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www.africa-confidential.com 11 October 2002 Vol 43 No 20 AFRICA CONFIDENTIAL CÔTE D’IVOIRE 3 ANGOLA Whose army? The rebels may be a rag-tag bunch Neutering UNITA of low-ranking soldiers, but they President Dos Santos’ ruling MPLA is glad of victory in the war have the support of local people in against UNITA but resists other kinds of change the territory they control, and they Eight months after the violent death of Jonas Malheiro Savimbi, the oil-financed élite of the ruling won valuable diplomatic points for cooperating with West African Movimento Popular de Libertação de Angola is neutering his União Nacional para a Independência mediators. In contrast, President Total de Angola (AC Vol 43 Nos 8 & 12). The UNITA-Renovada splinter group, formed by Eugenio Gbagbo’s refusal to sign a Manuvakola in 1998 to rival Savimbi’s UNITA, was badly weakened when Manuvakola stepped down ceasefire and his anti-foreigner on 30 July. His successor, Jorge Alicerces Valentim, has a big mouth, little charisma and no real support. rhetoric are winning him no friends. The MPLA has put most other UNITA leaders into a gilded cage. Mainstream UNITA still has strong popular support, mainly but not entirely among the highland IMF/WORLD BANK 4 Ovimbundu people – although its interim leader, General Paulo Lukamba ‘Gato’, does not command the same fear-filled affection as his late predecessor. A party congress, possibly in mid-2003, will elect The terror factor a new leader. There is talk of links with smaller parties, including the northern, Bakongo-dominated, World Bank President James Frente Nacional para a Libertação de Angola, whose veteran chief, Holden Roberto, is old, tired and Wolfensohn firmly told rich country undermined both by state propaganda and by his aspiring successor, Lucas Ngonda. Another possible delegates at the Bank and Fund ally is the Partido do Renovação Social (PRS), strong in the north-eastern diamond regions. annual meetings that they need to Political alliances will not matter much until the elections, officially in late 2004, probably in 2005 or help poor countries because later. The only declared candidate of note is Vicente Pinto de Andrade, an intellectual from an poverty breeds terrorism. Put like that, the aid message may get established MPLA family and perhaps the stalking horse for another reformist MPLA man, Lopo through. Fortunato Ferreira do Nascimento, who has not yet declared, and has numerous enemies and not much presidential ambition. AFRICA/COTTON 5 Don’t forget Cabinda Cottoning on to the A different kind of small party is the Frente para a Libertação do Enclave de Cabinda, which fights for independence for the enclave that produces over 60 per cent of the country’s 930,000 barrels of oil per WTO day. FLEC’s bickering factions, held loosely together by a popular cause, stress that the fighting is far African cotton producers are from over in Angola – unless Cabinda is another country. It has won some attention by accusing the opposing US plans for fat subsidies Forças Armadas Angolanas of launching brutal new offensives in Cabinda. The MPLA, while fostering to cotton farmers and may bring a FLEC’s divisions and complaining of interference by shadowy ‘foreign circles’, maintains it cannot formal case at the WTO. negotiate until Cabinda provides a single interlocutor, so the conflict will continue. Washington is threatening to cut aid and debt relief but African The MPLA and its opponents come together in a 44-member parliamentary commission that is producers are organising – with supposed to produce a new constitution, to be voted on by parliament – where UNITA, with 70 seats, Brazilian support. could in theory combine with other opposition parties to deny the MPLA the necessary two-thirds majority in the 220-member house. The MPLA and UNITA broadly agree on a ‘semi-presidential’ SOUTH AFRICA 6 system; the MPLA wants a government run by the president, UNITA prefers leadership by a prime minister. The last premier, Marcolino Moco of the MPLA, held the job until it was abolished (probably Scrambling for Africa unlawfully) in January 1999, shortly after the collapse of the 1994 Lusaka peace protocol. The MPLA insists provincial governors should be appointed, not elected. With UNITA tranquillised, South African businesses are officials have been able to visit the provinces and see at first hand the awful consequences of inadequate hoping to be first in line for contracts if President Mbeki’s NePAD pays governors. In Bie, Luis Paulino dos Santos was sacked in April; in Malange, Flávio Fernandes was off. Telecoms, energy and sacked in July. transport companies are looking The MPLA’s main aim is to keep tight control of politics and to keep UNITA down. It promotes Jorge to move into new markets where Valentim, the UNITA spoiler, in the news, subtly indicating that he has a chance of eventually leading their services are badly needed. the party, along with Gato, Isaías Henrique Ngola Samakuva (Paris-based representative) and Abel Epalanga Chivukuvuku, parliamentary affairs chief in Gato’s Politburo. In fact, Valentim is a non- POINTERS 8 starter. Other senior UNITA people include Jerónimo Wanga, new head of its parliamentary caucus, and Jaka Jamba, Deputy President of parliament. Morocco, Zimbabwe, Chivukuvuku is urbane, charismatic and well liked by Westerners but has a skimpy party following. France/Angola & Samakuva, widely respected and a man to watch, is unwilling to come to Luanda, reportedly afraid for his personal safety. Wanga is soft-spoken, thoughtful and appears timid. Jamba is more of an ideologue USA/Africa than a leader. Manuvakola is out of the picture. Senior members of UNITA’s external wing, nominated by Savimbi, include Adalberto da Costa 11 October 2002 Africa Confidential Vol 43 No 20 Clinging to the cash box For once, donor money may influence Angola’s oil-rich leaders. At present, signs that the United States, despite its growing interest in African oil and the country receives humanitarian funds, channeled through the United its oil presence in Cabinda, is urging the IMF to go easy on Angola. Nations and collected through a consolidated appeal. For 2002, the first Signs of transparency have emerged, such as a new Finance Ministry target was US$234 million, later revised upwards to $292 mn.; less than half website with well ordered information on government finances. There is no of that had been pledged by the end of September. The UN Coordinator, Eric matching frankness, though, about the size and nature of state expenditure. de Mul, says Angola itself must share ‘a greater part of the burden’ in the A ‘diagnostic study’ being developed to model oil revenues could have 2003 appeal, to be launched in mid-November. helped track real revenues but it is bogged down and the international With the fighting essentially over, Angola wants to be treated as a accountants KPMG, which are helping design it, haven’t been paid. ‘normal’ developing country, through a donor conference. (The last one, in Western organisations (including London-based Global Witness, which 1995, pledged around $1 billion). Emergency aid is administered by UN launched the ‘blood diamonds’ campaign) have launched a campaign to agencies and non-governmental organisations, while funds pledged at donor make mining and oil companies publish what they pay to governments such conferences flow directly to the recipient government – in other words, as Angola’s. The idea is to make frankness about such payments a Angola’s rulers can get their hands on cash received as ‘normal’ development requirement for listing on rich-world stock exchanges. The MPLA’s assistance. Signs of abnormality, such as the involvement in domestic Information Secretary, Norberto dos Santos ‘Kwata Kanawa’, recently politics of the UN Mission in Angola (Luanda would prefer just a bland UN denounced a ‘campaign of defamation against Angola by a north American Development Programme without political complications), the Cabinda multi-millionaire of Hungarian descent’. His target was the immensely insurgency and noisy external allegations of corruption, are deeply unwelcome rich good-governance campaigner George Soros, who backs Global Witness to the ruling Movimento Popular de Libertação de Angola. and whose Open Society Foundation’s head in Angola is Rafael Marques, A donor conference could not be arranged before 2003 at the earliest, after a vociferous and much harassed critic of the MPLA. Angola has been through a staff-monitored programme by the International Angolan diplomats are working to scupper the campaign. Their efforts Monetary Fund to show it can manage donor funds properly. Misplaced are being helped, whether intentionally or not, by the fact that the oil giants optimism, then bitter disappointment, has long characterised the Angola- ExxonMobil and ChevronTexaco are lobbying for a voluntary, instead of a IMF relationship. Luanda hopes the Fund will ease the strict conditions its mandatory, approach to publishing what resource-extraction companies pay programmes involve. There is absolutely no chance of that and there are no to foreign governments. That could allow the old mischief to continue. Junior (Rome), Colonel Domingos Jardo Muekalia (Washington) were formally extinguished on 2 August. The favour may be intended Carlos Morgado and Isaac Wambembe (Lisbon), Ernesto Mulato to turn UNITA soldiers against their commanders – the troops are (Lomé), Azevedo Kanganje (Brussels), João Vahekeny (Geneva). languishing obediently and surprisingly peacefully in horrible camps. Some have visited Luanda since Savimbi’s death, others don’t want to UNITA’s situation got worse when, on 24 September, the United or can’t afford to. (The MPLA claims they should dip into the huge States extended sanctions against it for another year. US Ambassador diamond stockpile amassed by Savimbi but the pile is still buried.) Chris Dell, who is concerned about the plight of ordinary Angolans, Under Gato, UNITA has also reached out to veteran members expelled is privately embarrassed and publicly explains the move as just an by Savimbi such as Fatima Roque, Norberto de Castro and Honório administrative roll-over. Even United Nations officials sometimes Van Dunem, none of them central figures. seem to play the government’s game. Ibrahim Gambari, the Nigerian who heads the ineffectual UN Mission in Angola (UNMA) as UN A passion for secrecy Secretary General Kofi Annan’s Special Representative, insisted on With little public debate, new laws, devised by President José Eduardo meeting Valentim who, despite his noisy complaints, was excluded dos Santos’ Special Advisor on Constitutional Affairs, Carlos Feijó, from the Joint Commission (JC) to oversee the 1994 Lusaka accords, have been passed on state secrecy, state security and access to official which were resuscitated following Jonas Savimbi’s death. documents. This passion for secrecy is inspired by judicial investigations The JC is officially discussing UNITA’s list of would-be ministers in Europe into the multibillion-dollar web of debt and oil, involving (mining, commerce, health and tourism) in the Governo de Unidade France’s Elf Aquitaine (now part of Total) and Société Générale, e Reconciliação Nacional (GURN, Government of National Union businessmen Pierre Falcone and Arkady Gaidamak, and Geneva- and Reconciliation); the party is also promised six mostly based trader Glencore (see Pointer). The new laws do at least make it underwhelming ambassadorships (Cape Verde, Canada, India, clear that official secrets must be specifically declared as such but they Mexico, Poland and the UN Educational, Scientific and Cultural could also be used for cracking down on journalists and dissidents, and Organisation), plus three governorships (Uige, Lunda Sul and Cuando on UNITA officials as they near the centres of power. Cubango provinces) out of 18. The MPLA may want UNITA to The government has given Gato a nice car and mobile telephone, and submit its ministerial nominations before the expected government pays for his residence at the ritzy Hotel Trópico – but took away his car reshuffle, in which Finance Minister Julio Bessa may take the rap for for a few days in September, bugged his hotel room and made it hard wider failures, including annual inflation of more than 100 per cent. for him to find alternative meeting places. Similar constraints have Marcial Dachala heads UNITA’s JC delegation. The government been imposed on Jamba, forced out of his comfortable residence team is led by Interior Minister Fernando da Piedade Días dos downtown to live among junior Sonangol employees in the suburbs. Santos (‘Nando’), Dos Santos’ most powerful rival, balanced by the To get to his office in parliament, you have to walk through the kitchen. President’s Machiavellian point-man, Helder Vieira Dias ‘Kopelipa’. By contrast, the MPLA has lavished attention on Savimbi’s army The Commission, overseen by the (partly) protective eyes of the UN chief, Geraldo Abreu ‘Kamorteiro’, who was made a three-star and the ‘Troika’ (Portugal, Russia, USA) of observers, offers UNITA general (along with his comrades Apolo Felino Yakuvela, Samuel space in which to build its post-war political existence before resuming Capinhala ‘Samy’ and Domingos Kananay) when, with 5,000 UNITA the fight against the oil-fired MPLA. In late August Gato, soldiers, they joined the official army, the FAA, after UNITA’s forces controversially, agreed to wind up the JC after 45 days, on 15 October. 2 11 October 2002 Africa Confidential Vol 43 No 20

Yet the first meeting did not take place until 26 September and the were planning to push south. In the ceasefire negotiations, they asked deadline may be extended for a few weeks, after which an undefined for an amnesty, reintegration into the country’s security forces and the UNITA-MPLA forum is envisaged. resignation of Defence Minister Moïse Lida Kouassi and the army Diamonds are still an outstanding issue. In 1997-1998, before the Chief of Staff, General Mathias Doué. In remarks to journalists, they Lusaka accords collapsed, a deal was taking shape, with the help of say they want to march on Abidjan and organise fresh elections in which American diamond dealer Maurice Tempelsman (whose LKI all political parties can take part. Ouattara, a former Prime Minister Diamonds pulled out of Angola after Lev Leviev won the diamond accused by successive governments of not being a ‘proper Ivorian’, has marketing monopoly). The plan was to set up a UNITA company never been allowed to contest a presidential election. called the Sociedade Geral das Minas, to take over some stakes from The government says it is the subject of ‘foreign aggression’ launched the government’s Endiama. It was agreed that concessions in Andulo from Burkina Faso but the rebellion’s backers are more likely to be the and Cuando Cubango would be handed over and others were being Dioula barons who have discreetly controlled the north for generations. discussed. A weakened UNITA can now hope only for some crumbs. They have observed with alarm the increasing xenophobia of successive The morsels will probably be doled out not to the party but to senior governments since the 1993 death of founding president Félix UNITA officials, creating yet more divisions. Houphouët-Boigny and have every reason to support regime change. Winding up the JC, and so ending the implementation phase of The formation of Ouattara’s Rassemblement des Républicains (RDR) Lusaka, would probably mean closing the camps around the country split traditional loyalties in the north. In Korhogo, veteran businessman where 90,000 former UNITA fighters, plus a quarter of a million of and politician Kassoum Coulibaly remains loyal to the Parti their family members, now live. The capable UN Coordinator in Démocratique de la Côte d’Ivoire (PDCI), the party founded by Angola, Eric de Mul, is unhappy that UN Special Representative Houphouët, while younger family members have joined the RDR – Gambari has tried to bring his government-friendly politics into the Coulibaly’s great-nephew, Amadou Gon Coulibaly, is RDR Deputy overstretched humanitarian operation. He says the UN World Food Secretary General. Alassane Ouattara’s elder brother Gaoussou Programme’s expansion into areas from which it was previously Dramane Ouattara is the patriarch in Kong, a solidly RDR town which excluded by fighting has increased its caseload in a few weeks from was once the capital of an empire founded by Emperor Sekou Ouattara 1.5 million Angolans needing food aid to 1.8 mn. people. in 1742.

‘If you’re not with us, you’re against us’ Gbagbo is now plainly employing the language of ethnic cleansing. ‘In CÔTE D’IVOIRE this country, once and for all, we need to know who is who and who wants what. We need to put on one side those who are for democracy and the Republic, and on the other those who are against democracy and Whose army? the Republic,’ he said in an address to the nation on 20 September. Alassane Ouattara, still holed up in the French Ambassador’s residence The rebels are winning more territory and the along with the Defence Minister’s family, is more of a pawn than a government is losing more friends player in this game. Three weeks after the start of Côte d’Ivoire’s armed uprising, its Gbagbo’s reluctance to sign a ceasefire with the rebels who control leaders have still not identified themselves. The rebel soldiers are nearly half the country was understandable but his arrogant and aggressive overwhelmingly junior but someone clearly organised over a dozen behaviour towards Ecowas mediators was not. Falling out with regional coordinated and largely successful attacks in Abidjan, Bouaké and heads of state who are close to French President Jacques Chirac, such Korhogo in the early hours of 19 September (AC Vol 43 No 19). The as Burkina’s President Blaise Compaoré and Togo’s President rebels have weapons and are apparently being paid, which has the Gnassingbé Eyadéma, may have been a particularly bad move. France happy effect of making them less inclined to loot than most of their is unimpressed with Gbagbo but its troops are obliged to secure regional counterparts. Abidjan, because the city is home to some 18,000 French nationals, as The rebels have at last given themselves a name, the Mouvement well as thousands more expatriates. An evacuation like that organised Patriotique de la Côte d’Ivoire. Some, known as the Zinzin (crazy from Congo-Brazzaville in 1997 would simply not be feasible. ones) and Bahéfouê (sorcerers), are soldiers recruited into the army by The government is outraged at France’s refusal to intervene in line former military leader General Robert Gueï, who had been resisting with its defence pact, arguing that it faces external aggression. Paris President Laurent Gbagbo’s efforts to demobilise them. Others are says it cannot intervene in an internal conflict, though its troops have deserters who fled to Burkina Faso after falling out with Gueï and established a tactical command and taken up positions on the main road support the main opposition leader, Alassane Dramane Ouattara. A south from Bouaké, preventing the rebels from marching on few of them are known to the authorities. The commander of the rebels Yamoussoukro and Abidjan. in Bouaké, Warrant Officer Tuo Fozié, was sentenced to 20 years in The government complains France hindered its initial efforts to crush gaol in absentia in April 2001 for an attack on Gueï’s home in the rebels and is now threatening to review the defence pact under which September 2000. some 600 French troops are stationed on Ivorian soil. Lida Kouassi, At least 400 people have been killed, including Gueï and Interior who escaped an attack on his home on 19 September, has emerged as the Minister Emile Boga Doudou, who were shot dead on the first day of regime’s strongman and is highly unpopular with the French embassy, fighting. Mediators from the Economic Community of West African even though the Ambassador is sheltering his wife and family. States (Ecowas) got the rebels to agree to a ceasefire, which should The government has appealed to citizens to show their patriotism by have been signed on 6 October, but the government refused any deal wearing the national colours of orange, white and green, and donations with the fighters who now control all the north and part of the centre. of money and food are being collected for the troops. Kouassi said on Loyalist troops attacked Bouaké on 6-7 October but failed to win 7 October that he had ordered pro-Gbagbo youth movements led by control of the city. The rebels said they had seized more weapons and firebrand student leader Charles Blé Goudé to postpone a march of

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‘young patriots’ on Bouaké. He claimed 10,000 young people were nations, ‘...it is a question of self-interest.’ He urged rich countries to prepared to sacrifice themselves in the fight for the city, though this open their markets, revive diminishing aid budgets and cancel debt. claim could not be independently verified. The Millennium Development goals, including universal primary The Abidjan authorities are organising ‘clean-up’ operations to education by 2015, a major reduction in infant mortality and the torch the shanty-towns where many northerners and immigrants live. reversal of the HIV/AIDS pandemic, were endorsed at Monterrey, Gbagbo said many of the insurgents were hiding in these districts and Mexico, in March. Rich countries promised US$12 billion a year to needed to be ‘cleaned out’. The London representative of Gbagbo’s boost development aid, half of it for Africa, whose economies should Front Populaire Ivoirien, Abdon Georges Bayeto, told Africa grow by an average of 7 per cent a year. The Bank’s figures show that, Confidential he was lobbying the European Union for aid to re-house in 2001, Africa’s economic growth averaged 3.1 per cent, after a the economically active people thus made homeless, while those decade of gross domestic product growth averaging (by most counts) without jobs would be expelled. about 3 per per cent. Welcoming the new United States Ambassador to Monrovia, John The Bank’s and the Fund’s projections are often over-optimistic; Blaney on 3 October, Liberian President Charles Taylor – never one next year, the IMF expects growth of 4.2 per cent, helped by higher to miss an opportunity for some good publicity – called for curbs on prices for non-oil commodities such as coffee, cotton and metals – but West African mercenaries. There have been reports of Liberians and only if rich-country economies start growing again. The Fund thinks Sierra Leoneans fighting with the Ivorian rebels. Africa’s two biggest economies will grow fast but not fast enough to Ghana said it was drawing up plans to evacuate its nationals, who reduce poverty and create jobs; South Africa at 3 per cent, Nigeria at number between 500,000 and a million, in the space of two days if 3.7 per cent (unless a Middle East war forces oil earnings up). The necessary. Both Guinea and Burkina Faso have closed their borders, projections indicate little change in growth for Africa’s other big though Guinea is remaining studiedly neutral. Its President, Lansana economies in 2003: Algeria, 2.9 per cent; Morocco, 4.1 per cent; Conté, was criticised at home for making no mention of the conflict Egypt, 3.7 per cent. in his national day speech on 2 October, although somewhere between Short-term optimists were rare. Aid to Africa fell from $28.6 bn. in 250,000 and a million Guineans live in Côte d’Ivoire. He is 1990 to $16.4 bn. by the end of the decade, according to the Organisation understandably unwilling to cause any upset. Conté survived the for Economic Cooperation and Development. The Bank’s and Fund’s destruction of his presidential palace during an army rebellion in 1996 market-oriented policies had not produced one self-sustaining economic and Gueï’s 1999 coup made him decidedly nervous. Burkinabè recovery in Africa. Governments and non-governmental organisations President Compaoré, having seized the moral high ground by blamed the Bank and Fund for emphasising economic growth while maintaining a discreet silence in the face of the Ivorian accusations, public health and education services collapsed. By 1998, the Bretton issued a statement on 7 October condemning the ‘barbarism’ of the Woods institutions at last agreed to write off some big debts for the Ivorian security forces and civilian vigilante groups. poorest and most heavily indebted countries but found it hard to raise So far, western Côte d’Ivoire, the main cocoa region and home to the necessary money. The Bank’s soft-loan International Development Gueï, Gbagbo and Boga Doudou, is calm despite fears of ethnic Association struggled to raise funds for its replenishment. reprisals. The rebels have reached Vavoua, some 60 kilometres north In Washington, the George W. Bush government started with deep of the western cocoa town of Daloa. While the cocoa price has soared scepticism about foreign aid but now calls it an important foreign to 16-year highs, the International Cocoa Organisation has suspended policy tool, using aid in the ‘war against terror’ as it did in the Cold plans to move its headquarters to Abidjan from London (AC Vol 43 No War. The US change was signalled at the Monterrey summit, with a 10) and many European cocoa traders say they are now buying only heavily conditional pledge of $5 bn. extra for the poorest countries. In cocoa that has been loaded onto ships, not risking paying for cocoa still June, the Group of Eight (G-8) summit in Kananaskis, Canada, in warehouses. Henri Konan Bédié, the former president toppled by elicited pledges of a further $1 bn. for the Bank’s and Fund’s Heavily Gueï and head of the once monolithic PDCI, is surprisingly quiet in his Indebted Poor Country (HIPC) debt relief scheme; and the European opulent lagoon-side home. He may be biding his time. Union and Ottawa jointly promised to increase aid budgets to $12 bn. a year, half of it for Africa. In July, industrial countries agreed to boost the IDA soft-loan fund by 18 per cent to $23 bn. over three years, again IMF/WORLD BANK with half for Africa. The decline in Western aid has been halted but the past decade’s 50 per cent cuts are unlikely to be restored.

The terror factor Empty pledges and failed policies Aid money promised may not be paid out. For example, Italy never The fear of more failed states may scare the actually delivered several hundred million dollars of soft-loan financing West into increasing aid for Africa pledged to the African Development Bank throughout the 1990s. The Rich countries have made grand promises at no fewer than three G-8 states pledged another $1 bn. for HIPC but World Bank officials summit meetings this year – in Monterrey, Kananaskis and (and Britain’s Chancellor of the Exchequer, Gordon Brown), were Johannesburg. However, their African counterparts did not expect exhorting countries to pay up at the annual meeting in Washington, anything dramatic from the World Bank and International Monetary because the programme could not finance the big debt write-offs just Fund annual meetings in Washington on 28-29 September. The global offered to Congo-Kinshasa (AC Vol 43 No 13). economic downturn and war-drums on Iraq preoccupied the rich- The Bank and the Fund at last, reluctantly, admit that almost two country delegates. All the same, United States attempts to win decades of structural adjustment policies haven’t worked in Africa. support for the ‘war on terrorism’ have concentrated minds in Poverty has worsened, most economies are growing far too slowly, Washington, where the new orthodoxy is that poverty breeds failed rural economies are under huge pressure and wholesale trade states and the terrorist networks that operate in them. Bank President liberalisation has damaged many local industries. They still claim, James Wolfensohn told the meeting that aid was not charity from rich though, that their policies have stabilised many hyper-inflationary

4 11 October 2002 Africa Confidential Vol 43 No 20 economies, even if they haven’t produced growth or cut poverty. policies, evaluation procedures and environmental and social standards. Over the past three years, structural adjustment has been tactfully African officials often spend more time relating to donors than readjusted. Liberalisation, deregulation and privatisation are still running projects. advocated as vital for sustaining growth and cutting poverty. It is now Wolfensohn has found common cause with South African President acknowledged, though, that structural adjustment and macro-economic Thabo Mbeki, with whom he spent a weekend just before the annual stabilisation can harm the poorest people. The revised aim is to meetings. Mbeki wanted to get Wolfensohn fully behind the New prioritise spending on primary education and healthcare. Adjustment Partnership for Africa’s Development; Wolfensohn wanted to step up programmes carefully include three-way consultations between Bank Bank operations in South Africa, the continent’s biggest economy. and Fund officials, civil society groups and recipient governments Mbeki praised Wolfensohn’s style: ‘He said the period of viceroys which, in place of the old force-fed economic reforms, are now called from the World Bank was over and that we cannot continue this upon to compile Poverty Reduction Strategy Papers (PRSP). Country situation in which we come and tell you what’s wrong and what’s right officials are in theory free to establish national priorities and they about your country’. The real test of Bank-African cooperation lies accept some scrutiny by local non-governmental organisations. In with the millennium development goals agreed at the Sustainable fact, most programmes are designed to please the Bank and Fund. The Development Summit in South Africa in August: halving poverty and United Nations Conference on Trade and Development (UNCTAD) making the economy grow at 7 per cent. If that can succeed, it will studied 27 PRSPs in Africa and found none that showed any really be a miracle. ‘fundamental departure from the kind of policy advice espoused under... the Washington consensus’. AFRICA/COTTON Challenging the Bank and Fund The UNCTAD study argues that Africa’s big problem is not inflation and that monetary and fiscal policies should be designed to raise Cottoning on to the WTO productive investment. It questions the Bank and Fund’s aim to Africans may ally with Brazilians against the provide free primary education and basic healthcare for all, with user USA to seek a fair deal for cotton exports fees for higher levels of service; UNCTAD wants school and medical fees to differ according to income. It also sharply criticises the idea Encouraged by Brazil, African cotton producers are opposing the that better and less corrupt governance can be promoted by reducing subsidy proposals in United States President George W. Bush’s government resources and responsibilities. Farm Bill. Several West and Central African countries, reeling from Similar arguments for building and strengthening African states another year of depressed cotton prices, may join Brazil’s formal case have emerged from Britain’s Department for International Development against the US subsidies, brought before the World Trade Organisation whose Minister, Clare Short, lobbies keenly alongside her colleagues: (WTO) on 27 September and designed to enlist support from other Norway’s Hilde Johnson, Germany’s Heidemarie Wieczorek- countries. The WTO has made its procedures cheaper and less Zeul, the Netherlands’ Eveline Herfkens and (token male) Sweden’s complex; African countries can join Brazil’s case and take advantage Jan Karlsson. Their ‘Utstein Group’ has met both the Bank and Fund, of Brazilian legal expertise or they can use the WTO’s new legal and US Treasury Secretary Paul O’Neill, and may have inspired a new advice centre, set up to provide free services to countries unable to pay American idea for a World Bank fund of $135 mn., to make low- for a long fight in Geneva. interest loans of between $1,000 and $50,000 for small businesses in Cotton illustrates starkly the unequal terms of world trade. Africa, Africa. The Director of the US Agency for International Development, the world’s third largest producer, turns out high quality cotton at the Andrew Natsios, thinks that Johnson wields influence out of all keenest prices. Yet it struggles to compete with heavily subsidised US proportion to Norway’s economic power. Other smaller rich economies and European Union cotton. Producers including France’s Dagris – with a special interest in Africa include Canada, Italy, Portugal and heir to the colonial Compagnie Française de Développement des Spain. Their share of foreign direct investment in Africa has risen to Textiles (CFDT) – warn that the industry, on which ten million 25 per cent, from 10 per cent in the days when the USA, Britain and Africans depend for a living, is near collapse. France dominated African investment. The producers say that subsidies to 25,000 US cotton farmers Bank President Wolfensohn and IMF Managing Director Horst prevent the market from correcting overproduction, favour the least Köhler are squeezed between Western treasuries demanding better efficient producers over the most competitive and have driven down returns for their aid dollars and radicals who focus on policy failings. the price by 25 per cent. Brazil believes its case goes to the heart of Köhler has tried to rebrand the IMF as a ‘listening fund’ and has visited inequalities in world agricultural trade, where production subsidies Africa three times in the past 18 months. The Fund’s credibility has undermine trade for developing countries. The cost of producing been boosted by the recruitment of an impressive new Africa Director, cotton in the USA is about twice the world market price of around 42 Abdoulaye Bio-Tchané (a former Finance Minister of Benin). US cents per pound; production cost in West Africa is about 38 cents. Wolfensohn pleases African ministers by denouncing Western Last year’s US crop, worth US$3 billion, attracted subsidies of $4 bn. protectionism and donor government bureaucracy. A new joint study US growers have increased their share of exports in the past 15 years by the Bank and Fund on Western protectionism (see Feature) called and now supply nearly a third of the world market. Brazil claims that the rich countries’ subsidies and tariffs on agricultural and manufactured the US export credit guarantee scheme is in effect an export subsidy, products a ‘tax on development’. Wolfensohn, urging donor prohibited by treaty, and that total subsidies to US cotton growers are governments to coordinate their aid programmes, pointed out that the twice the $1.9 bn. ceiling permitted under WTO rules. That is more Tanzanian government is required to complete 2,400 quarterly reports than the entire US aid budget for Africa. The International Monetary and receive 1,000 visits a year from various donors, each of them Fund and World Bank strongly and regularly criticise US and European wanting to put a flag on their own projects. There are about 63,000 farm subsidies in general and US cotton subsidies in particular. projects in the developing world, subject to differing procurement The slump in world prices has derailed budgetary forecasts for

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de l’Agriculture de l’Afrique de l’Ouest et du Centre, is in Washington Nigeria’s rag trade looking for ammunition. Progress may be delayed by tension between Burkina Faso and Côte d’Ivoire during the present Ivorian conflict On 2 October Nigeria banned imports of all textiles in a bid to revive its (see Feature). Quick decisions are necessary if African producers are own ailing industry. It now depends on imports from Asia, some of them to join Brazil’s case against the USA; the WTO must appoint a panel produced with Nigerian cotton sold via French traders to India and within the next two months. China. The ban seems aimed at China, which has been dumping African prints in Nigeria at below the cost of raw cotton. In the mid-1980s, Nigeria’s textile industry included 175 factories but SOUTH AFRICA by this June, it had under 40, few of them profitable. In its heyday it employed 250,000 people but this has now fallen to fewer than 50,000. Industry officials blame the decline mainly on rising imports and Scrambling for Africa dumping by China and other Asian producers. The government imposed the ban under pressure from trades unions and once prosperous factories Business hopes that President Mbeki’s pan- in the north. African vision can produce some profits too Textile costs have been increased by stiff duties on imported dyes, As Pretoria flexes its diplomatic muscles in Africa, championing the meant to protect local producers; traders say local dyes are of poor New Partnership for Africa’s Development and sending peacekeeping quality. The ban may be defeated by smuggling along established routes troops to Burundi and Congo-Kinshasa, its companies are following through Mali and Burkina Faso, and via corrupt customs officers in the flag. South African investors are looking keenly northward and the Benin and Nigeria. Yet if Nigeria could unravel the intricacies of new trade push is strongly in South Africa’s favour. Research from international agreements on textiles and trade, it might have a strong case Absa Corporate and Merchant Bank shows that in 2000, South Africa against the alleged dumpers at the World Trade Organisation. exported goods worth US$22.6 billion to elsewhere in Africa, from several Sahelian countries where IMF programmes are supposed to be which its imports were worth only $2.6 bn. In Kenya and Uganda, reducing poverty. Advocates of a making a tough stand include South Africa is replacing Britain as the biggest supplier of manufactured Senegal, Benin and Burkina Faso, whose President Blaise Compaoré goods and capital equipment. has been the most outspoken. Commercial diplomacy was on show in July in Durban, at the launch British charity Oxfam estimates that in 2001-02, US cotton subsidies of the African Union, when the Ministry of Trade and Industry cost Burkina 1 per cent of gross domestic product and 12 per cent of organised a parallel AU Business Summit; the Ministry’s co-sponsors exports, Mali 1.7 per cent of GDP and 8 per cent of exports, Benin 1.4 were Coca-Cola and MTN, South Africa’s second largest mobile per cent of GDP and 9 per cent of exports. Oxfam’s study suggests that telephone company. Over 130 companies in South Africa have signed trade losses associated with US farm subsidies outweigh the benefits an agreement to build a business network, in the name of pan- of US aid for West Africa’s eight main cotton exporters. Mali, for Africanism – and stronger profits. instance, received $37.7 mn. from the USA during 2001 but lost $43 In the past, South Africa did most of its business with Europe. Even mn. through cotton subsidies. In Benin, the $33 mn. losses sustained now, only ten African countries are among its top 50 trade partners – as a result of cotton subsidies were twice the value of US aid. Zimbabwe (16th), Mozambique (18th), Zambia (20th), Mauritius (33rd), Nigeria (36th), Malawi (37th), Kenya (38th), Tanzania (39th), Cancel the debt Angola (40th) and Congo-K (46th). Several of these belong to the Debt relief under the Heavily Indebted Poor Countries (HIPC) initiative Southern African Development Community, already linked by labour is proving inadequate in Benin, Burkina and Chad, where export migration, trade, electricity grids and shared water resources. Their losses caused by US cotton subsidies are wiping out provisions for economies have become more closely entwined as SA capital moves debt relief, Oxfam says. In CFA Franc Zone countries, where the across the borders. currency is pegged to the euro, the problem gets worse as the euro Mining, engineering, metal, transport, retail, food and beverages strengthens against the dollar. French cotton traders wonder whether and textiles drove the expansion of SA companies in southern Africa. Africa can also take on the European Union, which subsidises cotton Investment in agriculture, banking, petrochemicals, energy, hotels and growers in Spain and Greece. The EU, whose Common Agricultural telecommunications has followed. Companies such as Anglo- Policy blocks most African farm exports, is Africa’s biggest donor. American, Engen, Standard Bank, South African Breweries, Illovo The USA may fight back by threatening to cut aid and debt relief. Sugar, Sun International, Shoprite Checkers, Billiton (Gencor), Eskom Its African Growth and Opportunity Act gives preferential access to and Steers are familiar names across the region. Engen Oil has 165 some specific African textile products and includes a clause deterring retail sites in Southern Africa, 59 of them in Namibia, 28 in Botswana. action against the USA at the WTO. Mali is especially worried about In Cameroon, Congo-K, Nigeria, Rwanda and Uganda, SA concerns this; some claim that the USA is trying to stop Mali joining the invest in telecoms, petrochemicals, energy, banking, security, and Brazilian case. United action is essential. Cotton producers met last hotels and tourism. Eskom, Spoornet, Sasol and South African month in Benin to consolidate the African Cotton Growers Association, Airways (SAA), the big parastatals founded on support from apartheid formed this year, led by Ibrahim Malloum of Chad and encouraged governments, lead the way. Eskom, the world’s fourth biggest power by Dov Zera, former Director at Dagris. Some want African officials operator, wants a pan-African grid to supply countries such as Kenya to make cotton a test case both for the African Union’s resolve and for and Nigeria. In Nigeria, on the recommendation of President Olusegun commitment by the EU and USA to the latest blueprint for recovery, Obasanjo’s privatisation advisor, Eskom has a contract with the the New Partnership for Africa’s Development. federal government worth $164.4 million to help restructure the In June, agriculture ministers from West and Central Africa voted National Electric Power Authority (NEPA) ahead of privatisation. to sue the USA, EU and China at the WTO. Baba Ndioum, the NEPA, known to Nigerians as ‘Never Expect Power Always’, has Senegalese Secretary General of the regional Conférence des Ministres hovered on the brink of collapse for a decade.

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SAA now has the biggest range of routes in Africa. From its the American-owned Celtel 60,000 and Starcell, an analog network, Johannesburg hub, with a fleet of 60 aircraft, it flies to 20 foreign 20,000.) Vodacom intends to extend the network beyond Kinshasa African destinations and a dozen overseas. Two of its competitors and Lubumbashi into the mining areas. have shut down – Air Afrique, owned by 11 West African governments, Vodacom International Managing Director Andrew Mthembu was declared bankrupt in February and Belgium’s Sabena collapsed chairs the new Congolese company, with Alioume Dieng, who is in 2001. SAA’s only direct competitors, Air France, British Airways Congolese, as Chief Executive. Mthembu is a keen supporter of and Virgin Atlantic Airways, operate between African capitals and Thabo Mbeki’s Africanist visions; Vodacom markets its investments Paris or London. SAA has just signed a deal with Airbus to introduce as fulfilling the ‘African Renaissance’, forms alliances with local a new fleet over ten years. In July, it reported that profits for 2001 had operators, smooches the local political elite (President Joseph Kabila nearly quintupled, to $210 mn., from $40.8 mn. a year earlier. It plans was at the ceremonial opening of operations in Congo) and exploits to increase flights to Angola (already three times a week) and to carry local culture for marketing purposes. passengers between other countries, eg. Nigeria and Angola. Flights Elsewhere, SA businesses plan to invest in water management, to other African destinations represent ten per cent of SAA’s revenue security services, hotel and resort development, and book publishing. but are highly profitable. Domestic fares are priced in the depreciated Umgeni Water Enterprises, prominent in South Africa’s kwaZulu- rand; intercontinental fares must match those of bigger airlines but Natal province, has a deal to help exploit and manage water resources fares to the rest of Africa are priced in dollars. in Nigeria’s Rivers State. And sometimes one deal leads to another. The oil and gas exploration company Sasol – set up by the apartheid Securicor Gray, a security company, went into Nigeria in July 2001 to government, now listed on the New York Stock Exchange – is look after MTN’s security. Now, in partnership with a local investment struggling to grow beyond southern Africa. It is exploring in Australia firm, Capital Alliance, it has a security contract for Nigerian Breweries. and Qatar, and has a big new joint venture with ChevronTexaco of the An SA consortium, including engineering company Entech, the United States to exploit the potential of Sasol’s gas-to-liquids (GTL) Victoria & Alfred Waterfront company (owner of Cape Town’s or gas-to-diesel process. Sasol has committed over $850 mn. to GTL, biggest tourist attraction), Planning Partners and technology/research which involves converting cheap natural gas to high-value low- organisation CSIR’s Environmentek, has won a multi-million dollar sulphur diesel fuel for markets with high environmental standards; a tender from Lagos State for rehabilitation of the popular Bar Beach $120 mn. GTL project is under development at Escravos, Nigeria. area. Protea Hotels operates nine hotels in Nigeria. Others with Transport parastatal Spoornet runs freight services in Cameroon, to Nigerian plans include Kagiso Publishing (government publishing which it has sold passenger rolling stock. It has a memorandum of and printing), arms manufacturer Denel (seeks joint ventures), phone understanding with the Nigerian Railway Corporation and is exploring company Plessey, banking software specialists Misys and Global a potential railway corridor between Lagos and Accra – and leasing Technology, Enviroserv Waste Management, Water South Africa, of railway stock. Portnet, which manages SA’s seven commercial Absa Corporate and Merchant Bank, construction company Basil ports, is looking at rehabilitation of port facilities in Lagos. Read and Boston City Campus. African governments welcome South African investors who promise Pan-African profits to bring in scarce capital and improve services. In Nigeria, Eskom has In 2001 Vodacom, South Africa’s largest cellular phone company, helped NEPA, which used to collect only 50 per cent of its customers’ bought the licence to operate Congo-K’s network. It has set itself a bills, to raise that to 85 per cent. The Director General of Nigeria’s growth target of 25 per cent a year and southern African markets privatisation agency, Nasir el Rufai, is quoted as saying: ‘It took Nitel cannot support that on their own. The next largest cellular network, 70 years to connect 400,000 people and only took mobile operator MTN, hopes to dominate markets in Cameroon, Nigeria, Swaziland MTN eight months.’ On electricity he said: ‘South Africa has an and Uganda. MTN’s first foreign cellphone operation opened in 1996 excess of what Nigeria cannot even generate.’ He might not have said in Rwanda, where it now has 42,000 subscribers, and expects annual that of investors from outside Africa. growth at over 40 per cent. Swaziland, Uganda and Cameroon are ● In Africa Confidential Vol 43 No 19 of 27 September 2002 (Africa/Iraq: next; the big target is Nigeria, where MTN paid $285 mn. for a GSM Uranium trail) we said Johannes Vorster had done a uranium deal with Baghdad licence (its SA licence cost only $10 mn.). In South Africa, MTN was in 1986. A loyal reader points out that Vorster had died in 1983 and ‘it was very able to use facilities owned by state-owned Telkom but in Nigeria it much the Groot Krokodil who dictated political affairs’ in 1986, i.e. P.W. Botha will have to spend over $140 mn. to build its own transmission was very much in power. Our apologies. network plus, due to unreliable power supply, $240 mn. more for generators. The potential profits are huge. South Africa, with a Visit our website at: www.africa-confidential.com population of about one-third of Nigeria’s 130 mn. people, has nearly Published fortnightly (25 issues per year) by Africa Confidential, at five mn. fixed lines and some nine mn. mobile users. Nigerians have 73 Farringdon Road, London EC1M 3JQ, England. only about 400,000 fixed lines, which often don’t work. MTN aims Tel: +44 20-7831 3511. Fax: +44 20-7831 6778. Copyright reserved. Editor: Patrick Smith. Deputy Editors: Gillian Lusk for 203,000 subscribers by next March and forecasts a profit on its and Thalia Griffiths. Administration: Clare Tauben and Juliet Amissah. Nigerian investment by March 2004. Lazarus Zim, MD of MTN International, shuttles to Lagos and has Obasanjo’s support. Annual subscriptions including postage, cheques payable to Africa Confidential in advance: MTN’s larger rival, Vodacom, already present in Tanzania, Lesotho Institutions: Africa £312 – UK/Europe £347 – USA $874 – ROW £452 and Mozambique, is eyeing Zambia and Ghana. In Congo-K, it has Corporates: Africa £404 – UK/Europe £425 – USA $985 – ROW £531 invested $39 mn. in Congolese Wireless Network, with 22,000 Students (with proof): Africa/UK/Europe/ROW £87 or USA $125 customers and 18 years remaining of a 20-year licence; Vodacom now All prices may be paid in equivalent convertible currency. We accept effectively controls the company through a joint venture. Congo-K’s American Express, Diner’s Club, Mastercard and Visa credit cards. Subscription enquiries to: Africa Confidential, PO Box 805, Oxford OX4 60 mn. people have only 100,000 phones between them; MTN estimates 1FH England. Tel: 44 (0)1865 244083 and Fax: 44 (0)1865 381381 the potential market for mobiles at five per cent of the population, or Printed in England by Duncan Print and Packaging Ltd, Herts, UK. three mn. customers. (Sait of Belgium already has 30,000 customers, ISSN 0044-6483

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continues his probe into bribery payments in Pointers ZIMBABWE connection with the sale of arms to the Angolan government (AC Vol 42 No 5). Destribas is sought in connection with MOROCCO Not too smart Glencore’s role in enabling a massive US$930 More international criticism greeted President million oil-for-arms deal. The firm helped pre- Horse-trading Robert Mugabe’s landslide in the 28-29 finance crude oil sales with France’s Paribas in an September local elections but ‘smart sanctions’ operation led by banker Jean Didier-Meil, Islamist politicians and Francophone analysts imposed on him and his officials are having almost currently with Glencore. Brenco, a company agree on one thing, at least: the longer the outgoing no effect. United States officials, Amnesty headed by Pierre Falcone, who has been detained coalition partners, the Union Socialiste des Forces International and the Commonwealth Human over Angolagate, supplied the arms. Populaires and Parti de l’Istiqlal, wrangle over Rights Initiative said the polls, in which the Currently ensconced at Glencore’s London who governs, the greater the chances that the Zimbabwe African National Union-Patriotic Front offices, Destribas expresses confidence that he Islamist Parti de la Justice et du Développement won over 90 per cent of the 1,424 wards, were won’t soon be seeing the inside of a French gaol. will join a coalition government. shrouded in fear and intimidation. The opposition Russian financier Arkady Gaidamak, sought In generally free and fair elections on 27 Movement for Democratic Change said it was earlier in the Angolagate enquiries, is believed to September – which lacked the sort of management barred from registering candidates in 700 wards. have evaded a similar arrest warrant while in the late King Hassan II’s Interior Minister Driss Travel bans imposed by the USA and European London and now spends much time in Israel. Basri specialised in – some 55 per cent of electors Union on leading ZANU-PF officials and their Glencore has had huge and profitable success voted 22 parties into the new 325-seat legislature. business backers are flouted with impunity. The in developing its pre-financed oil sales with Smaller parties now vie for portfolios. EU can’t agree how to handle a summit on 7-8 Angola. Payments from the sales are entered into Such is the political vacuum that Premier November with leaders of the Southern African a Swiss account with Paribas. Abderrahmane el Youssoufi has decided to Development Community. Britain wants Besides helping develop this pre-financed oil overcome his ailments to stay on for two more Zimbabwe barred but host Denmark was told that trade, Destribas is known in West Africa as the years, despite having stressed he would retire. excluding Zimbabwe would prompt a SADC trader who supplied refined product cargoes to King Mohammed VI (AC Vol 43 No 15) sees his boycott. Mozambique offered to host the summit General Sani Abacha under terms highly father’s old opponent as indispensable to his to spare Denmark the embarrassment. beneficial to the late Nigerian dictator. Some democratic opening up. Economic exclusion may hit Mugabe harder. cargoes later attracted claims that dangerously The PJD grabbed the headlines with 42 seats Last month the International Monetary Fund sub-standard cheap fuel was entering to Nigeria. (with 11 per cent of the vote, won by standing in suspended Harare’s voting rights because it failed Those implicated in the scandal are hoping the only 56 of the 91 constituencies). Youssoufi’s to pay US$100 million arrears. We hear the end of ‘cohabitation’ between Gaullist President USFP took 50 seats (down 57 on 1997) – only 12 World Bank is also disengaging. Late last month Jacques Chirac and the Socialist Party will close per cent of votes. The PI won 48 seats,10 per cent. it quietly transferred its Resident Representative down the Angolagate investigations as inside Veteran Ahmed Osman’s centrist Rassemblement Ohene Nyanini to Lusaka and will keep a residual information damaging to the Elysée dries up. National des Indépendents lines up its usual share staff in Harare. The Bank had sought a social of ministerial patronage with 41 seats. safety net programme to help people hit hardest by USA/AFRICA The PJD breakthrough showed the extent of the economic crisis but with arrears at some $150 Islamist support in towns, where Sheikh mn., its non-accrual rules bar new programmes. Millennial Abdessalam Yacine’s harder-line Al Adl wal It wants to grant about $20 mn. for an anti-HIV/ Ihsane (Justice and Charity) is more entrenched AIDS programme if it can channel money through US government departments are fighting for and popular than the PJD’s Abdelillah Benkirane non-governmental organisations. After seeing control of President George W. Bush’s trumpeted and Mustapha Ramid. Yacine’s supporters and the politicisation of food aid, Bank managers Millennium Challenge Account, eventually worth some others claim the PJD maintains Basri-era want to avoid government channels. Meanwhile US$5 billion a year. The Treasury and State links to the authorities. The official PJD leader is a four-month stand-off between the government Department want to stop the MCA, which ‘Dubya’ infirm nationalist Abdelkrim el Khatib, whose and UN Development Programme over a $85 mn. announced at March’s Financing for Development party (then the Mouvement Populaire food aid fund continues. Harare insists its own conference in Monterrey, Mexico, going to the Constitutionnel et Démocratique) Benkirane and Grain Marketing Board control the money; the US Agency for International Development. But allies entered in the mid-1990s. UNDP wants access to the fund for private USAID Director Andrew Natsios told Africa The PJD won’t join a USFP-led coalition. But companies and NGOs to ensure food reaches Confidential he was determined to keep his agency in case Youssoufi’s coalition-building fails and opposition-supporting areas, too. – with its experience of development – involved. Mohammed delays appointing a premier, The prize is great. Over five years, the MCA means ambitious PI leader Abbas el Fassi has been FRANCE/ANGOLA a 50 per cent increase of annual US aid of around $10 canvassing smaller parties for support. If more bn. It has bipartisan support in Congress. The votes are needed, PI’s traditional Arab/Islamic Office of Management and Budget is preparing a ideology might accommodate the PJD. Going for Glencore detailed proposal. Bush will decide in the coming PJD Deputy Secretary General Saad Eddine Swiss-based oil and commodities trader Glencore weeks which department wins the turf war. el Othmani quickly ruled out joining a USFP-led has become entangled in France’s Angolagate Treasury and State don’t trust USAID to be government but didn’t exclude alternatives – scandal. Paris sources say an arrest warrant has tough enough with the cash, which will reward a provided his party could secure such priorities as been issued for one of the company’s leading small band of poor countries that Washington the Education portfolio and promoting ‘Islamic West African oil traders, Frank Destribas, as deems serious about political and economic reform preferences’ in North Africa’s most open society. Investigating Magistrate Pierre Courroye – and loyal allies in the ‘war against terror’.