AFRICA REVIEW

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP87T00289R000100380001-7
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 28
• Document Creation Date: December 22, 2016
• Document Release Date: April 26, 2011
• Sequence Number: 1
• Publication Date: July 26, 1985
• Content Type: REPORT

Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Directorate of
Intelligence MASTER FILE COPY
10 NOT GIVE OUT
IR MARK ON
Africa Review
26 July 1985
Secret
ALA AR 85-017
26 July 1985
Copy 3 5 6
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Disgruntlement over austerity measures and rumors of coup plotting
are increasing, but in our view Chairman Mengistu is still in control.
His problems with the economy and the military nevertheless are
likely to increase.
A report on the country's monetary system issued last month by a
government commission calls for a strengthened role for the Reserve
Bank in fighting inflation and charting economic growth. The
recommended reforms made to date on a piecemeal basis, however,
have been offset by the declining exchange rate of the rand, which
has not only accelerated inflation but spurred domestic criticism of
government economic management.
Growing domestic unrest in Djibouti-unless kept in check by more
vigorous leadership by President Gouled-may provide Libya with
attractive opportunities to improve its position in the Horn of Africa.
The government of President Abdallah faces a variety of economic
and political challenges resulting from the Comoros's colonial
legacy, geographic limitations, postindependence power struggles,
and his autocratic style of rule.
i Secret
ALA AR 85-017
26 July 1985
25X1
25X1
5 25X1
25X1
25X1
25X1
25X1
15 25X1
25X1
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7 -
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Secret
West Africa: Narcotics Traffic)
21
Benin: Austerity Measures Provoke Unrest
==
21
South Africa: Controversial Anglican Synod=
22
Malawi: Military Expansion
==
22
25X1
25X1
25X1
25X1
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
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7 -
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Ethiopia:
Mengistu Still in Charge
25X1
disgruntlement over
austerity measures and rumors of coup plotting are
increasing in Ethiopia. In our view, however,
Chairman Mengistu is still in control, although his
problems are likely to increase soon. Addis Ababa
thus far has been able to shield key urban and
military constituencies from the worst effects of
drought and continued fighting. F__1 25X1
his rule.
The Embassy reports that the outlook for economic
recovery remains bleak. We believe the government
probably will be forced to impose further austerity
over the next several months that will irritate the
urban and military sectors. The Army has fared
poorly in its latest campaign against the northern
insurgencies, which is likely to put renewed pressure
on Mengistu. In our judgment, however, Mengistu
will be able to endure for some time by placating
influential groups as much as possible and by relying
on his pervasive security service to contain threats to
New Challenges
Economic austerity measures were extended last
March to the military and officers of the security
service for the first time since Mengistu consolidated
power in 1977. Mengistu has tempered the impact of
these measures-which include gasoline rationing,
elimination of free housing and access to special
stores, and an end to free use of government cars-by
promoting a large number of officers and increasing
their pay, according to US Embassy reporting. We
believe that Mengistu is trying to demonstrate to the
military that it retains special status, despite the
cutback in privileges. 25X1
Defeats at the hands of the northern insurgents may
take some toll on military morale and support for
Mengistu, in our view. Addis Ababa began its latest
campaign against the insurgents last March, but
unlike previous attempts, it confined operations to
Tigray Province and Tigrean-inhabited portions of
Gondar and Welo Provinces, according to the US
Embassy. The offensive apparently was aimed at
securing highways and disrupting guerrilla operations
and logistics. We believe it also was aimed at
stemming the movement of refugees into Sudan,
where some guerrilla recruitment and training occur.
Recent government setbacks, such as in fighting near
Sekota, indicate that the offensive has bogged down
and indeed may have emboldened the rebels to
increase their attacks. The Embassy reports the rebels
in Eritrea have been successful in several significant
engagements earlier this month, including assaulting
the port of Massawa, near Asmara, and Barentu, a
key to Ethiopia's defensive line.
We believe the increased fighting will lead to renewed
pressure on Addis Ababa by those in the military who
favor a political settlement with the northern
insurgencies, including partial autonomy for Eritrea.
Mengistu, nonetheless, remains committed to a
military solution. The Eritreans have rejected
anything less than independence for the province.
Fighting, meanwhile, probably will continue to be
inconclusive and create additional disgruntlement in
the Army. We believe Mengistu, as he has done
previously, would move quickly against anyone
suspected of antigovernment activities; he might even
execute dissidents as an example to other troops.
Although the urban population appears dissatisfied
over declining economic conditions, the US Embassy
reports that there are few political channels for
expressing discontent. The Kebeles, neighborhood
associations dominated by Mengistu loyalists, have
Secret
ALA AR 85-017
26 July 1985
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Secret
GOND,ER
Gander.
\Mek'ele
GANDA
Oolo~.,~'
high Ganane
Ethiopia
--"-? International boundary
???? Province boundary
National capital
O Province capital
-'--'- Railroad
- Road
0 75 150 Kilometers
0 75 150 Milea
\Kass45 Warder
Boundary rePreaentabon u
not neca,a,r0, autlwntahve
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Secret
replaced labor unions and most other institutions in
the cities as traditional forums for discontent.
Although several antigovernment protests have
erupted recently over economic issues, they have been
small and localized. For example,
spectators at a soccer match last
arrested and killed.
May between a military and a civilian team shouted
antiregime slogans and heckled the military team.
Also in May, our Embassy reported that an angry
crowd attacked state-appointed church officials in
Addis Ababa for moving religious articles from a
church to a library. Despite these protests, most
austerity measures have been accepted by the
populace with little more than grumbling by a handful
of protesters. We believe the general public remains
cowed by Mengistu's ruthless reputation and
memories of the "red terror" of 1977-78, when
thousands of civilian opponents of the regime were
makes all significant decisions personally
power through the Kebeles, his pervasive security
service, and his personal control of the military
apparatus. He has been careful to co-opt or remove
potential opponents and, according to the Embassy,
Outlook
We agree with the US Embassy's assessment that
while Mengistu has many vulnerabilities, which over
time could weaken his rule, none pose a serious threat
to him anytime soon. Mengistu continues to maintain
of the cities and resettlement camps.
the government is
cutting back food deliveries to the countryside in favor
constituencies. For example,
that Mengistu will continue to protect his
Disgruntled officers might be tempted to plot against
the government, but we believe the ubiquitous
security apparatus would be able to thwart them.
Although the government may be forced to take even
more draconian measures to deal with the failing
economy-particularly to meet food needs and other
necessities for the cities and the military-we expect
A few leftwing ideologues within the Politbureau-
commonly referred to as the Gang of Four-appear
increasingly to have the Chairman's ear. This group
may be behind the current austerity program, which
is aimed in part at suppressing what remains of the
urban middle class. They probably helped to persuade
Mengistu to develop the Ethiopian Worker's Party,
established last September for the 10th anniversary of
the Ethiopian Revolution, as a potential alternative
power base to the military. Nevertheless, in our
judgment, the ideologues remain loyal to Mengistu
and, in any event, probably do not have enough
military support to seize power. F-I
25X1
25X1
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
South Africa: Implications
of Monetary Reforms
The Commission of Inquiry into the Monetary System
and Monetary Policy of South Africa (the de Kock
Commission) released its final report last month, more
than seven years after the body was created. The
recommendations in the report complement changes
in South African monetary policies that Gerhard de
Kock, chairman of the commission and governor of
the South African Reserve Bank, has been
implementing on a piecemeal basis since 1979.'
Besides streamlining monetary policies, changes
proposed by the commission and already implemented
in part by de Kock are designed to strengthen the
Reserve Bank's role in fighting inflation and charting
economic growth. The impact of the changes de Kock
has made to date, however, has been offset by the
declining exchange rate of the South African rand,
which has not only accelerated inflation but spurred
domestic criticism of government economic
management. 25X1
Monetary Policy Through Controls
South Africa during the 1960s and 1970s relied on
monetary policies that placed direct controls on
financial outflows and interest rates, and set fixed
rates of exchange between the rand and other
currencies by government fiat, according to academic
studies. These sources note that South Africa had
suffered sustained private capital losses during the
late 1950s, which accelerated after the well-
publicized killing of 69 black protestors by South
African police at Sharpeville in March 1960. The
drain on government foreign currency and gold
reserves sparked by this capital outflow induced
Pretoria to resort to a sequence of countermeasures.
In addition to foreign borrowing, Pretoria raised
interest rates, tightened import controls, increased
restrictions on foreign currency purchases by South
African residents, and, finally, extended these foreign
exchange controls to nonresidents. The last of these
measures halted the drain on reserves.
' The Reserve Bank fills roughly the same role in South Africa as
the Federal Reserve Bank does in the United States and other
central banks do in their respective countries. Most of the monetary
reforms cited in this article have already been implemented by
The Reserve Bank implements monetary policy
through its influence over the volume of bank loans
made, the interest rates charged on those loans, and
the exchange rate between the rand and other
currencies. The impact of changes in these variables,
in turn, affects the purchasing power of consumers
and investors in the economy, and thus influences
economic growth, inflation, and the distribution of
employment and output across South African
industries. Debt,-financed consumer purchases, such
as houses, cars, and major appliances, are especially
sensitive to interest rate changes. Similarly, changes
in the value of the rand affect the competitiveness of
domestically produced goods relative to imports.
The Reserve Bank is relatively independent of
political processes in the country, but coordinates its
policies with the government treasury. Bank Governor
de Kock lists the South African central bank as the
third most independent in the world, after the US
Federal Reserve Bank and the West German central
bank, according to US Embassy reports. Treasury
and Reserve Bank coordination, however, is
important because the magnitude and method of
financing government deficits affect the amount of
liquidity in the economy and vice versa
We believe, however, that direct controls also
prompted some adverse consequences. In our view, the
prolonged application of foreign exchange restrictions
removed the natural check on the growth of domestic
purchasing power and contributed to the rise in
inflation rates from 10 percent in 1978 to 15 percent
in 1983. Money that would otherwise have left the
country for investment abroad added to domestic
Secret
ALA AR 85-017
26 July 1985
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Secret
Commission of Inquiry Into the Monetary
System and Monetary Policy of
South Africa: A Chronology
Exchange controls imposed on nonresidents to stem outflow of capital that began after the shootings at
Sharpeville in March 1960; dual exchange rate introduced, effectively penalizing nonresidents
withdrawing funds from the country.
August 1977 The Commission of Inquiry into the Monetary System and Monetary Policy in South Africa (the de
Kock Commission) appointed.
The first interim report of the de Kock Commission is released; recommends moving from fixed
exchange rate system to exchange rate determined largely by market forces, but managed by the South
African Reserve Bank through sales and purchases of US dollars.
March 1980 Many legal ceilings on interest rates abolished.
January 1983 The second interim report of the de Kock Commission released; proposes more market-oriented
monetary policy.
February 1983 Government removes exchange controls on nonresidents and relaxes those on residents; ends dual
exchange rate system.
Reserve Bank begins paying revenue from gold sales to mining companies in dollars rather than rand to
encourage the development of private foreign currency markets in South Africa.
Reserve Bank shifts to paying revenues to mines half in dollars, half in rand in order to increase its
ability to influence exchange rates.
Final report of the de Kock Commission released; proposes gradual phasing out of remaining exchange
controls.
demand. This induced Pretoria to impose additional
regulations in a number of unsuccessful attempts to
stem growing demand. Ceilings on commercial credit,
for example, were instituted to slow lending. This
approach failed because politically sensitive interest
rates, especially those charged to farmers and
homeowners, were kept artificially low. Moreover, the
method of subsidizing loans to farmers, which in
effect treated their debt as an asset against which
banks could make additional loans, increased
purchasing power.
The Market-Oriented Approach
South African officials, led by Reserve Bank
Governor Gerhard de Kock, realized that these
successive layers of monetary controls were increasing
underlying inflationary pressures, according to press
reports. As a result, de Kock and other South African
economists have pushed since the late 1970s for
removal of government controls so that the economy
could adjust automatically through interest and
exchange rate changes to new economic conditions. In
addition, a drop in Western inflation rates since 1980
has raised substantially South Africa's inflation rate
relative to its main trading partners (see figure 2).
Several important moves toward implementing this
market-oriented approach were initiated a few years
ago, beginning with the demise of the fixed exchange
value of the rand in 1979. After a series of
devaluations, South Africa gradually moved to a
"managed float," in which the value of the rand is
chiefly determined by supply and demand. The
Reserve Bank purchases and sells US dollars to
moderate sharp movements in the rand's exchange
value. Pretoria also has lifted many ceilings on
interest rates and bank loans. In 1983, Pretoria
removed exchange controls on nonresidents.
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Gerhard de Kock has served since 1981 as governor of the South African Reserve
Bank, giving him primary responsibility for policies affecting commercial credit
and foreign exchange. He had previously served for 10 years as the Reserve
Bank's senior deputy governor. Regarded in the press as a monetarist who opposes
nonfiscal economic controls, de Kock strongly favors tight budgetary restraints
and slower growth of commercial credit as ways to curb South Africa's high
inflation rate. Although he approves of President Botha's racial reform policies,
according to US Embassy reporting, de Kock has generally avoided involvement
in political issues, stressing the bank's independence. Embassy sources note that
the South African business community holds de Kock in high regard because of
his economic expertise and strong leadership skills. He has an M.A. degree from
the University of Pretoria and M.A. and Ph.D. degrees from Harvard.
According to press accounts, the final report of the de
Kock Commission proposes some additional monetary
reforms:
? All interest rates should be market oriented,
including those charged to homeowners and
farmers.
? Interest paid on home mortgages should not be tax
deductible.
? Special tax benefits enjoyed by savings and loans
that specialize in mortgages should be eliminated.
? Exchange controls on residents should be eased
further as the balance of payments improves.
Residents should be given freer access to investment
opportunities and financial markets abroad.
? Monetary policy should be keyed to targets for
growth of purchasing power. These targets should
not be rigidly enforced, but should serve as
guidelines to make monetary policy more consistent.
25X1
Under the proposed system, the monetary authorities
would set 12-month targets for growth of purchasing
power each February. The primary goal of monetary
policy would be to slow inflation, but with some
attention to the short-term impacts on foreign reserve
holdings and interest, growth, unemployment, and
exchange rates. According to press accounts,
President Botha has approved the commission's
recommendations.2
Short-Term Economic Effects
Gradual introduction of de Kock's market-oriented
approach to monetary policy already has affected
economic performance. The elimination of the fixed
exchange rate for the rand has allowed its value to
float downward from an average of $1.19 in 1979 to
about 52 cents this past week. Although combating
inflation had been one of de Kock's goals in
implementing monetary reforms, in the short term the
declining value of the rand has raised the cost of
imports and increased inflation rates (see table,
"South Africa: Selected Monetary Indicators,
1966-85").
3 Although the appointment last week of Chris Stahl as the new
Director General of Finance has been interpreted by some observers
in South Africa as a signal that Pretoria will move slowly in
implementing new monetary reforms, we believe that President
Botha remains committed to de Kock's market-oriented approach.
Stahl's earlier objections to some de Kock Commission interim
recommendations were based on practical considerations rather
than fundamental differences in approach, according to US
Embassy reporting.F__~
25X1
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Secret
SOUTH AFRICA
CONSUMER PRICE INFLATION
(Year-on-year percentage changes)
Source: IMF, International Financial Statistics.
[Weighted average of industrial countries' consumer price index, with weights based upon 1975 GDP.
2Ratio of the South African CPI index (1975=100) to that of industrial countries, in national currencies.
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
South Africa: Selected Monetary
Indicators, 1966-85
Year/ Price of Exchange Price of Money Treasury Inflation Current
Quarter Gold Rate Gold Supply Bill Rate Account
($/oz) a ($/rand) b (rand/oz) Growth Yield (percent) Balance
(percent) c (percent) d (billion US $)
1972
58
1.30
45
13
4
7
-0.1
1973
97
1.44
65
15
3
9
-0.1
1974
159
1.47
108
23
6
12
-1.5
1975
161
1.37
118
13
7
14
-2.6
1978
193
1.15
168
6
7
10
1.5
1979
307
1.19
258
16
4
13
3.4
1980
613
1.29
477
29
6
14
3.5
1981/1
2
3
4
518
479
421
420
1.30
1.19
1.06
1.04
398
403
397
404
35
40
33
34
7
8
11
12
16
15
16
14
0
-1.6
-1.5
-1.2
1982/1
2
3
4
363
333
380
427
1.01
0.93
0.87
0.89
359
358
437
480
37
24
26
16
15
16
15
11
14
16
14
14
-1.3
-1.3
-0.4
-0.1
1983/1
2
3
4
464
428
410
388
0.92
0.92
0.90
0.85
504
465
456
456
15
30
29
26
12
14
16
18
14
13
12
11
0.8
0.4
0.1
-0.9
1984/1
2
3
4
384
379
345
339
0.81
0.78
0.64
0.55
474
486
540
616
35
27
32
41
18
18
21
21
10
11
12
13
-0.4
-0.3
-0.3
0.2
1985/1
302
0.49
616
33
22
15
0.6
a Average London daily fixing price.
b Average par exchange rate.
c Year-to-year change at end of quarter.
d Provided as a proxy for the prime lending rate, which
varies among banks and for which no readily
available quarterly series was found.
i
I
~
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Secret
South African mining companies, nonetheless, have
benefited from the floating rand. The sharp decline in
its exchange value has boosted local currency earnings
on gold sales, more than offsetting the fall since 1980
in the world gold price. Indeed, whereas the dollar
price of gold has fallen by 50 percent from its 1980
average, the rand price has increased by nearly 30
percent (see table). While the economy as a whole has
suffered from reduced foreign currency earnings as a
result of the lower world gold price, the monetary
reforms have produced profits in the mining industry.
Increased profits, in our judgment, have made it
possible for large South African mining companies
such as Anglo-American Corporation to offer black
mineworkers higher wages and ease pressures for
unionization in this vital sector of the economy.
Despite the benefits enjoyed by the mining sector, not
all South African companies have gained from the
floating rand. Record high interest rates have reduced
consumer borrowing, cutting sales in the automobile
and construction industries, according to press
reports. In addition, many South African companies
misjudged the magnitude of the decline in the rand in
a floating exchange system, and suffered substantial
losses, according to industry sources. Companies that
signed contracts to deliver goods based on production
costs under one exchange rate, for example, lost
money when the fall of the rand raised the local prices
of imported raw materials and intermediate goods.
25X1
To provide insurance against this risk, the Reserve
Bank has encouraged the development of futures
markets in South Africa for foreign currency by
making more dollars available to local foreign
currency traders? Such markets would enable
companies to fix their exchange rates for future
purchases of dollars or other foreign currencies.
Futures markets, which are well established in the
United States and other Western nations, have the
added benefit of moderating drastic swings in
exchange rates, according to academic studies. F_
' Previously, the Reserve Bank, as the principal seller of South
African gold on world markets, had kept the dollars earned from
gold sales and paid the mining companies their revenues in rand;
under the current arrangement, half of the gold revenues are paid
to the mines in dollars with the condition that the companies sell
these dollars within five days after their receipt. F__1
De Kock strongly defends the new exchange rate
policies, according to US Embassy reporting, and
argues that maintaining the value of the rand at an
artificially high level as gold prices fell would have
drained Pretoria's remaining foreign reserves.
Nevertheless, the Reserve Bank has intervened to
keep the rand from falling too quickly. De Kock
justifies this deviation from the new hands-off
approach by arguing that much of the downward
pressure on the rand in December 1984 and January
1985 was the result of the poorly developed futures
markets. In his view, companies saw the downward
path of the rand and panicked, selling rand for dollars
or other foreign currency to cover future imports
before their rand became even less valuable on world
markets. This panic selling, in de Kock's opinion,
added to downward pressures on the rand. The
currency has stabilized since in the 50 to 55 cents
range.
Political Considerations
The monetary reforms are a bold move politically for
Pretoria, in our view, and represent a willingness to
risk some short-term support in exchange for long-
term economic gain. In common with many elements
of President Botha's racial reform program, the
streamlining of monetary policy reflects an ideological
shift away from the use of government controls to
solve social and economic problems, and toward
greater reliance on market forces. Although monetary
reforms lack the overtly racial considerations involved
in modifying apartheid laws, much of the potential
gains from the higher economic growth that de Kock
envisions will result from monetary reforms would
accrue to South African blacks, while most of the
immediate costs of higher interest rates are being
absorbed by middle-class whites and white farmers,
two groups that have traditionally supported the
National Party. In our view, President Botha hopes
that by accepting the de Kock Commission
recommendations, the country's economy will have
sufficiently improved by the time of the next elections
in 1988 or 1989 to more than offset any political
damage. Whether or not this gamble pays off will
depend on consistency with which the new market-
oriented approach is applied in practice.
25X1
25X1
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Djibouti-Libya: Keeping
Qadhafi at Bay
expense.
In our view, growing domestic unrest in Djibouti-
unless kept in check by more vigorous leadership by
President Hassan Gouled-may provide Libya with
attractive opportunities to improve its position in the
Horn of Africa. US Embassy reporting indicates that
Libya has kept the Gouled regime off balance with an
array of carrot-and-stick tactics, and has succeeded in
casting doubt in Djibouti over the depth of French
commitment to this strategically located nation.
Should Gouled stumble in meeting the internal
challenges that lay ahead, we believe Colonel Qadhafi
may gain increased room for maneuvering at Western
attempt to keep Qadhafi at arm's length.
Mixed Signals
Tripoli's diplomacy of alternating promises and
threats has placed Djibouti-Libyan relations in a state
of flux. The US Embassy reports the Gouled regime
views Qadhafi with a mixture of fear, hope, and
suspicion. Gouled fears the potential for increased
Libyan meddling at a time of escalating domestic
instability, according to the Embassy. At the same
time, Libya's diplomatic gains with Sudan, Somalia,
and Morocco have enhanced Qadhafi's stature in the
eyes of some Djiboutian officials-Foreign Minister
Moumin among them-and raised hopes for Libyan
assistance to Djibouti's ailing economy. Although
dealing with Qadhafi now appears diplomatically
fashionable in Africa once again, we believe Gouled
will remain suspicious of Libyan intentions and
From our perspective, Qadhafi is intent on
establishing broader influence in Djibouti, with a view
to enlarging Libya's role in Horn affairs at French
expense. US Embassy reporting suggests that the
Libyan leader seeks to drive a wedge between Paris
and Djibouti by playing on Gouled's fear of isolation
in the Arab World. In addition, Qadhafi continues to
court the conservative, pro-Western Gouled to grant
relay facilities for Radio Tripoli, implying that
Libyan economic assistance will be forthcoming in
return. Although the Embassy reports no active
Libyan aid programs at present, Tripoli recently
provided Djibouti with a well-equipped maternity
clinic-as yet unopened-that has become an irritant
in relations. Embassy officials say Qadhafi is
withholding operating funds in an attempt to pressure
Gouled to support Libya in international forums.
Complementing Tripoli's diplomatic pressure tactics
are indications of a Libyan campaign to undermine
the Gouled government.
Embassy believes Gouled is not eager to affront
Qadhafi, and could not easily dismiss Libyan
overtures for improved ties.
Gouled's Growing Vulnerabilities
The US Embassy reports that Gouled faces a growing
list of domestic problems-all vulnerable to
manipulation by Qadhafi-which threaten the
regime's stability and may weaken its will to resist
future Libyan advances. Foremost among these
problems is a large budget deficit. Faced with severe
unemployment and an inability to expand
significantly its stagnant economy-which is based on
commerce and transit trade with Ethiopia-Djibouti
must rely heavily on foreign aid at a time when its
primary benefactors-France and Saudi Arabia-are
themselves experiencing severe financial difficulties
and cutting back assistance programs. Gouled's
budget problems are further aggravated by
Secret
ALA AR 85-017
26 July 1985
25X1
25X1
25X1
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Secret
between rival Issa and Afar tribesmen.
inefficiency, the strain of coping with refugees from
Ethiopia and Somalia, and continued tensions
to deteriorate visibly in recent months.
The economic collapse has sparked growing domestic
unrest that periodically erupts in small-scale strikes
and demonstrations against the government. The US
Embassy says a malaise among students, unemployed,
businessmen, younger civil servants, and junior army
officers has caused the government's public standing
25X1
serves as a vital link to French forces in Europe and is
a key location for the protection of oil routes through
the Suez Canal and Bab el Mandeb Strait. Although
concerned over potential Libyan meddling, we believe
the Mitterrand government will continue its policy of
gradually reducing direct budgetary support to
Djibouti-a policy that has reduced French aid by
half since 1980 to its present level of about $8.6
million per year. According to the US Embassy,
France is looking for ways to share the burden of
support for Djibouti with more Western and moderate
Arab states, citing budgetary austerity, its
commitment to Chad, and the negative impact of a
strong US dollar on the French franc.
and gaining needed economic assistance.
While seemingly committed to reducing its economic
aid to Djibouti, US Embassy reporting indicates that
Paris has sought to reassure Gouled that its 4,800-
man military contingent will be kept in place. Under
the Franco-Djiboutian treaty, Paris is obligated to
defend the country against external aggression. The
French military presence and spending by French
soldiers are important to the local economy. We
believe Gouled will forgo dramatic gestures toward
improving relations with Qadhafi as long as France
maintains its troops there. Should Gouled fail to
secure reliable aid sources to compensate for
reductions in French support, however, the pressure of
looming budget shortfalls and fear of the instability
they could engender may induce him to move closer to
Qadhafi in hopes of tempering Libyan adventurism
Prospects
In our view, Djibouti is entering an increasingly 25X1
unstable period in which Gouled's leadership abilities
will be severely tested. Gathering social tensions,
chronic economic distress, and passive allies threaten
to open opportunities for Libya. Recent diplomatic
successes have bolstered Qadhafi's credibility and lent
momentum to those in Gouled's regime who favor
warmer ties with Libya. We believe the potential
exists for an upgrading of ties, but much depends on
Qadhafi's diplomatic skill and how desperate Gouled
may become. We believe Qadhafi's hand has never
been stronger, and if he cannot entice Gouled with
diplomacy and promises of economic aid, the Libyan
leader will not hesitate to increase attempts to
destabilize Gouled's regime.
Gouled's future almost certainly depends on
supplementing-or restoring-French economic and
military commitment to Djibouti, in our judgment.
Although Gouled is eager to expand economic ties
with moderate Persian Gulf states and the West-
particularly the United States-we believe most
nations are waiting for France to take the lead. For its
part, France may feel its still vital economic and
military role will be enough to sustain French
influence in the post-Gouled period, no matter how
radical his successors. In the event of a coup against
Gouled, we believe France would act only to protect
its nationals, and take its chances with the successor
regime. Meanwhile, the Mitterrand government
probably will continue its gradual economic
withdrawal-trying to encourage a greater US aid
role-while upholding its military commitment to
Djibouti for the foreseeable future.
We believe Gouled's odds of holding on are slightly
better than even. A more vigorous leadership role--
Gouled has a reputation for muddling through-and a
reassertion of government authority would go far in
enhancing his prospects. The US Embassy reports
Gouled has recently begun to show some political
muscle in an attempt to crack down on corruption and
stanch the erosion of public confidence in his
government. In addition, Gouled's political survival
will hinge on how shrewdly he manages the balancing
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
act between rival interests in Djibouti-Issa and Afar,
French and Libyan, Ethiopian and Somali. Should
domestic unrest boil over, however, an anti-Western
regime could come to power, an event that probably
would clear the way for more direct Libyan
involvement.
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7 _
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Secret
Comoros: Ten Years of
Independence
The Federal Islamic Republic of the Comoros faces
an uncertain future as it celebrates 10 years of
independence this month. Ahmed Abdallah
Abderemane is serving his second and final
six-year term as President under the constitution he
promulgated in 1978. He faces a variety of
economic and political challenges resulting from the
Comoros's colonial legacy, geographic limitations,
postindependence power struggles, and his
autocratic style of rule.F____-] 25X1
Historical Setting
A variety of cultures influence social and political
development of the islands in the Comoran
archipelago-Grand Comore, Moheli, Anjouan, and
Mayotte. In the 15th century, Shirazi Arab traders
established sultanates in the islands, and introduced
Sunni Islam to what has now become a largely mixed
Afro-Arab population. Moheli and Mayotte, however,
eventually fell under the domination of the large
island state of Madagascar which plundered the
islands' population in slaving raids. The first
significant European presence in the islands was
established in the mid-19th century when
Madagascar ceded Mayotte to France.
descendant from the French.
Despite longstanding interisland rivalries among the
ruling Shirazi elite, the Comoran sultanates were
united by France into part of a larger colony with
Madagascar after that island had become a French
protectorate in the late 19th century. The center of
colonial administration for Comoros remained at
Mayotte, which offered the best natural port facilities,
until the French bowed to pressure from the ruling
elites on the other islands and shifted the capital in
1962 to Moroni on Grand Comore. Mayotte, however,
retained close cultural ties with France because,
unlike the other islands, its inhabitants are
predominately non-Muslim and ethnic Creoles,
Toward Independence. Comorans voted in a
referendum in 1958 for continued French rule with
internal self-government carried under a Council of
Ministers and a territorial assembly. Despite the
referendum, expatriate Comorans on the East African
mainland and several influential families in the
islands pushed for independence throughout the
1960s. Abdallah, a conservative politician and
member of an elite, landowning family from Anjouan,
assumed the presidency of the Council of Ministers in
1972 and began to press more vigorously for
independence. In 1974, a referendum calling for
independence was supported overwhelmingly by all
Comorans except a majority of the inhabitants of
Mayotte. France agreed to grant independence the
following year but, under pressure from politicians
from Mayotte, postponed independence pending a
second island-by-island plebiscite on the issue.
Abdallah unilaterally declared independence for all
the islands in July 1975; Mayotte, however, refused to
acknowledge Comoran sovereignty and continues to
be administered by France.
The Radical Years: 1975-78. One month after
independence, Abdallah's government was toppled by
mercenaries working for an amorphous and
opportunistic six-party opposition coalition that
appointed the radical Ali Soileh as head of state in
January 1976. Soileh embarked on a harsh rule
designed to restructure Comoran society by replacing
many Islamic customs with a "socialist" revolutionary
ethic. Soileh relied on youth militia brigades-the
Moissy-to deter internal opposition through a
campaign of terror and violence. Popular discontent
grew as Soileh broke with Comoran traditions and his
socialist policies accelerated economic decline. In
May 1978, Abdallah returned to power after
financing a coup led by the well-known mercenary
Bob Denard and many of the same mercenaries who
had deposed him two years before.
The Second Abdallah Regime
US Embassy reporting indicates that Abdallah has
attempted to keep Comoros on a moderate political
course since his return to power. Press reports suggest
Secret
ALA AR 85-017
26 July 1985
25X1
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Comoros
Grande
Comore
Boboni
Hoani Moheli
Fom tonton Djoiezi
Moihani Kangani
Anjouan
Bambao
Domoni
M'Ramani
Chingoni
Sada
Mayotte
;Adm~n~sfeeed bj Prance.
ute:med by Gemnroa}
Mamutzu
Dzaoudzi
Ile Panianzi
D5mbeni
Bandele
Proani,
Kani Kole
502,709 9.77 (542090)
Lanmtert Conformal Project-.
Standara oa rape's 6' and 00?
Scale 11,200.000
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
that, despite the taint of his mercenary-backed
regime, Comorans prefer Abdallah's comparatively
benign one-party rule to that of the repressive Soileh
largely because he quickly restored Comoran Islamic
traditions. Endemic rumors of plotting and coup
attempts, however, indicate Abdallah's hold on power
is not firm. In our view, the President must surmount
a variety of economic and political challenges if he is
to survive over the next few years.
25X1
Economy in Disarray. Comoros's geographic
limitations clearly have been a significant deterrent to
economic growth. The US Embassy reports that the
islands have no known mineral resources; the
surrounding coastal waters cannot sustain exploitable
fisheries because the continental shelf is too narrow;
the rocky coastlines contain no natural deep water
harbors; and water shortages occur on the most
populated island, Grand Comore, because the porous
volcanic soil can not sustain surface streams year-
round. In addition, according to Embassy reporting,
the population is growing at about 3 percent annually,
faster than food production can increase and
threatening to overwhelm existing social services.
25X1
In our view, government policies have done little to
diversify the economy and to expand food production.
The regime relies on a plantation-system economy,
established under French rule, which monopolizes a
majority of what little arable land is available to
produce vanilla, copra, spices, and perfume essence
for export. Cash crops accounted for 99 percent of the
government's foreign exchange earnings in 1984, but
the value of exports has declined in recent years
because of reduced world market demand. The US
Embassy reports that agriculture also suffers from
extensive soil overworking and the primitive farming
techniques practiced by village farmers, who take
advantage of ambiguous sharecropping regulations to
encroach on the cash-crop estates and plant
subsistence food crops, according to Embassy
In our view, the Abdallah regime is becoming
excessively dependent on foreign loans for both
balance-of-payments support and development
schemes. US Embassy statistics indicate that growing
foreign indebtedness has boosted public debt from 38
percent of GDP in 1980 to 116 percent of GDP in
1984. Increased amounts of foreign exchange reserves
are being spent on food imports. Embassy officials say
that the growing current account deficit-21 percent
of GDP by yearend 1984-is becoming a major
problem. This year the regime briefly attempted to
economize by eliminating the military's meat ration
and halting salary payments to teachers and civil
servants until France provided some emergency funds,
according to the Embassy.
Foreign Relations. US Embassy reporting indicates
that Abdallah consistently has pursued a staunch pro-
Western foreign policy. He has sought to expand on
traditional ties with France and moderate Arab
states, and to strengthen relations with the United
States. Embassy officials say that the President, for
example, repeatedly has pressed the United States
and France to accept his longstanding offer to
establish military facilities in Comoros. He also has
moved to improve cool relations with neighboring left-
leaning Mozambique and Madagascar, and he has
established better informal commercial relations with
Pretoria.
Abdallah has rebuffed most Soviet efforts to
strengthen relations because, according to US
Embassy officials, he believes that Islam and
Communism are incompatible. Moscow most likely
seeks access to local port and air facilities, although
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Selected Economic Indicators - 1975-84
REAL GOP
ANNUAL PERCENT CHANGE
16-1 18
75 76 77 76 78 80 81 82 83 84
PRICES, GDP OEFLRTOR
RNNURL PERCENT CHANGE
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Secret
such access probably is not vital to limited Soviet
operations in the region. Late last summer, however,
the President accepted a Soviet offer of 13
scholarships, a gesture we believe was designed to
convey to the West his displeasure with aid levels, and
to indicate that he has alternative sources of support.
25X1
Abdallah almost certainly views maintaining
reasonably good relations with France as essential to
the survival of his regime. France provides the
majority of Western economic development assistance
and almost all balance-of-payments support as well as
limited security aid. Bilateral relations, however, are
not entirely smooth, according to US Embassy
reporting. Abdallah most likely resents France's
repeated withholding of assistance funds because of
poor Comoran fiscal accountability. F__1 25X1
islands will depress Mayotte's economy.
The US Embassy reports that relations with France
also are strained by Abdallah's persistent accusations
that Paris is deliberately delaying measures to bring
French-administered Mayotte under Comoran rule.
France has a garrison of foreign legionnaires and a
small naval facility on Mayotte. A second referendum
to decide Mayotte's future is tentatively scheduled for
later this year. In our view, Abdallah seeks to
integrate Mayotte not only for nationalistic reasons,
but also because Mayotte is the most prosperous and
developed island in the archipelago. Embassy
reporting suggests Abdallah still faces strong
opposition to unification from the island's inhabitants,
who are fearful integration with the other, poorer
state.
Internal Dynamics. Abdallah has consistently sought
to suppress all political opposition since his return to
power. His political party, the Comoran Union for
Progress, was made the country's sole legal party in
1982. We believe that Abdallah amended the
Constitution two years later to undermine the
influence of political rivals. He abolished the post of
Prime Minister and altered the succession procedure
probably to ensure that the designated successor-
longtime rival Mohamed Taki-could not assume
power. Last January, the President consolidated his
authority further by shuffling the Cabinet and
reducing four rivals to coequal status as ministers of
We believe, on the basis of US Embassy reporting,
that, although Abdallah's political rivals lack
sufficient national stature to successfully challenge
his hold on power, the President's maneuverings have
not completely eliminated opportunities for his
opponents to destabilize the regime.-For example,
press reports suggest that Taki, now residing in
France, may be garnering influence with a small but
vocal group of exiled oppositionists and possibly also
with French elements opposed to Abdallah's recent
openings toward South Africa. We know little about
internal civilian opposition to Abdallah, other than
that it probably is fragmented and espouses a leftist
ideology.
In our view, the military poses the greatest threat to
Abdallah's rule. The President has attempted to
minimize military coup plotting by dispersing the
military and gendarmerie throughout the three
islands. However, US Embassy reporting suggests
that disgruntlement in the military is growing over
Abdallah's preferential treatment of his personal
protection unit, the white mercenary-led presidential
guard. A narrowly averted coup last March by
disgruntled Comoran members of the unit, however,
underscores
the President has
responded to the coup attempt by doubling the
number of white mercenaries in the guard to 50.
Short-Term Outlook
Abdallah will have to tread carefully so long as
military frustration continues over his apparent
favoritism toward the presidential guard and the
white mercenaries. In our view, there is a reasonable
chance that elements in the military may attempt to
move against the regime again, but we believe that
any coup plots probably would be thwarted by the
upgraded mercenary contingent. In our judgment,
however, the mercenaries themselves could become a
source of new difficulties for Abdallah. US Embassy
reporting suggests that the white leadership is
splitting into two discernible factions: an older
element oriented politically toward South Africa and
seemingly loyal to Bob Denard, and a younger, less
25X1
25X1
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7 _ _
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Secret
experienced group amenable to French interests and
loyal to the guard commander, a Belgian mercenary
known as "Commander Charles."
The economic picture will remain, in our view, bleak,
and Comoros's geographic limitations, shortsighted
economic policies, and history of poor fiscal
management suggest that the islands will be
dependent on foreign largesse for the foreseeable
future. From our perspective, Abdallah almost
certainly will avoid provoking a cutoff in French
financial assistance, so he probably will not go beyond
rhetoric designed mainly for domestic political
consumption in pressing France for the integration of
Mayotte. Abdallah most likely will seek increased aid
from the United States following the scheduled
opening of the US Embassy in Moroni this August.
We believe that cool relations with the Soviet Union
are unlikely to improve appreciably over the near
term. The Soviet Union appears unwilling to provide
Abdallah with the levels of economic assistance
Comoros requires, and Abdallah probably would
refuse Soviet enticements of military assistance. In
our view, however, relations with Moscow could
improve should Abdallah, who is in his mid-60s, die
while in office. We believe there is a chance
succession provisions could be ignored and that any
ensuing power struggle would hold uncertain
prospects for pro-West elements. Similarly, a
successful coup could bring to power elements
inclined to move closer to Moscow.
25X1
25X1
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7 -
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Africa
Briefs
French drug enforcement officials are working with authorities in Benin and Togo
to curb traffic of heroin, cocaine, and marijuana, primarily to France and the
United States. The investigation reportedly indicates that large quantities of
heroin and cocaine are arriving in Cotonou, Lome, and Accra from a network
operating through Lagos. the narcotics-heroin
from Pakistan and cocaine from Latin America-are flown into Lagos, smuggled
into Cotonou, and then concealed in the luggage of Beninese who are flying to
Paris. The narcotics are often transported by women, who are believed less likely
to arouse suspicion. Money is exchanged in Paris, after which the drugs are again
concealed and flown to the United States. The Embassy estimates that the total
volume of narcotics involved is substantial given the number of people believed to
be taking part.
Over the past year, several hundred kilograms per month of marijuana, which is
grown in substantial amounts in Benin's northern mountainous region, have
reached Paris from Cotonou, The marijuana is often
shipped as unaccompanied baggage, labeled fruits and vegetables. The quantities
involved and the method of shipping suggest the complicity of the local airlines, as
well as customs and immigration officials. The Beninese Ministry of Interior has
issued instructions to transfer all customs and immigration officials at Cotonou
Airport to other locations. Embassy officials, however, believe that the move will
bring only temporary improvement because of widespread corruption within these
services.
Beninese and Togolese police authorities are
cooperating. Both countries have accepted a French offer to train security officials
on drug control techniques. Beninese police arrested members of two of the four
drug-smuggling operations known to be operating through Cotonou, but members
of a third operation escaped to Ghana. A fourth ring of both French and Beninese
traffickers continues to operate So far, no attempt
has been made to obtain help from Nigeria because
the Nigerian security services are too corrupt to permit an effective investigation.
Public discontent, especially among student and labor groups, over economic
reforms imposed by President Kerekou has increased sharply, according to the US
Embassy. Kerekou's decision to halt guaranteed government employment for all
university graduates prompted student strikes in April and May.
21 Secret
ALA AR 85-017
26 July 1985
25X1
25X1
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7 __
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Secret
to the US Embassy, Foreign Minister Affo claims that he has concrete evidence
that the Libyan Peoples Bureau in Cotonou was involved with the students.C
25X1
Kerekou responded harshly by closing schools and ordering police and security
forces to shoot demonstrators on sight. He dismissed Minister of Higher
Education, Col. Michel Alladaye, who was a principle instigator of the October
1972 coup that brought Kerekou to power.
The schools reopened last month without incident, but we believe that additional
austerity measures could provoke more unrest. In our view, further turmoil may
encourage hardcore leftists in the military to seek Libyan or Soviet backing to
overthrow Kerekou. Kerekou has turned to the West in the past several years in
search of economic aid, and the Libyans and Soviets probably would be eager to
lend support to coup plotters in an effort to restore formerly close ties to Benin.
South Africa Controversial Anglican Synod
South Africa's predominantly nonwhite Anglican Church passed a series of
controversial resolutions at its triennial synod in July that may prompt a split in
the 1.5 million-member church, according to the US Embassy. The church
formally condemned several recent government measures to counter black unrest,
including the growing number of detentions and deaths and the unexplained
disappearances of black activists. In addition, the synod sent telegrams to senior
government officials requesting an inquiry into police and military activities in the
townships. The Anglican Church belongs to the multiracial, interdenominational
South African Council of Churches, which demanded last month that President
P. W. Botha immediately withdraw the army and riot police from black townships,
charging that security forces were actually responsible for much of the violence.
Whites, who make up about 20 percent of the Anglicans but provide more than 70
percent of church funds, probably will react to these decisions by the nonwhite
majority by reducing contributions and perhaps leaving the church.
25X1
25X1
25X1
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Malawi Military Expansion
conflict may spill over into Malawi.
Despite economic constraints, Malawi recently began a military buildup that
apparently is prompted by concern over the worsening security situation in
neighboring Mozambique. Malawian exports and imports transiting Mozambique
continue to be disrupted by the Mozambican rebels, and Lilongwe is unable to stop
the insurgents from using its territory for safehaven. An influx of Mozambican
refugees and worsening violence in border areas have increased prospects that the
periods.
Military expansion plans call for a doubling of troop strength, currently 6,800, and
increased recruitment has started. The Army is seeking to augment its stocks of
modern small arms and upgrade field communications and air defenses, according
to has already purchased four obsolete but
serviceable South African Eland armored cars with ammunition, and at least one
military patrol boat from France. Although the Army completed extensive combat
training on the Elands in July, we believe additional purchases of South African
arms, including more Elands, are likely only if the South Africans continue to
offer competitive financing. The one-year-old militia has been expanded to 1,200
men, and has established regional commanders and regular training and pay
25X1
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
 Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7
Secret
Secret
Declassified in Part - Sanitized Copy Approved for Release 2011/12/28: CIA-RDP87T00289R000100380001-7