Policy issues from South Africa and its neighbours. Reports every two weeks.

v19/04 20 Feb 04

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CONTENTS

Congo
Belgian companies pour cold water on Kabila's hopes


Ongoing unrest in the east delays return of refugees

International
Ministers prepare for WTO


SA government digs itself deeper into a hole on Iraq security

Mozambique
Former World Bank economist is prime minister

Region
EU focuses on trade and aid ahead of historic enlargement

SA development
Mbeki's slow roll-out puts AIDS activists in quandary

SA economy
Capital flight involved 'billions' of Rands
Mbeki stresses 'developmental state' in further economic swing

SA politics
More African missions

Swaziland
Emergency declared in face of all-round crisis

Zambia
Massive strike against austerity plan

Zimbabwe
Sanctions renewed by EU, but without enthusiasm



SA economy:

Mbeki stresses 'developmental state' in further economic swing

SouthScan v19/04 20 Feb 04] The South African budget this week was a further indication of a swing away from the strict neo-liberal guidelines embodied in its Gear (Growth, Employment and Redistribution) policy and together with other political indications may show a shift in the balance of forces in cabinet.

The trade unions welcomed it strongly. Cosatu called it "very positive" and said there was "a welcome 9% increase in the overall budget, which will have a positive impact on the social services - especially social grants - and infrastructure, while expenditure on defence remains restrained"....

Back to the drawing board...

Jobs creation...


SA politics:

More African missions

SouthScan v19/04 20 Feb 04] Reflecting its higher diplomatic profile in the region, South Africa is expected to open 16 new missions in Africa over the medium term period....


SA economy:

Capital flight involved 'billions' of Rands

SouthScan v19/04 20 Feb 04] Billions of Rands were illegally exported from South Africa over the period of its transition to democracy, it was revealed this week.

In his budget speech Finance Minister Trevor Manuel said there was "reasonable progress" with the exchange control amnesty process that offers protection from prosecution to those who come clean on having moved money offshore illegally....


SA development:

Mbeki's slow roll-out puts AIDS activists in quandary

SouthScan v19/04 20 Feb 04] The Treatment Action Group has been caught between a rock and a hard place in its bid to keep South Africa's roll-out of the state anti-retroviral treatment plan on track.

The TAC welcomed the announcement in the budget this week that spending on fighting AIDS is to be boosted by R2.1 billion over the next three years, most going towards the cost of the provincially-administered antiretroviral treatment programmes....


International:

SA government digs itself deeper into a hole on Iraq security

SouthScan v19/04 20 Feb 04] The SA government's high profile anti-mercenarism policy seemed more confused this week after revelations that the South African security company used to guard oil wells in Iraq is a protégé of Washington's front man for the presidency, Ahmed Chalabi.

The company, Erinys, was set up by a group of South Africans including apartheid-era foreign affairs head Sean Cleary and won a $39.5m two-year contract last year to guard Iraqi oil. It operates offshore from the UK and has not sought SA approval to work in Iraq but it appears to fit the profile for prosecution (SouthScan v18/18; 18/21; 19/03)....

Flood of recruits...

British paras...

Diplomatic uncertainty...

Hostile to US policy...

Israel policy...


Region:

EU focuses on trade and aid ahead of historic enlargement

SouthScan v19/04 20 Feb 04] Ahead of the historic enlargement of the European Union on May 1, the meeting between its members of parliament and their ACP (African, Caribbean and Pacific) counterparts managed to deliver some value for sub-Saharan Africa.

The delegates backed proposals linking trade with aid and development, central to the EPA (Economic Partnership Agreement) between the EU and the ACP's individual countries and regional organisations, on which negotiations are soon to start. But few were prepared to take on the likely consequences of the enlargement of the EU on May 1 and the diversion of resources to the agricultural economies of Eastern Europe....

Missing Millennium Goals...

Cotton subsidies...


International:

Ministers prepare for WTO

SouthScan v19/04 20 Feb 04] Trade ministers and officials from a dozen African countries, the EU and the US on Wednesday began two days of informal talks in Kenya aimed at reviving the stalled Doha round of WTO negotiations. African countries represented at the Mombasa meeting were Benin, Botswana, Egypt, Ghana, Kenya, Lesotho, Malawi, Mauritius, Morocco, Senegal, South Africa, Tanzania and Uganda.

Meanwhile the SA side has been playing the US against the EU and Japan. ...


Zimbabwe:

Sanctions renewed by EU, but without enthusiasm

SouthScan v19/04 20 Feb 04] European Union interior and justice ministers on Thursday formally renewed for the third year 'smart' sanctions against Zimbabwe, but the move was low-key and has been widely seen failing to prod President Robert Mugabe and his elite Zanu-PF group into political change.

The ministers adopted an extended list of 95 Zimbabwean officials - including Mugabe - who are banned from entering EU countries and have a freeze on their assets....


Zambia:

Massive strike against austerity plan

SouthScan v19/04 20 Feb 04] Organisers of a massive strike and demonstration against tax increases and wage freezes proclaimed victory this week in an action being seen as a first bite-back against International Monetary Fund economic conditionalities.

Zambia Congress of Trade Unions secretary-general Sylvester Tembo said 90 percent of workers in the public sector heeded the strike call....


Mozambique:

Former World Bank economist is prime minister

SouthScan v19/04 20 Feb 04] President Joaquim Chissano on February 17 appointed Finance Minister Luisa Diogo, a young, former World Bank technocrat, as the country's new prime minister.

The veteran Pascoal Mocumbi, who had been ten years in the office, resigned at his own request and has taken up the position as head of a new international health body, the Europe-Developing Countries Clinical Trial Partnership based in the Netherlands. Observers said he quit because of an internal power struggle but few details have leaked out (SouthScan v19/03)....


Swaziland:

Emergency declared in face of all-round crisis

SouthScan v19/04 20 Feb 04] Swaziland this week declared a state of emergency because of AIDS and the drought and called for more aid. The country's economy is in a shambles and it has been facing a rumbling constitutional crisis for years.

But there are already shortages of funds for food aid and new donors are likely to steer clear while expenditure that has burdened Swaziland with record national debt remains uncontrolled....


Congo:

Belgian companies pour cold water on Kabila's hopes

SouthScan v19/04 20 Feb 04] DR Congo President Joseph Kabila's recent European tour from February 6-12 has brought mixed results. On the positive side he was congratulated by his hosts in Paris, Berlin, London and Brussels for progress in the political field, and Belgian Prime Minister Guy Verhofstad promised that his country would help the DRC to restore the structures of state and support the security sector.

However, on the economic front results may come later than expected by the Congolese president; in Belgium, with the closest links to its former colony, business leaders are being very cautious....

Praise for Leopold...


Congo:

Ongoing unrest in the east delays return of refugees

SouthScan v19/04 20 Feb 04] After six years the 20,000 refugees from the UN High Commissioner for Refugees (UNHCR) camp of Gihembe in Byumba (Rwanda) are not yet ready to return home because of continuing unrest in the eastern Congo. Most are Congolese Tutsis from Northern and Southern Kivu but also from the Nande and Hunde tribes of Northern Kivu and Bashis from Southern Kivu.

The elected spokesman of the refugees, Karasi Rwakwisi, told SouthScan at the end of January that there was still too much insecurity in the Congo. He also complained that President Joseph Kabila did not consider them to be Congolese; they were waiting for recognition as Congolese citizens by the Kinshasa authorities before they agreed to return....

Ituri situation volatile...

Angola to probe expulsions...

MONUC boosts forces in north-east...