
Offering 500,000 government-owned rental units
for sale at up to 40 percent discount.
Riekert Report released, calling for revision of
influx control based on approved housing and
employment.
Moratorium on forced resettlement of black
communities.
Crossroads shantytown to be upgraded, not
destroyed; some residents will be allowed to
remain.
Plans abandoned to move five black townships
from "white area" of Natal Province to "black
homeland. "
Blacks with 99-year leasehold rights to become
eligible for freehold rights.
Plans abandoned to move to homelands all black
townships within 50 kilometers of a homeland.
Pretoria's Evolving Housing Policies
Current government housing policy emphasizes
cooperation between public and private sectors,
promotes home ownership, and makes some provision
for blacks to build their own homes:
? Pretoria has encouraged the establishment of
savings and loans that specialize in financing black
housing.
? Home ownership is encouraged through renewable
99-year property leases that allow blacks, in effect,
to own land in parts of South Africa that had been
reserved for whites. President Botha has announced
that these leases will be converted to ownership.
? Self-help schemes have been designed to allow
blacks to obtain their own housing (consistent with
building codes), either by constructing the homes
themselves or obtaining private financing and
construction. The government provides surveyed lots
with access roads, water, and sewerage.
? In 1983 Pretoria launched a program to sell 500,000
government-owned housing units to their occupants,
usually for as little as $1,000 each. F_~
Despite these initiatives, a fundamental split still
divides the government and urban blacks. In
particular, while Pretoria has insisted on maintaining
stringent building codes so that major new projects
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Table 1
The Housing Shortage: 1980-2000
Additional Number of Persons To Be Housed
Whites Coloreds Asians Blacks Total
Additional Number of Dwelling Units Needed
Whites Coloreds Asians Blacks Total
1980-90 99,000 108,000 30,000 988,000 1,225,000
1990-2000 100,000 105,000 59,000 1,226,000 1,858,000
Assumed Average Number of Persons per Dwelling Unit
Whites Coloreds Asians Blacks
Table 2
Number of Black Homeowners
in South Africa
Number of Registered
30-Year Leaseholds
Number of Registered Totals
99-Year Leaseholds
Home Sale Other
Program 99 Year
will not become slums, blacks believe that the technical issues such as new financing, construction
regulations only make housing more expensive, materials, and township layout. Blacks, however, have
according to Embassy sources. An average of 96 demanded secure tenure, shorter distances from job
percent of urban blacks cannot afford to participate in centers, and participation in decisionmaking. The
the cheaper self-help schemes in white areas, wide gap between black and white concerns is clearly
according to a private South African study. Less than
1.25 percent of the total black population own their
own homes. The government has concentrated on
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Crossroads and Khayelitsha
The Crossroads shantytown has served in the last
decade as a symbol of the determination of blacks to
reside in urban areas despite Pretoria's influx control
laws and resettlement program. The squatter
complex arose in 1975 as a result of the acute
housing shortage for blacks in the area. The
shantytown became a magnet for many blacks in the
impoverished Ciskei and Transkei homelands
because it was located only 23 kilometers from the
center of Cape Town where jobs might be found.
Similarly, the number of "illegals" in three nearby
black townships-Langa, Nyanga, and Guguletu-
grew rapidly. 25X1
Initial government efforts to resolve the situation
proved useless. The residents of Crossroads refused
to leave despite repeated bulldozings of their
makeshift homes. A government scheme in 1979 to
provide housing at "New Crossroads "for all those
who had been in the area since the previous year fell
through due to a lack offunding and the realization
that the project would not meet the overwhelming
demand in the area. 25X1
The latest government plan, announced in 1983,
involves the construction of a new township called
Khayelitsha (Our New Home). Initially, Pretoria
intended to move the residents of Crossroads and the
three nearby townships-some 250,000 blacks in
all-to Khayelitsha, but met with fierce black
opposition. Many blacks residing illegally in
Crossroads demanded urban residential rights before
they would move to Khayelitsha. Others were
reluctant to make the move because:
? They would be required to pay about $10 a month
for their new house (versus no rent at Crossroads),
and transportation costs would increase as
Khayelitsha is 12 kilometers farther from Cape
Town.
? Khayelitsha is in a desolate area consisting almost
entirely of white sand.
? The "core houses" at Khayelitsha are smaller than
many of the shacks at Crossroads. Most of the
4,700 houses built in Khayelitsha as of March 1985
are divided into three small rooms-bathroom,
kitchen, and living room/bedroom-with a total
area of only about 28 square meters. There is little
space for furniture or even for a large black family
to sleep. The owner is expected to build on one or
two extra rooms using approved building materials
and government counseling, but at a personal
expense of about $200 a room. The houses have no
floors or ceilings.
Following violence in Crossroads this spring, the
government decided to compromise. Riots broke out
at Crossroads in February after hundreds of
government personnel approached the area. Pretoria
later claimed that the personnel were there only to
assist blacks who wanted to move to Khayelitsha, but
residents believed it was a "removal squad. " At least
18 residents were killed and over 250 injured in the
melee. The government responded by announcing
that:
? Crossroads would be upgraded rather than
destroyed.
? Illegal squatters would be allowed to live and work
in Cape Province for at least 18 months if they
agreed to build their own homes on `site and
service "facilities-concrete slabs with water
faucets-to be set up on the outskirts of
Khayelitsha.
? Guguletu, Langa, and Nyanga would not be
relocated. F
Pretoria has temporarily defused the Crossroads
situation, but it may have difficulty completing
Khayelitsha because of the huge costs involved. Some
50,000 illegal blacks-about half of the total
population of Crossroads-agreed to move to
Khayelitsha in April. Plans call for Khayelitsha to
have 40,000 houses, 15 site and service facilities, and
a population of over 250,000 by the year 2000,
according to the US Embassy. The first 5,000 core
houses built already have cost the government almost
$50 million-or about 60 percent of the total black
housing budget for 1984/85. The government also has
promised to build a rail link to Khayelitsha and to
subsidize bus fares to Cape Town. In addition, plans
for Khayelitsha include tarred roads, electricity, 13
primary schools, four high schools, nursery schools, a
hospital, a health clinic, sites for churches, sports
stadiums, supermarkets, stores, police stations, a
library, and restaurants.
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Secret
illustrated in the Western Cape, where black
squatters have shown a reluctance to move from a
shantytown that they built near Cape Town
(Crossroads) to a government-planned community
much farther away (Khayelitsha).'F__-] 25X1
Implementation of the emerging housing policy has
been hampered by uncertainty over government
intent, bureaucratic inefficiency, and a continuing
tendency to build homes that are beyond the financial
reach of most urban blacks, according to press
reports. Moreover, the administrative boards now
responsible for disseminating housing information had
helped in the past to enforce the more rigid housing
and urbanization policies, making them suspect in the
eyes of many disaffected blacks
Outlook
The housing crisis in South Africa, in our view, will
not disappear because a housing policy on a scale
sufficient to meet the demands of population growth
and the rate of urbanization is unlikely. Large-scale
housing projects could meet the physical requirements
for blacks, but they lack the social unity of many
squatter settlements. We believe that the lack of
social cohesion in many formal townships raises the
level of both social unrest and endemic violence.
Although Pretoria probably recognizes that the
housing shortage contributes significantly to the
current unrest in South Africa, the country's 25X1
economic difficulties inhibit an effective response.
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South Africa: The Role
of AZAPO
The growing friction between rival black groups has
been a contributing factor in the alarming escalation
of township violence, which-according to South
African statistics-has claimed more than 100 lives
since March. The Azanian Peoples Organization
(AZAPO) has been the target of both organized
attacks and mob violence, and has retaliated against
its rivals in the black townships of Transvaal and
Cape Provinces. Despite repeated attempts by black
religious and community leaders to halt the fratricidal
strife, we believe AZAPO's rigid ideology,
confrontational attitude, and controversial tactics will
continue to antagonize its rivals and provoke political
violence that weakens the antiapartheid movement.
Background
The roots of AZAPO's difficulties lie in the formation
of the black consciousness movement. In 1959, young
radicals in the African National Congress (ANC),
disillusioned with the influential role played by white
Communists as well as by the ANC's Ghandi-style
civil disobedience tactics, broke away from the ANC
and formed the Pan-Africanist Congress (PAC),
urging greater militancy, anti-Communism, and
racial exclusivity. Although both the ANC and PAC
were banned in the early 1960s, the rift between the
"Congress" and "black consciousness" groups has
continued among South African exiles, within the
black townships, and in the antiapartheid movement.
Black consciousness is defined by its principal
theoretician Steve Biko as the resistance to the
dehumanizing and demoralizing influences of
apartheid. Liberation from the psychological effects
of apartheid was seen by Biko as an essential
precondition for liberation from the physical and
political aspects of apartheid. According to black
consciousness ideology, blacks must build dignity,
confidence, and assertiveness in order to resist being
coerced into accepting apartheid.
Black consciousness attempts to unify all sectors of
the black population, "blacks " being defined as those
who are politically, economically, or socially
discriminated against in South African society. Black
consciousness leaders contend that all "black"
groups must pursue their liberation from outside the
system. They believe freedoms granted or sanctioned
by the white system implies black inferiority and
stress that white participation in the struggle for
liberation can only have a dilutive and divertive effect
upon black efforts. Biko and other black
consciousness leaders maintained, however, that
whites can play a role in helping to conscietize the
white community to the coming changes in South
African society, but blacks must liberate themselves.
25X1
In the early 1970s, Steve Biko, a charismatic black
community organizer, formulated a modern black
consciousness ideology that attracted wide attention
in the black townships of South Africa. While never
eclipsing the stature of the underground ANC, black
consciousness groups soon gained considerable
influence in the antiapartheid movement. By 1977,
however, the black consciousness movement was all
but decimated by Biko's death while in detention, the
banning of black consciousness organizations, and the
imprisonment of many of their leaders. F_-]
AZAPO's Role in Black Politics
AZAPO was organized in 1978 in an attempt by the
few unimprisoned black consciousness leaders to
rebuild the movement. In the early 1980s, an influx of
released political prisoners, notably Neville Alexander
and Saths Cooper, steered AZAPO leftward into a
Secret
ALA AR 85-018
9 August 1985
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Neville Alexander, a Cape Town educator
imprisioned in the 1960sfor his role in the Unity
Movement, is perhaps the foremost ideologue in the
black consciousness movement. He believes that most
of the past mistakes of the antiapartheid movement
can be blamed upon weak or nonexistent ideology.
His conviction that ideology is the essential key to
black liberation is largely responsible for the
preoccupation AZAPO displays with ideology.
Saths Cooper, one of nine leaders of the South
African Students Organization imprisoned following
the 1977 crackdown on black consciousness groups, is
presently deputy president of AZAPO. A strong
influence on AZAPO strategy and tactics, Cooper
played an important role in the founding of the
more rigid, Marxist interpretation of black
consciousness that placed it in direct opposition to
other black political movements. In our view, the
decision to release Alexander and Cooper was
apparently part of a broader government strategy to
allow AZAPO to strengthen its position in the
townships in order to counter growing support for the
ANC and the United Democratic Front (UDF), a
multiracial federation of antiapartheid organizations.
25X1
According to academic studies, AZAPO now has
approximately 20,000 members organized in 85
chapters, and wields considerable influence among
black consciousness student groups, community
organizations, and labor unions throughout the black
community. A relatively aloof participant in black
politics, AZAPO resists cooperation with other
groups, even on issues that it supports, such as
25X1
Political Ideology. AZAPO has redefined its black
consciousness ideology linking class with race in a
pseudo-Marxist analysis defining capitalism as the
tool used by whites to implement apartheid. Another
controversial part of this concept is that whites-no
matter how well intentioned-should not participate
in the antiapartheid struggle. AZAPO's position on
ideological issues has isolated it in the black
community. For example:
? AZAPO has openly attacked Zulu Chief Gatsha
Buthelezi's Inkatha organization for its solid Zulu
ethnic base and its public support of negotiations
with the government. AZAPO believes that tribal
distinctions and negotiations work to strengthen
apartheid rather than weaken it.
? AZAPO's relations with the UDF also have been
strained by debates over ideology. AZAPO has
stated publicly that the UDF's strategy will lead the
black majority into a "political ambush." AZAPO
asserts that "one man, one vote" will not truly
liberate blacks because the means of production
would still remain in white hands.
We believe AZAPO's extreme interpretation of black
consciousness has severely limited its appeal. Its
narrow definition of class and ethnicity classifies
middle-class Indians, Coloreds, and Africans as
impediments to revolution. Furthermore, the sheer
complexity of AZAPO's ideology has been a
constraint on the recruitment of working-class blacks.
Organization. In 1983, AZAPO organized the
National Forum, a loose alliance of approximately
100 black consciousness groups. This political
coalition, however, had much less appeal in the black
townships than the UDF. According to journalists
familiar with South African politics, AZAPO and the
National Forum have gained a reputation as "talking
shops." The US Embassy and South African
journalists believe that the National Forum probably
has less than 100,000 members, and that many of its
constituent organizations have chosen either to
support the UDF or have become politically defunct.
We believe AZAPO's tactics are a major factor in its
declining popularity. Extreme ideologists within
AZAPO have prefered not to allow the National
Forum to evolve into a political party. Furthermore,
AZAPO has refused to seek alliances with other
antiapartheid organizations, choosing instead-
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according to both US Embassy and press reports-to
critique their performances and snipe from the
sidelines. F__1 25X1
AZAPO and the UDF at Odds
The widely reported AZAPO demonstrations against
the visit of Senator Kennedy in early 1985
embarrassed the UDF leadership, according to press
and US Embassy reports. This spring, AZAPO
publicly charged that the UDF was acting irrationally
and was condoning violence against blacks in the
townships. Those charges intensified anti-AZAPO
sentiments among the rank and file of the UDF and
contributed, we believe, to the current round of
violence directed against AZAPO members in the
black townships. US Embassy reports indicate that
UDF suppporters, especially in the Eastern Cape,
believed AZAPO's charges divided the black
community and benefited the white authorities.
of the killings.
In May and June, press and Embassy reporting noted
numerous instances where UDF supporters killed and
injured local AZAPO organizers and their families.
In our view, the apparently spontaneous nature of
much of the violence suggests that political as well as
ideological and tactical differences contribute to the
friction between antiapartheid groups. US Embassy
sources speculate that the growing climate of violence
in the townships of the Eastern Cape and the fact the
South African Government's arrest of senior UDF
leaders had allowed local-and more radical-leaders
to take matters into their own hands were also causes
remain a target of attacks from rival groups.
The AZAPO/UDF strife in the townships has been
intensified by deteriorating economic, social, and
political conditions that have fed the spiral of
violence. We believe increasing numbers of UDF
supporters identify AZAPO as an enemy and need
little or no excuse to act against it. While talks
between AZAPO and the UDF sponsored by senior
clergymen and community leaders have temporarily
ended this violence, it appears likely that AZAPO will
Outlook
We believe that AZAPO-unwilling to soften its
ideology or curtail its confrontational tactics-will
remain relatively isolated, plagued by limited mass
appeal and hostile relations with other groups. In our
judgment, AZAPO will continue to be a divisive
factor in township politics. Such developments can
only make AZAPO's stated goal of black unity more
elusive, and increase the likelihood of government
action against AZAPO and other groups.
Without a government ban on black consciousness
movements similar to that enacted in 1977, the high
number of hardcore political ideologues in the
movement's leadership make an AZAPO collapse
unlikely over the near term. As long as the group
continues to generate more problems for the
antiapartheid movement than for the government,
Pretoria may not feel compelled to take such action.
AZAPO's rigid ideology, political goals, and
willingness to engage in confrontation could make it a
more competitive force should township violence
continue to escalate. Moreover, a decline in the
fortunes of the UDF, an event we see as unlikely but
possible if the government becomes convinced that the
UDF is serving as a proxy in the ANC campaign to
generate unrest, could give AZAPO the leadership of
the antiapartheid movement by default.
25X1
25X1
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Sao Tome and Principe
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Sao Tome: Fragile Turn
Toward Moderation F_
Sao Tome, which established close ties with the Soviet
Union and its allies after winning independence from
Portugal in 1975, has begun to demonstrate some
economic flexibility and slightly more pragmatic
domestic and foreign policies in the past year,
according to the US Embassy. In our view, President
Manuel Pinto da Costa's 10-year-old regime is
looking to the West as an alternative to the Soviet
Bloc, which has failed to provide sufficient levels of
aid to stem the steady economic decline. We believe,
however, that the longer term prospects for genuine
reform and a foreign policy shift toward the West
remain poor. Sao Tome has not closed its doors to the
Soviets and their allies, and da Costa has a track
record of temporarily moderating policies withovt
introducing significant reforms. F----] 25X1
Located 125 miles off the coast of Gabon and 600
miles northwest of Angola, Sao Tome is one of
Africa's most remote and isolated countries. During
some 500 years of colonial rule, Lisbon committed
few economic resources to the islands. Yet, Sao Tome
was the only Portuguese colony not to mount a
prolonged armed struggle for independence. In 1972
the Movement for the Liberation of Sao Tome and
Principe (MLSTP}-now the name of the sole
political party-launched its independence campaign
from neighboring Gabon. The downfall of Portuguese
Prime Minister Caetano in the April 1974 coup
stirred demonstrations and strikes against Portugal,
and in 1975 da Costa-the MLSTP's leader since
1972-became the country's first president. Fearing
reprisals, the Portuguese plantation administrators,
civil servants, and traders fled prior to independence.
Ties With the Communist States
Da Costa began his rule by adopting a relatively
isolationist foreign policy and socialist domestic track.
Ideologically, his government identified itself with
Marxist principles and the President forged close ties
with the USSR, Eastern Europe, and Cuba in the
1970s. According to US Embassy reporting, da Costa
nationalized the 15 Portuguese plantations that
produced about 90 percent of the country's cocoa and
established state control over the small private sector.
Soviet Ties. Sketchy US Embassy reporting suggests
Soviet-Sao Tomean relations are fairly warm.
Moscow provides all but routine maintenance on two
unsophisticated radar sites that monitor approaches
from mainland Africa. The US Embassy reported last
year that some 20 Soviet military and 100 civilian
advisers serve on the islands. The Embassy notes da
Costa visited the USSR in 1976 and 1982, and that,
following his concerns about a mercenary attack in
1978, the Soviets dispatched two warships as a
gesture of support.
While the USSR so far has displayed only a limited
interest-it provides no economic aid-Moscow may
recognize Sao Tome's potential military utility,
especially in the unlikely event that it loses its limited
air and naval access in Guinea. Moscow probably
would find it easier to subsidize Sao Tome's small
population of 94,000 rather than provide the aid
necessary to woo more populated West African
coastal states. Although Sao Tome's harbor is too
shallow for most Soviet warships, it may appear
attractive to Moscow because it is well protected and
could be deepened. The Soviets also may view the
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country as a potential base for air reconnaissance
operations in the Atlantic, though reestablishing such
operations-cut off by Guinea's Sekou Toure in
1977-has not been a high priority for Moscow over
the last few years. We note that Sao Tome served as a
staging point from 1967 to 1970 for supplies and
journalists going to Nigeria during the civil war.F_
We do not believe the Soviets would sit idly by should
da Costa vigorously pursue a Westward course. The
US Ambassador in Gabon reports that Soviet
Embassy officials had met earlier in the year to
discuss a political strategy, possibly to forestall
further Western-oriented economic reforms.
Moreover, Soviet Bloc advisers serving in the Ministry
of Planning and other key posts probably exert some
influence and slow such moves.F 25X1
Cuban Relations. The US Embassy reports Havana
and Sao Tome have maintained close military ties
since the 1970s. By 1978 some 50 to 100 Cuban
military advisers were in the country, as well as an
unknown number of doctors and economic
technicians. In the late 1970s Cuba reportedly used
Sao Tome as a rest and recreation facility and may
still use it as a transit point for their personnel
stationed in Angola. The Embassy reports that Cuban
military advisers continue to play a key role in the
development of the Sao Tomean Army. Cuba is
training da Costa's presidential guard, which the
Embassy estimates at some 100 men. The US
Embassy also reports that da Costa asked Havana to
establish a 300-man Cuban presidential guard last
year, but we have no evidence to indicate they have
done so. According to unconfirmed Embassy
reporting, da Costa had an unknown number of
Cuban bodyguards in the 1970s.
The US Embassy believes Havana has forged
considerable influence in the educational system.
Cuba is thought to be attractive to many Sao
Tomeans since their government cannot afford to
build a university or to pay the high costs of most
Western schools. According to Cuban press reports,
some 300 Sao Tomeans study in Havana. Although
Embassy reporting from time to time suggests Sao
Tomean disillusionment with Cuba's educational
aid-for example, Cuban instructors are said to have
minimal training-we see no evidence da Costa will
request their departure. The US Embassy also
observes Cuban officials serve in the Ministry of
Planning as well as in other government posts, and
Cuban advisers are developing the party organization.
East Germany. US Embassy reporting indicates that
East Germany has provided an undetermined amount
of economic aid and advisers since 1975. Da Costa,
who received a doctorate in economics from
Humboldt University in East Berlin and whose
daughter attends school there, visited the GDR in
1977 and 1982. Economic and technical agreements
were signed in 1978 and 1982, and last year a new
commercial agreement was signed.
Angola. Angola has been Sao Tome's closest ally since
1978, when Luanda acceded to da Costa's request for
military protection against South African-backed
mercenaries, whom he believed planned to overthrow
him. By the end of the year Angola had dispatched
some 1,000 troops to the islands, ostensibly as a sign
of Lusophone solidarity. The Angolan military
presence has since been reduced from about 1,500 in
1983 to some 400 to 600 as of last year. The Embassy
reports the Angolan cuts were made for economic
reasons. Angola's domestic security problems and the
critical need to strengthen its forces fighting UNITA
insurgents probably were factors in the decision to
reduce the contingent in Sao Tome. Angola provides
Sao Tome with all its petroleum products and is its
main source of cement, fish meal, corn, and wheat
flour.
Improving Relations With the West
The US Embassy reports that, in an effort to improve
relations with the West, Sao Tome has pledged to
pursue a nonaligned foreign policy, and indicated it
would not permit the establishment of Soviet military
facilities if Moscow requested them. According to the
Embassy, da Costa declined a Soviet request for a
naval visit last year and asked the Cubans to reduce
their presence in order to demonstrate his moderate
intentions.
France. The US Embassy reports that da Costa's visit
to Paris in 1983 highlighted Sao Tome's close ties to
France, the country's largest economic aid donor.
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Paris provides Sao Tome with about $10 million per
year, and Sao Tome has expressed interest in joining
the African franc zone. We agree with the Embassy
that Paris probably is trying to prevent Moscow's use
of Sao Tome as an alternative site for air and naval
access that the Soviets now enjoy in Angola and
Guinea. By providing aid, France also seeks to protect
the neighboring moderate states of Gabon and
Cameroon, in which Paris has significant commercial
and political interests.
Portugal. The US Embassy reports Sao Tome has
sought a rapprochement with Lisbon, following
several years of strained relations during which time
da Costa accused Portugal of trying to overthrow him.
Da Costa welcomed military ties with Portugal
following President Eanes's visit to Sao Tome last
year. The Embassy reports that Lisbon now provides a
small amount of nonlethal military aid and has agreed
to train 10 to 12 Sao Tomeans. Moreover, Sao Tome
asked Portugal to revise its school curriculum, which
was previously an enclave of Cuban dominance. Press
reports indicate that Portugal inaugurated a monthly
flight to the islands last year.FI 25X1
The United States. The da Costa government has
initiated several steps to foster better relations with
Washington, the US Embassy reports. In the last
year, Sao Tome has reduced its anti-US rhetoric in
international forums, refused to condemn US
intervention in Grenada, welcomed for the first time a
US naval port call, requested a US military
cooperation agreement, and is setting up a private
investment code to encourage US and Western
investment.
US interests in Sao Tome are limited to preventing
the islands from being used as a base for destabilizing
moderate regimes in the region and to deny Soviet
military access. Over the last two decades, Guinea's
naval and air facilities have aided Soviet surveillance
of Western naval forces in the south Atlantic and
Soviet military support of Angola's regime. US
Embassy reporting also indicates that Moscow would
like to establish alternative installations-possibly
Sao Tome-to ensure air and sea access to west and
central Africa. US leverage is very limited-minimal
trade ties exist and there is no private US investment.
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Economic Pressures for Greater Pragmatism
Onerous government intervention has left the
economy in a shambles, according to the US
Embassy. The World Bank reports that real GDP
grew an average rate of only 1.2 percent from 1970 to
1981, and that without a rescheduling the debt service
ratio will reach 70 percent by the end of the decade.
US officials report widespread food shortages, as
people subsist on a diet of bananas, papayas, and rice.
Laborers are dispirited-lacking the incentive to work
hard-and the US Embassy reports a serious shortage
of skilled workers and managers.
Previous attempts at economic reform have failed.
Ten years after the government declared economic
diversification a key goal, the cocoa sector still
provides almost 90 percent of foreign exchange
earnings, according to the US Embassy. The outlook
for Sao Tome's cash crops remains poor, with cocoa
earnings likely to decline due to low producer prices,
slack international demand, and declining production.
Efforts to boost other exports-coffee, palm kernals,
and copra-have been unsuccessful. The growth
potential in the small industrial sector-beer, soft
drinks, and soap production-also is limited because
of a small domestic market and a shortage of locally
produced raw materials. F_~
The government must introduce significant reforms
before real economic growth is possible. The US
Embassy reports that Sao Tome has introduced some
measures to promote private enterprise, such as
allowing farmers to sell their surplus production, and
removing a ban on private ownership of pigs. The
government also has sought to promote foreign
investment and tourism. These changes, however, are
not sufficient, in our view, to pull Sao Tome's
economy out of its prolonged slump. F_~
The Domestic Climate
The US Embassy reports that da Costa appears to be
in firm control. He rarely delegates power to his
colleagues and periodically removes from the regime
those he believes are potential threats to his rule. Da
Costa draws heavily on Marxist-Leninist principles,
although Sao Tome is not formally a Marxist state.
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The US Embassy reports that a pervasive party
organization exists and that party membership is
necessary for upward mobility in government. The
2,000-man military is reported to have ideological
officers who serve as watchdogs attached to most
units. According to the Embassy, the government
reportedly maintains an effective network of loosely
organized informants, and the security service can
keep good track of people without being obtrusive
because of the island's small size.F___1 25X1
significantly in the near term.
Nevertheless, in recent months da Costa has
appointed some moderates to office. The US Embassy
reports he has brought young, Western-educated
technocrats into the Foreign Ministry and key
economic positions. Moreover, the Embassy indicates
the Defense Minister-once regarded as a Marxist-
is now thought to be Western leaning. We note,
however, that these officials lack the experience and
political base to moderate da Costa's Marxist policies
to demonstrate his moderation.
According to the US Embassy, da Costa also has
made overtures to Gabonese-based exiles in an effort
subsidize Equatorial Guinea's entry into the franc
zone, and may be reluctant to pay the heavy costs of
Sao Tomean membership. Moreover, international
lending institutions are likely to stall further loans
until Sao Tome introduces more comprehensive
economic reforms.
Nevertheless, the moderating trend will benefit US
interests so long as it continues. Sao Tome's need for
bilateral economic aid, support from international
lending institutions, and Western trade and
investment may enhance US leverage to some degree.
In return for greater Western support, Sao Tome is
likely to continue to experiment with free market
Western principles, implement limited reforms, and
keep diplomatic relations with key donor countries on
an even keel.
In any case, we believe da Costa will retain close ties
with the Soviet Bloc for the near term. Our US
Ambassador concludes da Costa "does not want to
burn his bridges" with the USSR and Cuba should
the West fail to provide the expected aid. Da Costa
may use the exile or mercenary "threat" to justify the
continued presence of East Bloc personnel. Moreover,
should da Costa feel his political position threatened,
we cannot rule out the possibility of his requesting
Cubans to help support him. The Angolan
Government-possibly acting on Moscow's urging-
could exert pressure to prevent the da Costa regime
from moving Westward.
Outlook
In our view, Sao Tome's tentative Westward shift-
designed to attract badly needed Western credits and
technical assistance-is fragile and could be easily
reversed. We believe that Sao Tome may be
disappointed with what it perceives as less than
generous Western aid, and could sour on the benefits
of closer ties to the West. Da Costa probably harbors
unrealistic expectations of European and US aid and
investment over the next several years. In our view,
Sao Tome is unlikely to win significant new aid at the
Western donors' conference to be held this fall. We
note that Paris has found it very expensive to
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Africa
Briefs
Angola Preparing for the NAM Meeting
The dos Santos regime is trying to ensure that the 2-7 September Nonaligned
Movement Ministerial meeting in Luanda is a political success and takes place
without incident. Most foreign observers, however{
supplies imported for the conference.
believe government preparations will not
prevent UNITA from acting during this period. there is
speculation among the foreign community in the capital that UNITA will mount
attacks in Luanda and against a provincial target in an effort to embarrass the
regime. UNIT may have set fire to the
government's main warehouse in mid-July, destroying some $3 million worth of
Estimates of how much Luanda is spending on the affair-including the increased
security-vary from $30 million to $50 million. Security is being tightened in a 30-
kilometer radius around the capital and defenses are being strengthened at the
airport, major highways, the port, and other strategic points.
organization solvent.
While the goal of a regional economic organization was enough to bring 12 of the
16 member Heads of State together last month for the annual meeting of the
Economic Community of West African States (ECOWAS), practical problems
and longstanding disagreements prevented an significant achievements.0
inadequate funding is creating
serious day-to-day operational problems for the organization. According to the US
Embassy in Lome, only $2.6 million of this year's $6 million budget has been paid
in so far this year, and the Secretariat appears unwilling to pressure member states
to bring their subscriptions up to date. Most states are unable to pay their annual
membership dues all at one time, but small, incremental payments could keep the
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The leaders also failed to achieve breakthroughs on such issues as coordination of
economic policy, commercial integration, currency exchange, and greater financial
contributions. Although the delegations demonstrated greater concern for regional
economic problems, the US Embassy in Lome reports that the members remained
highly nationalistic and divided. Debate also focused on IMF and World Bank
policies, which were strongly- criticized but not rejected in principle. Nevertheless,
the Heads of State did succeed in advancing the second phase of a protocol on Free
Movement of Peoples and Residency, which would allow foreign nationals
indefinite residence and the right to open businesses in any member country. The
protocol, favored by all except Nigeria, takes effect on 5 June 1986 and must be
renewed after four years.
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A two-month investigation into the aborted coup plot last May revealed that it was
an individual act that did not compromise the integrity of the armed forces,
according to our Embassy.
Embassy.
Captain Mandja, the mastermind of the plot, to death while two other officers
were acquitted. Armed Forces Inspector General Reonigneaud has been accused
of knowing of the plot and not reporting it to the authorities, according to the
The Embassy reports that a court-martial sentenced Army
While President Bongo is in full control of the country, he has traditionally
mistrusted the military. Although the results of the investigation may have allayed
his fears temporarily, Bongo is likely to remain concerned that many of those
questioned were members of his own Bateke tribe, who fill key positions and
comprise the bulk of the 1,600-man presidential guard. Moreover, discontent
among junior Army officers and enlisted men, who feel Bono ne lects the Army
in favor of the guard, continues to surface occasionally.
neighboring Mozambique.
The fiscal year 1985/86 budget introduced last week features a substantial
increase in deficit spending that is likely to complicate negotiations for a new IMF
standby agreement. Expenditures are set to rise by 18 percent, compared to a
prevailing 10-percent inflation rate. Revenues are projected to increase by 15
percent, primarily on the strength of export earnings and higher foreign aid. The
$512 million deficit represents about 11 percent of projected GDP, well above the
5.5-percent target put in the last IMF agreement. Much of the increased
expenditure is planned to cover aircraft purchases and military support for
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President Banda's anticorruption purge, which began with the ouster of civil
service chief John Ngwiri, has now spread throughout the government. According
to US Embassy reporting, Police Commissioner Itimu abruptly retired last July
and the newly created position of Deputy Inspector of Police was filled by a
political rival of Police Inspector Kamwana, indicating that Kamwana's retirement
is also imminent. We believe that Banda also may purge the Army hierarchy,
although Army General Khanga probably is too powerful to be removed.
Meanwhile, John Tembo, who probably
encouraged Banda to remove Ngwiri, has been appointed head of Malawi's
Commercial Bank. We believe this is the latest step in formalizing Tembo's status
as successor to Banda and we expect the purge, ostensibly aimed at corruption, to
immobilize Tembo's longtime opponents, including Khanga and Kamwana.
estimated $7 million to $12 million in assets.
The Rene regime expropriated a Dutch oil company's local subsidiary, Shell of the
Islands, last month, continuing its program of nationalizing significant private
enterprises. The company held the monopoly for import and distribution of all
petroleum products in the islands. The Seychelles National Oil Corporation, a new
state enterprise, will take over the holdings. According to the US Embassy, the
financially strapped regime is unlikely to compensate Shell adequately for an
measures.
Over the near term, the US Embassy reports that the government's move to
nationalize the country's only source of petroleum has wide-ranging and
potentially serious implications for the economy. It almost certainly has
undermined the confidence of Western investors in the private sector and raises
fears of further nationalizations. In addition, according to Embassy officials,
energy shortages and significantly higher oil prices are likely in the coming months
without Shell's participation in the distribution process. This, in turn, will impact
on tourism and fishing, the mainstays of the economy. Irregular petroleum
deliveries also could interrupt operation of the US Air Force satellite tracking
station, which provides at least 7 percent of the country's GDP. The Embassy
reports that the tracking station has enough fuel stored in its own tanks to operate
for two months under normal use and up to five months through conservation
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