Zimbabwe a challenge for South Africa

Although the crisis in Zimbabwe was a cause of concern for South Africa, Pretoria officials argued that additional pressure such as sanctions had little effect on President Robert Mugabe and could destabilise the country with spillover effects in South Africa.

Washington wanted South African President Thabo Mbeki who had been appointed by the Southern African Development Community as the mediator in Zimbabwe to put pressure on Mugabe to stop human rights abuses against the opposition.

Reports said one to two million Zimbabweans had already fled to South Africa.

Washington considered South Africa a key partner in Africa though Pretoria sometimes took positions that ran counter to United States interests.

Under Mbeki South Africa had taken up the cause of a greater “South” voice in international institutions, increased development assistance, an expanded UN Security Council, and lower trade barriers.

Full cable:

Viewing cable 07PRETORIA3778, SCENESETTER FOR SENATOR KERRY’S VISIT TO SOUTH

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UNCLAS SECTION 01 OF 05 PRETORIA 003778

SIPDIS

SIPDIS

SENSITIVE

FOR SENATOR KERRY FROM AMBASSADOR ERIC BOST

E.O. 12958: N/A

TAGS: PREL PGOV SF

SUBJECT: SCENESETTER FOR SENATOR KERRY’S VISIT TO SOUTH

AFRICA

PRETORIA 00003778 001.4 OF 005

¶1. (SBU) Senator, I warmly welcome your upcoming visit 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 weeks before

the African National Congress (ANC) elects its new

leadership. Because the ANC has overwhelming support in the

country (70 percent in the last election), the person who

wins the ANC election in December will likely become the next

president of the country. I look forward to discussing the

evolving political situation with you, as well as the other

key elements of the U.S.-South Africa relationship. I know

our staffs are in touch on the details of your visit, but

please feel free to contact me directly if you have questions

or special requests.

¶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:

closing the gap between the historically privileged and

disadvantaged communities — primarily through

government-provided housing, electricity, and water to the

poor — and creating employment and business opportunities.

South Africa, however, continues to face daunting challenges,

including income inequality between blacks and whites,

massive unemployment, entrenched poverty, violent crime, and

a severe HIV/AIDS pandemic. These problems are intensifying

political tensions within the ANC-led ruling coalition. The

next ANC president will be selected at the party’s December

16-20, 2007 national conference. While the likely victor is

still unclear, current SAG President Thabo Mbeki and ANC

Deputy President Jacob Zuma appear to be the leading

candidates.

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

continent’s best prospect for establishing a successful

democratic society with widespread prosperity. South Africa

plays a key role in promoting peace and stability in Africa,

and is an important voice on global trade 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 on the African

continent and work together closely on many of them.

——————

POLITICAL OVERVIEW

——————

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

political scene in South Africa. President Thabo Mbeki began

his current five-year term on April 27, 2004. The ANC won 70

percent of the vote, and 279 of 400 seats in the National

Assembly at the April 14, 2004 poll. A subsequent “floor

crossing” period in September 2005, in which parliamentarians

were allowed to switch parties, boosted the ANC’s total to

¶293. The ANC also won 66 percent of the vote nationally in

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.

¶5. (SBU) The ANC is part of a tripartite alliance whose other

members are the South African Communist Party (SACP) and the

Qmembers are the South African Communist Party (SACP) and the

Congress of South African Trade Unions (COSATU). The ANC-led

alliance has developed schisms in recent years, largely based

on the SACP’s and COSATU’s more populist styles, as well as

opposition to the government’s economic policies. However,

the alliance is likely to hold together, at least in the

short term. Despite their dissatisfaction with many ANC

policies, most SACP and COSATU leaders remain intensely loyal

to the ruling party and prefer to lobby for change from

within. Splitting from the alliance and fielding candidates

independently would have catastrophic electoral results for

SACP and COSATU

¶6. (SBU) Though Mbeki had a 77 percent public approval rating

in January 2006, his popularity within the party is lower.

Mbeki is currently embroiled in managing internal party

tensions related to succession and his centralized

PRETORIA 00003778 002.2 OF 005

decision-making style. Supporters of Jacob Zuma accuse Mbeki

of conspiring against his party deputy; using charges of rape

(on which Zuma was acquitted in May 2006) and corruption

(state prosecutors continue to investigate Zuma) to ensure

Zuma does not become the next ANC president. Many within the

party’s grassroots also think Mbeki does not consult with ANC

structures before making decisions, such as when he overrode

the selection of several hundred local candidates by ANC

branches to ensure gender parity on party lists for the March

2006 local elections. Mbeki’s legacy will depend in large

part on who is elected ANC President at the December party

conference. Mbeki, who is also the current party president,

has not declared his candidacy, but is widely expected to

run. If he wins, he will remain safely at the helm until his

state presidential term expires in 2009. If he loses, he

faces lame-duck status.

——————————————

FOREIGN POLICY – FOCUS ON PROMOTING AFRICA

——————————————

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

promoting Africa’s development. 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 to strengthen economic and

political governance across the continent and a framework for

productive partnership with the international community.

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

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

responsibility to participate in conflict resolution and

peace support operations. South Africa played a leading role

in negotiations that ended 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

Comoros. While the U.S. has a strong policy interest in

seeing South Africa expand and enhance its peace support

capabilities, our ability to support these efforts has been

limited by the suspension of FMF military assistance because

of the lack of an Article 98 agreement with South Africa.

South Africa participates in the African Contingency

Operations Training and Assistance program (ACOTA) to enhance

the capacity of the South African National Defense Force

(SANDF) for participation in multilateral peace support

operations.

¶9. (SBU) Zimbabwe remains a continuing challenge and

increasing concern for President Mbeki. In March, regional

SADC leaders appointed Mbeki as official mediator between

Zimbabwean President Robert Mugabe and the opposition

Movement for Democratic Change (MDC). Negotiations are

ongoing, but human rights abuses against the opposition

continue. While South Africa wants political and economic

reform in Zimbabwe, SAG officials argue that additional

pressure, such as imposing sanctions, would have little

effect on President Mugabe and could destabilize Zimbabwe

with spillover effects in South Africa. South Africa already

Qwith spillover effects in South Africa. South Africa already

hosts between 1 and 2 million Zimbabwean refugees.

¶10. (SBU) While overall U.S.-South African relations are

positive, 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 “South” voice in

international institutions, increased development assistance,

an expanded UN Security Council, and lower trade barriers.

—————————————–

THE ECONOMY AND THE STRUGGLE TO TRANSFORM

—————————————–

¶11. (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 $5,209 (2006),

PRETORIA 00003778 003.2 OF 005

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

government’s fiscal and monetary policies are excellent. The

ANC government steadily reduced the fiscal deficit from

nearly 6 percent of GDP in 1994-95 to a small surplus (0.3

percent of GDP) in 2006-07. The South African Reserve Bank

(SARB) is independent and committed to CPIX inflation (CPI

minus mortgage cost) 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

up to 6.5 percent (July 2007). Real GDP growth in 2006 fell

slightly to 5.0 percent from 5.1 percent in 2005. Analysts

expect growth to slow to 4.8 percent in 2007.

¶12. (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 25.5 percent, has only recently

begun to decline, and is significantly higher among black

South Africans than among whites. Income inequality between

white and black South Africans remains high. Poverty is

widespread. Fifty-six percent of black South Africans, but

only four percent of whites, live in poverty. Nevertheless,

the government has made strides in the areas of transfer

payments and public services to close the gap. Nearly 1.9

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

7.6 million people, 3.5 million homes have been provided with

electricity, and nine million people have been connected to

clean water. Eleven million people were benefiting from

social grants in 2006. 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 two million since 1994.

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

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 both social and economic

areas, among these being the fight against crime, increasing

and enhancing infrastructure, provision of services, and

developing tourism.

—————————–

U.S. SUPPORT FOR SOUTH AFRICA

—————————–

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

contributed approximately $1.217 billion toward South

Africa’s development, plus $201 million in credit guarantees.

Currently, our development assistance program focuses on

HIV/AIDS and strengthening the healthcare system, addressing

unemployment through job-skills training and education,

creating models for efficient service delivery, and reducing

gender-based violence as part of the President’s Women’s

Justice and Empowerment Initiative (WJEI). 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).

¶15. (U) Twenty eight U.S. government entities are represented

at our Mission in South Africa (Embassy Pretoria and the

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

Mission has 281 U.S. employees, and 564 local employees.

QMission has 281 U.S. employees, and 564 local employees.

More than 40 percent of Mission staff provide 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, we completed the new Consulate

compound in Cape Town, and in FY 2006 broke ground on a new

Consulate building in Johannesburg. In FY 2009, we intend to

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

——————————

U.S.-S.A. TRADE AND INVESTMENT

——————————

¶16. (SBU) U.S.-South Africa trade grew 23 percent in 2006,

totaling $11.7 billion. U.S. exports were up 16 percent at

$4.2 billion, while South African exports to the United

States increased 28 percent at $7.5 billion. In 2005, South

Africa was the 35th largest trading partner of the United

PRETORIA 00003778 004.4 OF 005

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 in 2006, and the

largest beneficiary of non-oil products. Its AGOA exports

totaled 21 percent in 2006. 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 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: slow growth, high

unit labor costs, crime, regulatory uncertainty and the

impact of Black Economic Empowerment policies, labor

regulations, HIV/AIDS, and the slow process of privatization.

The U.S. is the second largest foreign direct investor in

South Africa ($5.1 billion at year-end 2005).

¶17. (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. Negotiations are

currently underway.

————————————–

HIV/AIDS: A CRISIS OF EPIC PROPORTIONS

————————————–

¶18. (U) In South Africa, the prevalence rate of HIV

infections is one of the highest in the world. HIV/AIDS is

the country’s leading cause of death. South Africa has a

generalized, mature HIV epidemic and HIV-related care and

treatment services are required across the population. An

estimated five to six million South Africans are

HIV-positive, including 2.9 million women and approximately

300,000 children aged 14 or less. Women in the age group

25-29 are the most badly affected, with prevalence rates of

up to 40 percent. In 2005, an estimated 800,000 more

citizens became infected and in 2006, over 350,000 people

died from AIDS. In 2006, 1.5 million children under the age

of 18 were maternal orphans or had lost both parents.

Sixty-six percent of these 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

orphans and generate additional social and economic

disruption, including orphans being raised by extended family

members or in child-headed households.

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

its National Strategic Plan for HIV, AIDS, & Sexually

Transmitted Infections (STIs) for 2007-2011 (NSP). 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.

Qskilled personnel and laboratory and clinical infrastructure.

Considerable investment in human resources and

infrastructure is necessary to meet the NSP’s national

antiretroviral treatment targets. Approximately 230,000

people are receiving antiretroviral (ARV) treatment as of

2006, while a further 540,000 people need, but are not

receiving, treatment. The Global Fund has provided major

grants to the Western Cape Health Department and a

public-private consortium in KZN.

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

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

public and private sector prevention, treatment, and care

programs. To date, the U.S. has provided almost $460 million

through PEPFAR to support HIV/AIDS programs in South Africa,

with an additional $397.8 million being funded in FY 2007 and

approximately $600 million to be funded in FY 2008, making it

the largest recipient of Emergency Plan resources. In the

fifth year of funding, the Emergency Plan directly supports

PRETORIA 00003778 005.2 OF 005

nearly 146,000 people in ARV treatment through programs in

all provinces. The USG PEPFAR team in South Africa includes

U.S. Agency for International Development (USAID), Centers

for Disease Control (CDC), Department of State, Department of

Health and Human Services (HHS), 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 programs and

collaborates with the U.S. military and NIH on AIDS treatment

research.

¶21. (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

worked 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 mission has prepared, in

coordination with the government, a five-year strategic plan

focused on treatment, prevention, palliative care, and the

provision of care for orphans and other vulnerable children.

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

interlinked. In Southern Africa, between 50 and 88 percent

of TB patients are HIV positive and TB is the most common

infectious disease associated with HIV in sub-Saharan Africa.

A high overall prevalence rate for HIV in South Africa 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.

BOST

(36 VIEWS)