South Africa is anchor in US-Africa policy


South Africa was an anchor country in United States-Africa policy but Zimbabwe remained a continuing challenge and an increasing concern to Pretoria because President Robert Mugabe showed little willingness to open the political environment and allow free and fair elections.

But while South Africa wanted political and economic stability with reform in Zimbabwe, South African government officials argued that additional pressure, such as public criticism or additional sanctions, would have little positive effect on President Mugabe and could destabilise Zimbabwe with spill-over effects in South Africa.


Full cable:



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Reference ID






2008-06-26 15:38

2011-08-30 01:44


Embassy Pretoria



DE RUEHSA #1396/01 1781538


P 261538Z JUN 08

















E.O. 12958: N/A





REF: A. STATE 62586

B. STATE 68515


1. (SBU) I warmly welcome the visit of your delegation to

South Africa. My staff and I stand ready to do everything we

can to make your trip a success. You are visiting South

Africa at a particularly interesting time, only seven months

after Jacob Zuma defeated incumbent Thabo Mbeki as leader of

the ruling African National Congress (ANC). Because the ANC

has overwhelming support in the country (70 percent in the

last election), Zuma is now the leading candidate to become

the next national president following parliamentary elections

expected in March/April 2009.


2. (SBU) South Africa is an anchor country in U.S. Africa

policy. Since the end of apartheid in 1994, the ANC-led

South African Government (SAG) has made major progress toward

establishing a vibrant democracy and market-based economy.

The SAG has focused on political and economic transformation:

reducing the gap between the historically privileged and

disadvantaged communities — primarily through

government-provided housing, electricity, and water to the

poor — and creating educational, skills development,

employment and business opportunities. South Africa,

however, continues to face daunting challenges, including a

lack of public sector operational capacity, a thirty percent

shortfall in mid-to-upper-level public sector managers,

skills shortages in all sectors of the economy, growing

infrastructure bottlenecks, energy shortages, income

inequality between haves and have-nots, less than adequate

educational opportunities, massive unemployment, entrenched

poverty in both rural and urban areas, violent and widespread

crime, and a severe HIV/AIDS pandemic. These problems are

intensifying political tensions within the ANC-led ruling

coalition and with other political, civil society, and

private sector groups. The tense debate at the party’s

December 16-20, 2007 national conference and defeat of

incumbent Mbeki reflected the growing impatience with the

pace of socio-economic change particularly for those who have

not benefited sufficiently from the modest economic growth.

The recent xenophobic and inter-ethnic violence — which

resulted in more than 60 deaths and tens of thousands of

displaced persons around the country — is also in large part

a reflection of the growing restlessness and dissatisfaction

with the ANC’s inability to deliver a better life for

everyone, especially when it comes to employment and housing

(which was constitutionally promised to everyone).


3. (SBU) Despite its many challenges, South Africa remains

the continent’s best prospect for establishing a successful

democratic society with expanding prosperity. South Africa

is a leader of aid-recipient countries in their dialogue with

donor nations, plays a key role in promoting peace and

stability in Africa, and is an important voice on global

trade, human rights, conflict resolution, and

nonproliferation issues. U.S.-South African relations are

stable, as reflected by President Bush’s July 2003 visit to

South Africa and President Mbeki’s June 2005 and December

2006 trips to Washington. We share objectives in common on

the African continent and beyond, and we work closely

together on many of them.







4. (SBU) The African National Congress (ANC) dominates the

political scene in South Africa. The ANC won 70 percent of

the vote and 279 of 400 seats in the National Assembly in the

April 14, 2004 elections. Subsequent “floor crossing”

periods, in which parliamentarians were allowed to switch

parties, boosted the ANC’s total to 297. The ANC also won 66

percent of the vote nationally in the March 2006 local

elections. The Democratic Alliance (DA) is the largest of

several opposition parties in parliament, with 47 seats. The

ANC leads the administrations in all nine of South Africa’s

provinces and in the vast majority of its municipalities.

The most visible exception to this country-wide ANC

domination is the DA’s control of the Cape Town municipality

where there have been multiple attempts by the ANC to unseat

the DA-led, multi-party, municipal government coalition.


5. (SBU) The December 2007 ANC National Conference in


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Polokwane, Limpopo significantly shifted power within the

ruling party. New ANC President Jacob Zuma defeated

incumbent, national President Thabo Mbeki by a vote of 2,329

to 1,505. Zuma,s allies swept the other top five ANC

leadership positions. The Zuma camp also dominated the

elections for the ANC,s 86-member National Executive Council

(NEC) with sixteen Mbeki Cabinet members (out of 28) losing

their NEC seats. While Zuma,s victory makes him the

frontrunner to become national President following the 2009

parliamentary elections, the December 28 indictment of Zuma

on corruption and fraud charges complicates Zuma,s political

future. Zuma,s political allies have alleged that the

corruption case is politically-motivated, a charge

prosecutors and Mbeki strongly deny. Zuma has stated he will

step down as ANC President if convicted. If convicted and

sentenced to more than 12 months imprisonment, Zuma would be

constitutionally prohibited from running in the 2009

parliamentary elections, effectively blocking his succession

to the national presidency. However, with the slow movement

of the judicial process, it is highly unlikely that Zuma,s

trial will begin prior to the 2009 parliamentary elections,

practically assuring that he will become South Africa,s next



6. (SBU) It is too soon to tell whether the dramatic events

at the ANC National Conference will result in any significant

changes in South African Government policy. Mbeki remains in

control of the government until 2009 and the ANC

conference,s policy resolutions did not advocate any

sweeping changes. New ANC President Zuma has stressed that

he will not make any radical shifts and would respect the

party,s previous policy traditions, statements, and

consensus. However, many of the new ANC leaders – and

Zuma,s strongest coalition supporters – come from the left

wing of South African politics. The Congress of South

African Trade Unions (COSATU) and South African Communist

Party (SACP), formally members of the ANC-led tripartite

alliance, will likely pressure Zuma to embrace more leftist

or perhaps even populist positions in the interests of the

poor and the working class. On issues like HIV/AIDS and

Zimbabwe, this could lead to SAG policies more closely in

line with U.S. interests, although on other issues like

fiscal management, nationalization of industry/resource

sectors, and trade liberalization, the shifts in policy might

be less positive from a U.S. perspective. It is also

possible that the newly elected ANC leaders might be more

seized with domestic rather than continental or global

issues, which could reduce the country,s current activist

role in international affairs.


——————————————— ————


——————————————— ————


7. (SBU) Visa ineligibilities related to anti-apartheid

activities pose a significant strain on the U.S.-S.A.

bilateral relationship. South African leaders routinely

raise the frustration and humiliation they associate with

trying to travel to the U.S. despite what have been good

faith efforts by the Consular Bureau (CA) and others to

expedite their travel. These efforts include expedited

Qexpedite their travel. These efforts include expedited

waivers of ineligibility, including a multi-year and

multiple-entry waiver for highly regarded former President

Nelson Mandela, facilitated personally by Secretaries Rice

and Chertoff. Other high profile persons such as businessman

and anti-apartheid activist Tokyo Sexwale have also been

affected. Legislation which placed high-level officials and

heroes of the anti-apartheid movement into the category of

“terrorist” undercuts our efforts to influence South African

government policy on issues such as the designation of

terrorist supporters and financiers at the United Nations

Security Council.


8. (U) On April 9, 2008, Secretary Rice spoke before a

Congressional hearing regarding the visa waiver issue and

advocated the need to change the legislation. In May 2008,

the House passed, and the Senate is currently considering,

legislation lifting terrorism ineligibilities from certain

South Africans. The new legislation allows the flexibility

to end visa ineligibilities for anti-apartheid activists

whose only crime was fighting the odious apartheid regime. It

is important to note that the ineligibilities stemmed not

from membership in the ANC (they affected non-ANC members


PRETORIA 00001396 003 OF 007



also), but from activities occurring during the apartheid







9. (U) South Africa has taken a high-profile role in

promoting Africa’s development – the African Renaissance.

South Africa served as the first chair of the African Union

until July 2003 and helped establish continental institutions

such as the Pan-African Parliament (which sits in South

Africa) and the AU Peace and Security Council. President

Mbeki is the driving force behind the New Partnership for

Africa’s Development (NEPAD), an African-developed program

based on international best practices and continental peer

review to strengthen economic and political governance across

the continent and a framework for productive partnership with

the international community. These initiatives have not

progressed beyond talk-shop stages and have not advanced to

become effective mechanisms for development.


10. (SBU) South Africa recognizes that, by virtue of its

regional political, economic, and military clout, it has a

responsibility to participate in African conflict resolution

and peace support operations. South Africa is playing a

leading role in negotiations to end the conflicts in Burundi

and the Democratic Republic of Congo. Approximately 3,000

personnel are deployed in UN, African Union, and bilateral

peace support operations in Sudan, Burundi, DRC,

Ethiopia/Eritrea, and the Comoros. The U.S. has a strong

interest in seeing South Africa expand and enhance its

peacekeeping and disaster assistance capabilities. South

Africa participates in the African Contingency Operations

Training and Assistance program (ACOTA) to enhance the

capacity of the South African National Defence Force (SANDF)

for participation in multilateral peace support operations.

We are using International Military Education and Training

(IMET) funds to support professional military education and

technical training of future military leaders and to assist

the SANDF in improving management of its defense

establishment. In light of the January 2008 repeal of ASPA

prohibitions on provision of military assistance, we hope

soon to resume Foreign Military Financing (FMF) programs

aimed at enhancing the South African Air Force,s strategic

airlift capability by funding C-130 annual maintenance,

upgrades, technical support, and flight simulator training.


11. (SBU) Zimbabwe remains a continuing challenge and

increasing concern for South Africa. In March 2007, regional

SADC leaders appointed Mbeki as official mediator between

Zimbabwean President Robert Mugabe and the opposition

Movement for Democratic Change (MDC) with the goal of

leveling the playing field in advance of March 2008

elections. Negotiations made some progress, but human rights

abuses against the opposition continued. Mugabe has shown

little willingness to open the political environment and

allow free and fair elections. While South Africa wants

political and economic stability with reform in Zimbabwe, SAG

officials argued that additional pressure, such as public

criticism or additional sanctions, would have little positive

effect on President Mugabe and could destabilize Zimbabwe

Qeffect on President Mugabe and could destabilize Zimbabwe

with spillover effects in South Africa. South Africa already

hosts between 1 and 2 million Zimbabwean refugees. In the

March 29, 2008 elections, the MDC won a small majority of

seats in the Parliament, and its leader Morgan Tsvangirai

officially won a majority of the vote (47 percent) but not

enough to avoid a runoff with incumbent president Robert

Mugabe. Presidential runoff elections planned for June 27,

2008 have been preceded by a terrible campaign of

state-sponsored violence and intimidation that has undermined

the prospects for a free and fair electoral contest. Some

critical analysts and observers contend that the election may

have been stolen before any votes were cast. As a result of

the political instability, Tsvangirai dropped out of the race

on June 22.


12. (SBU) Overall U.S.-South African relations are positive,

but South Africa sometimes takes positions on global issues

that run counter to U.S. interests. As a non-permanent UN

Security Council member, and former chair of the G-77 and the

Non-Aligned Movement (NAM), South Africa has taken up the

cause of a greater voice for the “South” relative to the


PRETORIA 00001396 004 OF 007



“North” in global finance, international institutions,

increased development assistance, an expanded and reformed UN

Security Council, and lower trade barriers (for manufactured

and agricultural exports to developed countries).






13. (SBU) As the dominant and most developed economy in

sub-Saharan Africa, South Africa is markedly different from

other countries of the region. It is a middle-income,

emerging market economy with GNI per capita of $5,670 (2007),

akin to Chile, Malaysia, or Thailand. The South African

government’s fiscal and monetary policies are excellent, but

have been criticized as being too conservative by the

increasingly influential COSATU, SACP, and ANC Youth League.

The ANC government steadily reduced the fiscal deficit from

nearly 6 percent of GDP in 1994-95 to a small surplus of 0.6

percent in 2006-07 and 0.9 percent in 2007-08. The South

African Reserve Bank (SARB) is independent and committed to

returning CPIX inflation (CPI excluding mortgage interest

costs) within a target band of 3.0 to 6.0 percent. Inflation

fell from 12.4 percent at the beginning of 2003 to 4.8

percent in June 2006, but has recently crept back up to 10.4

percent (April 2008). The SARB now does not believe

inflation will return to within the maximum level of the

target band until the end of 2010. Real GDP growth was 5.1

percent in 2007. The South African National Treasury expects

growth to slow to 4.0 percent in 2008 and 4.2 percent in

2009. However, this growth is measured against an

increasingly strained energy supply which has led to power

shortages. Because of this, rising inflation and higher

interest rates, some local economists expect growth to slow

to as little as 3.0 to 3.5 percent.


14. (SBU) South Africa’s single greatest economic challenge

is to accelerate growth. GDP growth averaged 3.0 percent per

year between 1994 and 2004 and was not sufficient to address

widespread unemployment and reduce poverty. The official

unemployment rate, currently 23.0 percent, has only recently

begun to decline and is significantly higher among black

South Africans than among whites. Income inequality between

haves and have-nots remains one of the highest rates in the

world. Poverty is widespread. Fifty-six percent of black

South Africans, but only four percent of whites, live in

poverty. The lack of capacity and service delivery at the

provincial and municipal levels has fueled the recent

xenophobic attacks as South Africans from lower socioeconomic

strata feared that jobs, houses, and other services were

being given to refugees from neighboring countries. Other

obstacles exacerbating South Africa,s unemployment and

economic problems are skill shortages and education system

weaknesses. The media reports regularly about a growing

brain-drain of technically skilled workforce professionals,

including medical staff, to other countries. Nevertheless,

the government has made strides in the areas of transfer

payments and public services to close the gap. Nearly 2.5

million low-cost homes have been built to provide shelter to

7.6 million people, 3.5 million homes have been provided with

Q7.6 million people, 3.5 million homes have been provided with

electricity, and nine million people have been connected to

clean water. Almost 12.4 million people were benefiting from

social grants in 2007 (compared to the country’s five million

individual taxpayers). The government’s broad-based Black

Economic Empowerment (BEE) program provides ownership and

employment opportunities to blacks and has helped the black

middle class double to an estimated two million since 1994.

The black middle class has expanded appreciably over the last

year, increasing by 30 percent. Of the approximately 48

million person population, 6.0 million belong to the middle

class, with 3.4 million being whites and 2.6 million being



15. (U) The success in preparing for and carrying off the

FIFA 2010 Soccer World Cup to be held in South Africa is

regarded by many as a bellwether of the country’s commitment

to continued progress in a variety of social and economic

areas, among these being the fight against crime, expanding

and improving infrastructure, providing services, and

developing tourism.


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PRETORIA 00001396 005 OF 007



——————————————— —–


16. (U) South Africa’s transport infrastructure is well

developed and is the best in Africa. There are sizeable and

efficient ports, a road network that is mostly excellent, and

good air links, particularly to Europe and the U.S. and

increasingly to Asia and the rest of Africa. The network of

rural secondary roads is less well-developed. Transport

policy has led to a shift from rail to road since the

liberalization of transport in the mid-1980s and a relative

lack of investment in rail. Lack of control over

heavy-vehicle overloading has led to significant damage to

the road network and substantial backlogs in maintenance.


17. (U) State-owned Transnet owns and operates port

facilities, including the Port of Durban, the largest in

Africa. Transnet Freight Rail (formerly known as Spoornet)

runs an extensive rail network, including spurs to transport

coal from Mpumalanga coal-fields to the Richards Bay Coal

Terminal and iron ore from the Western Cape to the port of

Saldanha. The government has not allowed private investment

in rail lines. There has been substantial under-investment

in locomotives and rolling stock. South Africa Airways has

direct flights to the U.S., Europe, and Asia and is a

world-class airline. It cannot effectively position itself

as an international hub, however, because of its location at

the end of the African continent, so it has focused more

recently on travel within Africa.






18. (U) Since 1994, the United States Government has

contributed approximately $1.2 billion toward South Africa’s

development, including $201 million in credit guarantees.

Currently, our development assistance program focuses on

strengthening the healthcare system, addressing unemployment

through job-skills training and education, creating models

for efficient service delivery, reducing gender-based

violence as part of the President’s Women’s Justice and

Empowerment Initiative (WJEI), as well as HIV/AIDS through

PEPFAR. A wide range of U.S. private foundations and NGOs

are also at work in South Africa. Among them are the Gates

Foundation (HIV/AIDS), the Ford Foundation (higher

education), and the Rockefeller Foundation (adult education).


19. (U) Twenty-eight U.S. government entities are represented

at the U.S. Mission in South Africa (Embassy Pretoria and the

three Consulates in Cape Town, Durban, and Johannesburg).

The Mission has 318 approved U.S. positions (only 241 are

filled) and 570 local employees. More than 40 percent of

Mission staff provides regional services to other U.S.

embassies in Africa. The Mission has embarked on an

ambitious program to build safe office facilities. In FY

2005, the Mission completed the new consulate compound in

Cape Town. In FY 2009, the Mission will complete a new

consulate building in Johannesburg and in FY 2010 intends to

break ground on a new 155-desk office annex in Pretoria.






20. (SBU) U.S.-South Africa trade grew 22 percent in 2007,

totaling $14.3 billion. U.S. exports were up 23 percent at

$5.2 billion, while South African exports to the United

Q$5.2 billion, while South African exports to the United

States increased 22 percent at $9.1 billion. In 2007, South

Africa was the 34th largest trading partner of the United

States, equivalent to Turkey or Chile. It is the largest

U.S. export market in sub-Saharan Africa, twice the size of

Nigeria and equal to Russia or Argentina. South Africa was

the third largest beneficiary of AGOA and the largest

beneficiary of non-oil exports to the U.S. in 2007. Its AGOA

exports totaled 25 percent of the country’s total exports to

the U.S. in 2007. An impressive 98.1 percent of South

Africa’s exports entered the U.S. with zero import duties in

2007 as a result of normal trading relations (NTR), GSP, and

AGOA benefits. Only 1.9 percent of the value of South

Africa’s exports to the U.S. was subject to duty, or $174

million out of $9.1 billion in exports, in 2007. The U.S.

also replaced Japan as the largest export market in 2007.

The U.S. is the third-largest two-way trade partner, after


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Germany and China. Over 600 U.S. firms have a presence in

South Africa with 85 percent using the country as a regional

or continental center. South Africa’s stable government,

sound fiscal and monetary policy management, its

transportation infrastructure, sophisticated financial

sector, and, by African standards, its large market are the

primary attractions for U.S. businesses. South Africa has,

however, failed to attract a proportionate share of foreign

direct investment since 1994. Reasons include high unit

labor costs, labor regulations, skills shortages, crime,

HIV/AIDS, regulatory uncertainty, and the impact of Black

Economic Empowerment policies such as the mandatory sale of

equity to previously disadvantaged persons. The U.S. was the

second largest portfolio investor and the second largest

foreign direct investor in South Africa after the U.K. ($5.5

billion at year-end 2006).


21. (SBU) Following six rounds of negotiations over three

years, the U.S. and the Southern African Customs Union (SACU:

South Africa, Botswana, Lesotho, Namibia, and Swaziland)

agreed in April that they could not conclude negotiations on

a free trade agreement (FTA) by their target date of December

2006. Negotiators subsequently agreed to deepen the

bilateral relationship through a Cooperative Agreement on

Trade, Investment and Development (TIDCA). A framework

agreement for the TIDCA is scheduled to be signed at the

annual AGOA Summit in Washington on July 14, 2008. The next

steps will be to establish working groups in the areas of

sanitary and phytosanitary measures (SPS), technical barriers

to trade (TBT), customs, and trade promotion.






22. (U) South Africa has the largest number of HIV-infected

citizens in the world and HIV/AIDS is the country’s leading

cause of death. South Africa has a generalized, mature HIV

epidemic, and HIV-related prevention, care, and treatment

services are required across the population. An estimated

5.4 million South Africans are HIV-positive including 2.7

million women and approximately 300,000 children aged 14 or

less. An estimated 18.8 percent of adults between 15 and 49

are infected. Women in the age group 25-29 are the most

seriously affected, with prevalence rates of up to 40 percent

in some areas. In 2005, an estimated 800,000 more citizens

became infected, and in 2006, 350,000 adults and children

died from AIDS. An estimated 1.6 million children, or

approximately 10 percent of South Africa’s children, have had

at least one parent die. Sixty-six percent of these children

had been orphaned as a result of AIDS. The number of

AIDS-related deaths since the start of the epidemic is

estimated at 1.8 million, with 71 percent of all deaths in

the 15-41 year old age group being due to AIDS. Continued

AIDS-related mortality will create millions of new orphans

and generate additional social and economic disruption,

including orphans being raised by extended family members or

in child-headed households.


23. (U) In April 2007, the South African Government released

its National Strategic Plan (NSP) for HIV, AIDS, and Sexually

Transmitted Infections. The NSP has the goal of reducing new

QTransmitted Infections. The NSP has the goal of reducing new

HIV infections by 50 percent by 2011 and also aims to boost

provision of anti-retroviral treatment (ART) in South Africa.

However, South African public health facilities suffer from

an acute shortage of skilled personnel and laboratory and

clinical infrastructure. Considerable investment in human

resources and infrastructure is necessary to meet the NSP’s

national anti-retroviral treatment targets. 371,731 people

were receiving anti-retroviral (ARV) treatment as of 2007,

while a further 511,269 people needed but were not receiving

treatment. The Global Fund has provided major grants to the

Western Cape Health Department and a public-private

consortium in KZN. The Global Fund also provides funding to

the National Department of Health to refurbish multi-drug

resistant TB centers and other areas to strengthen the

country,s approach to TB-HIV.


24. (SBU) The President’s Emergency Plan for AIDS Relief

(PEPFAR) is in its fifth year of implementation working with

public and private sector prevention, treatment, and care

programs. To date, the U.S. has provided $1.45 billion

through PEPFAR to support HIV/AIDS programs in South Africa


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including $591 million in FY 2008, making it the largest

recipient of Emergency Plan resources. The Emergency Plan

directly supported 305,356 people in ARV treatment through

programs in all nine provinces as of March 2008. The USG

PEPFAR team in South Africa includes U.S. Agency for

International Development (USAID), Department of Health and

Human Services (HHS) (which includes the Centers for Disease

Control and Prevention (CDC) and the Office of International

Health (OIH)), Department of State, Department of Defense,

and Peace Corps. The team works to ensure that the PEPFAR

strategic plan is aligned with the goals of the NSP. The

South African military has expanded prevention, care, and

treatment programs and collaborates with the U.S. military

and NIH on AIDS treatment research.


25. (U) South Africa has the strongest research and training

capacity of any country in the region, making it an important

partner in the fight against HIV/AIDS. USG agencies work

with national and provincial health departments, the

military, universities, and NGOs to strengthen primary health

care, prevention, disease surveillance, and research.

President Bush and President Mbeki confirmed a mutual

commitment to expand HIV/AIDS collaboration, particularly

through the Emergency Plan.

The U.S. Mission has prepared, in coordination with the South

African government, a five-year strategic plan focused on

treatment, prevention, palliative care, and the provision of

care for orphans and other vulnerable children. Currently,

the U.S. Mission, in coordination with the South African

Government, is defining new priorities, gaps, and needs that

will shape our program for the coming year.


26. (U) The epidemics of HIV and tuberculosis (TB) are

interlinked. TB is the most common infectious disease

associated with HIV in sub-Saharan Africa and approximately

50 percent of HIV patients in Southern Africa also have TB.

A high overall prevalence rate for HIV, people co-infected

with TB and HIV, and lack of continuity in treatment

contributes to the increasing incidence of active TB disease,

including multi-drug resistant (MDR) strains. In conjunction

with HIV, TB is linked to substantially higher fatality

rates, even in the presence of effective TB chemotherapy.



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