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APPROVE~ FOR RELEASE= 2007/02/08= CIA-R~P82-00850R000300050006-7 f 1 ~ i T~~..~. 3 ~ ~ APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007/02148: CIA-RDP82-44850R000300054406-7 F FOR OFFICIAL ~SE ONL1~' JPRS L/9386 7 November 1980 Sub-Saharan Africa Re ort p FOUO No. 696 ` Fg~$ FOREIGN BROADCAST INFORMATION SERVICE FOR OFFiCIAL L1SE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007/02148: CIA-RDP82-44850R000300054406-7 NOTE .7PRS gublications contain informat-ion primarily from foreign nEwspapers, periodicals and books, but also from news agency transmissions and broadcasts. Materials from foreign-language sources are translated; those from English-language sources are transcribed or reprinted, with the original phrasing and other characteristics retained. xeadlines, editorial reports, and material enclosed in brackets are supplied by JPRS. Processing indicat~rs such as ['fext) - or ~Exc~rpt) in the first line of each item, or following the last line of a brief, indicate how the original information was processed. Where no processin~ indicator is given, the infor- mation �aas summarized or e~tracted. Unfami~iar names rendered phcnetically or transliterated are . enclosed in parentheses. Words or names precedeci b;~ a ques- tion mark and enclosed in parentheses were not clear iti the original but have been supplied as appropriate in context. Other unattributed parenthetical notes within the body of an item originate with th.e source. Times within items are as given by source. The contents of this publication in no way ~represent the poli- c ies, views or attitudes of the U.S. Government. COPYRIGHT LAWS AND R~GLTLATi~tdS GOVERNING OWL~IERSHIP OF t~fATERIALS REPRODUCED HEfi'EI?1 REQUIRE THAT DISSE~IINATION OF THI~ PUBLICATION BE RESTRICTED F~R OFFIC IAL USE ONI.Y. ~ APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 FOR OFFiCIAL USE ONLY JPRS L, ~ :~86 7 Noven,c f~r 1980 SUB-SAHARAN AFRICA REPORT FOUO I~o . 696 ~ - CONTElVTS ~ INTER-AFRICAN AFFAIRS . Briefs Angola-Zaire Trade 1 Dji~outi-Tanzania Air Agreement 1 CENTRAL AFRICAN REPUBLIC President Dacko Addresses Nation; Visits France (MARCHES TROPICAUX ET MIDITERRANEENS, 26 Sep 80)......... Briefs Relief �or Birao 4 CHAD Fighting in Capital Intensifies (MARCHES TROPICAUX ET MEDITERRANEENS, 26 Sep 80)......... CONGO Central Committee Luoks Ir~to Improving Economy, Finances (MARCHES TROPICAUX ET MEDITERRANEENS, 12 Sep 80)......... 6 Economic Prospects Improving Because of Contributions of Petroleum ' (MARCHES TROPICAUX ET MEDITERRANEENS, 3 Oct 80).......... 9 Briefs Conference on State Enterprises 14 EDF Financing of CFCO li, ~ DJIBOUTI Data on Port of Djibouti , (MARCHES TROPICAUX ET MEDITERRANEENS, 19 Sep 80)......... 15 - ~ - [II~ - NE & A - 120 FOUO] APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007/02148: CIA-RDP82-44850R000300054406-7 - FOR OFFICIAL USE ONLY ~ LIBERIA Briefs Pxoperty Expropriation Measures i6 - Good Relations With France Restored 16 � Good Relations With EEC Restored 16 MOZANIBIQUE ~ State of Economy, Need for Western Expertise Surveyed (Jacques Latremoliere; MARCHES 1'ROPI:;AUX ET MEDITERRANEENS, ~ 26 Sep 80) 17 NIGER Briefs Southeastern Stockraising Project 24 ' Food Crop Area Expanded 24 NIGERIA . Briefs Police Development Pro~ect 25 Czechoslovak Aid 25 ~ Exchange Reserves Increase 25 Higher Inflation 26 Population in Ibadan 26 Oil Agreement With India 26 Kaduna International Fair 26 Ibadan Trade Fair 27 S EN~.GAL Briefs EEC Delivering Food Aid 28 Z~1IRE Briefs Petroleum Production 29 Report on Mines 29 - Belgian Electricity Contr~~t~ 29 - Oil Prespectir.g 30 - Inga-Shaba Electric Line 30 Small Powerplants 30 FRG-Financed Roads 30 Continued FRG Support 30 -b- - FOR OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007/02148: CIA-RDP82-44850R000300054406-7 FOR OFFICIAL JSE ONLY INTER-AFRICAN AFFAIRS - BRIEFS ANGOLA-ZAIRE TRADE--During the trade negotiations wh ich took place in Kinshasa at the end of July, Zaire and Angola selecte d products for trade between the two countries. Angola will import 2000 tons of palm oil, soap, batik cloth (500,000 meters), bedsheets, 4,000,000 metera of khaki cloth, bicycles and furniture from Zaire. Zair~ would import from Angola crude or refined salt, crude petroleum and derivatives, tar, gypsum, steel r~inforcing bars, molassas, sisaZ fiber, tiles, cement, dried fish, fish flour, and sacks in which to put cement. [TExt] [Paris MARCHES ;ROPICAUX ET MEDITERRANEENS 19 Sep 80 p 2303] 63.08 DJIBOUTI-TANZANIA AIR AGREEMENT--A bilateral air trans portation agree~ent on the use of the international airport of Djibouti was signe d on 11 Sentember 1980 ~y Djibouti civil aviation officials and a TanLanian dele gation headed by Mr - Oleikambeine, director of transportation. [TextJ [Pa ris MARCHES TROPICAUX ET MEDITERRANEENS in French 19 Sep 80 p ~307] 9479 CSO: 4400 - 1 FOR OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007/02/48: CIA-RDP82-00850R000300054406-7 F0~ OFFI~IAL USE ONLY CENTRAL AFRICHIv REPUBLIC PRESIDEIdT DACKQ ADDRESSES ~1ATION; V~Sa.'~S FRANCE - Paris MA..~CHLS TROPICAU% ET M~;DITERRPL'~~LNS in Fr�nch 26 Sep $0 p 2363 [Text] On the occasion of the first :~ren3.versary of the coup d'etat organized by ~ France t~ overthrow the impQrial reg3mU i:~ Central Africa, President Dacko addresserl the natia*~ and paid honage to the "ms.rtyrs whose b1QOd permitted the downfall of the empire." - Addressing rhe youth sector, David Jackr, said that it was the hope of the new repub - lic. The chief oi state also reite~ateri the gratitude of Central Africa vis-a-vis . friendly countr:Les and above all Frar.ce whose "decisive aid restored di~nity to the Central Africans and whose assistance o~rnii_Zted the surmounting of the difficulties of this first ve~.r of ef�orts." "In the coming 12 mor_ths, after 15 years of ~ilence, you will be called upon to express wir.h complete freedo~~ your ~pinion of the structures of our renewed repub- lic," said the chief of state who reported that a draft Constitution had been pre- pared and that the definitive text drawn up uy the government would be presented for ratification. "You will next have the ~,~;portunity of electing the president ' of the republic whom you will charge with :1~a.ding the nation, and you will elect - the members of the National Assemuly." President Dacko said that the governmexit`s principal problem was that of. the present financial crisis. He asserte3 that the gavernr~~ent was forced to implement a aeries - of ineasures designed to eliminate ill-con~idered expenditures, r_o waste. "With the generous aid of the United Nationa, i.n tha firat place, of Frauce and the International ASonetary Fund, we have been able to avoid state bankruptcy; how- _ ever, we are going to have some very diffic.uit ~noments unril *_he end of the year, as with the pr~parations of the 1981 budget." The following 3ay, the president traveled to Yar~s for a private visit c~uring which he wa.s to be received at the Elysee by Giscard d'Estaing to whom he had sent a letter of thanks o~~z the occas~on of the first anriiversary of. the restoration of the republ~c. This visit took place at a ~ime when the Centr~l African chief of state, who had placed h.ts prime minister and vice president un.der surveillance, was rela~- tive:Ly isolated in his country. When he left the Eiyses, on 21 September, D~icko said that he was " by the campaign of denigration" of which his country is the subject and ~�e "publicity 2 ~ Fnn n~~Trrnr :rcr nnnv APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 r~cc vrr~~irw uac Vi~LI given to former Emperor Bokassa by French journalists." The Central African chief of state recalled that he had seized power to drive out Bokassa, "account taken of - the crimes he had committed." He added that he had told the French president of - the "distress" caused him by this press ca~paign and confirmed the fact that the _ in absentia trial of the former emperor would be held in November in Bangui. COP~RIGHT: Rene Moreux et Cie Paris, 1980 8143 _ CSO: 4400 ~ 3 - FOR OFFICIAL USE ONLY = APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007/02/48: CIA-RDP82-00850R000300054406-7 FOR OFFICIAL USE ODTLY CENTRAL AFRICAN REPUBLIC BRIEFS , RELIEF FOR BIRA(~-After having declared the city of Birao, prefecture of the Yakaga regior. (in the northern part of the country) a"disaster area," the Central African authorities took a series of ineasures to "rehabilitate this region where rampant famine has already caused the death of 100 persons." The principal taken measure was the dispatch of a military detachment. Food will be sent to the Birao region on an emergency basis by France, according to a communique published by the Elysee in Paris on 18 September ,ahich underscores the fact that tl~is aid is being provided at the request of the president of the French republic and to show "France's soli- darity with respect to this stricken region.�1 Questioned about the famine which was ravaging the Birao area, President Dacko in Paris on 21 September said that tiie situation would not be critical over the long term and that a plan for the develop- ment of the region was under study. [TextJ [Paris MARCHES TROPICAUX ET MEDITERRANEENS in French 26 Sep 80 p 2363] 8143 CSO: 4400 1 4 - FOR OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850ROOQ3QOQ5QOQ6-7 _ FOR OFi'ICIAL USE ONLY ` CHAD - FIGHTING IN CAPITAL INTE":SIFIES Paris MARCHES TROPICAUX ET MEDITERRANEENS in French 2o Sep $0 p 2363 - [Text] Very heavy fighting which produced several hundre~ wounded and many dead both on the side o: the combatants and the civilian population took place on 17 and 18 September in Ndjamena between the Popular A;ceied Forces (FAP) of Presi~ient Goukouni Weddeye and the Northern Armed Forces (FAN) of Aissene Habre. ` According to observers, this tighting reached a level of violence rarely equaled since the beginning of the battle of the ca~ital on 21 March 1980. At dawn on 17 Septenber, Goukouni Weddeye's FAP and the combatants o� the Common Action Front (FAC) of Ahmat Acyl, minister of foreign affairs, attacked the northern sector ef the city of Diguel. At the same time, the African city occupied by the FAN was - violently bombarded, particularly with Stalin mis~iles, according to th~e AFP. , The French surgical facility in which FAP and FAC combatants are treated received about 40 seriousl}~ wounded (an unprecedented figure) in the course of those 2 days. - The other Freach medical facility in Kousseri, in Cameroon, on the c,ti~er side oi the Chari River opposite Ndjamena where the FAN are received, treated a dozen wounded, including five combatants. ShQ].ls fired from the Chadian capital fell on the Kousseri hospital in Cameroon killing four persons and wout~ding eight others, Radio Yaounde announced on 22 _ Sc,tember, a3ding that this shelling had caused very serious material damage. ~ The Cameroonian government "sent forceful protests to the various parties fighting in the Chadian capital. and took steps to assure the security of the inhabitants of Kousseri." _ In a related development, it was learned that the ~hadian government has signed a US ~50 million contract for the purchase of military aircraft, tanks, trucks and British medicines with Flintbrange Ltd., a Britisn company which is a subsidiary of the Fanz Organization, a oroup founded and directed by the Nigerian chief, Francis Nzeribe. - COPYRIGHT: Rene Moreux et Cie., Paris, 1980 - 8143 CSO: 4G00 S FOR OFFICIAL i1SE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 FOR OFFICIAI, USE ~NLY . COt?GO CENTR:II. COMMITTEE LOOKS INTO IMPROVING ECONOMY, FINANCES Paris MARCHES TROPICAUX ET riEDITE1tRANEENS in French 12 Sep 80 p 2251 [Text] The fourth session of the Central Co~nittee of the PCT [Congolese Labor Party],the only Congol.e~g~party, which was held in Brazzaville from 9 to 14 August 1980, studied improvements in the economy and finances of the People's Republic of th e Congo . In the final cotamunique of the meeting, the Central Committee reported on the cur- renr. situation: - Improvement in the Management of Publ.ic Finances "'~Ihen it studied the implementation of the supplementar}� 1980 program, ri~e Central Committee noted some favorable factors. Indeed, the continued spirit c>f sacrifice by the workers and various ecoziomic agents who regularly and unselfishly contri.- buted to the nati.onal solidarity fund, plus improved tnanagement of publi.c: finances, increased resources and finally, the renewal of external credit by the sGate made regular payment of ~oages possible and gave the Ministry of Plans the nec~~ssary means to implement the development p rogram. "Tlius, as of 30 June 1980, the scate's overall resources amounted to 7t) ~~ercent - or the total estimate for the year. However, publ:ic firms must show g~-e~ ,ter dyna- mism in using programmed foreign credits, all kinds of. natiunal financiul credit and especially domestically ~enerated "Indeed, many offices do not know the necessary proced~res Ec>r. carryin~ ~ut a pro- ject successfsilly (study, work pla,nninp� choice of a foremari, submitting bids, etc.), that, plus details on management of funds, the conference on stat:f~ enter- prises, the limited scope and underequipped state oE :nany fic-ms responsivle for projecCS remind us that, as of 30 June 198U, the program had, in fact, only been in effect four months. Thus, Che rate of actual achievement is necessar:~_ly lielow that o� the financial investr.;~nt. "ThereforP, the Central Committee advised, ~~he~ever there wet-~~ no such procedures, sp~ci_fic program planning and systematic, rigorous supervision to adhere to the plans as much as possible. 6 APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 FOR OFFICIAL t1SE dNLY "The tes~ year will interest all closely or marg~na'.1y connected, no n~tter what the stage of implementation of the program, an;l es;,~cially officials and ;~olitical cadres, administrative and public sector cadre~:, z-~d privat~_ foreign or native _ entrepreneurs who have benefitted on occasion from st:te contracts. "Consequently, the Central Committee warns entreprene~rs who do not fulfill tlleir obligations that they will be systenatically frmm future bids or consul- tat ions . "In ;:.enclusion, the Central Committee felt that despite certain advantages and ri good start, the success of the 1980 program ~iill depend, above all, un increased, sustained productivity, professionalism and growing vigor in supervising tasks at all stages of their executi~n." Priority for Investment Expenses "The Political Bureau informed the Central Committee about the financiai outlouk _ f~r the 1981 program. This report revealed that, despite an appreciable increas~- in our resources, the state budget suffers from a structural. defect; the operat.~..c, expenses are much larger than investment expenditures which can only be financ~~ by the remainder of the resources, thus limiting the possibility of creating new j obs . "Taking into consideration the lessons of the recent experiment, the Central Com- mittee refused to sap our resources again in an unthinking increase of the wage mass at the expense of financing development; this is all the more true since its _ � priority is to hire all young cadres sent to it for training. "However, to assist the mass es in dealing with inflation and the ever-eroding buy- _ ing power of households, the Central Committee which is pleased at how enthusiasti- cally the people continue to heed the advice of Presi.dent Denis Sassou-Nguesso: 'Live austerely today to live better tomorrow' has unanimously agreed on the following govern~c:~cal guidelines: "1. Abolition of the national solidarity fund. "2. Restoration of promotions with pay increases. "3. Tax relief in the form of changes in tax rates on the income of individuals (IRPP). "4. Hiring young cadres for tra~ning. _ "These directives will become officia.l in the next Law on Finances and will go into effect on 1 January 1981. "Finally, the Central Co~ittee gave thePolitical Bureau the responsibility for doing an in-depth study on ways to overcome the current above-mentioned tendencies and how to: 7 FOR OFFICI~L USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007/02/48: CIA-RDP82-00850R000300054406-7 FOR OFFICIAL USE ONLY "1. give priority to investment expenses so they are no longer a res idu~ or re- maiacitr and, after that, :.'�ter~ine the amounC to be spent or. operating e~c~~enses; "2. implement a true development plan to create jobs outside the civil.:::~rvice. All t hese decisions and guidelines based on the data of the report of tt~~ Central Commission on Party Supervision and Verification allow the Central Committee to stres s again the importance and need for control by cadres of the structures of the party and state placed in their cha~ge, fvr a constant effort at disc ~pline - at all party levels and for better relations among the various bodies of ttie party and t he state." COPYRIGHT: Rene Moreux et Cie Paris, 1980 9479 CSO: 4400 ~ APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 FOR OFFICIAI. USE OPTLY C CO ECONOIdIC PROSPECTS ZI~ROVING BECAUSE OF CONTRIEUTIONS OF PETROLEUM - Paris hIARC~IES TROPICAUX ET MEDITERRANEENS in French 3 Oct 80 pp 2402-2403 - [TextJ On 3 October, the People's Rept~blic of the Congo celebrates the 100th anniversary of the founding of Brazza~~ille. The date chosen corresponds to the anniversary of the signing, in the village of r!fa at the mo~~th of the Mfoa, a _ waterway that flows through the Congolese capita.l, of a treaty betw:~en Brazza an~ the Makoko Ilo grantiag France ~ territory situated between the O~ooue, ~he Alir and the Congo. On this occasion, we thought iz woixld be fit*_ing to provide our readers with a picture of the Congolese economy, which ewphasizes both the difli- culties encountered by enterprises and the hope.~ placed in the o:.~ sector. Impact of Oil With production of crude rising fror~ 1.8 million tons in 1977 to 'L.4 million in ~ 1978 and 2.d million tons in 1979 (plus 1.5 billion cubic meters of ratural gas), oil is the essential element in the recovery of the Congole~a ec:onomy. The ~radual drilling of new wells on deposits discovered 'ooth offshore and on land points to crude oil production exceedin~ 3 million tons by 1980, nearly S million tons in 1981 and 8~illion before 1990. An investment program on the order of 100 billion CFA fran cs has been planned by ELF-Congo [Gasoline and Lubricants Company of France]. Both becauae of increased production and successive price increases, oil r.oyalties ~ have gone fram 15 b illion CFA francs in 1978 to 20 billion in 1979. Estimates for 1980 are put at 40 b illion, representing three-fifths of operatin~ budget receipts. A contract f or the rehabilitation and startup of the Pointe-Noire refinery was _ awarded in February to the engineering firm Technip. Tne refinery, which was to go into service in 1975 with a prucessing capacity of a million tons of crude oil ~ yearly, has never operated. Its cost represents 34 bi,ll.ion CFA francs, including 7 billion actually paid to the Belgian-Austrian consortium that built the unit. : The litigation was h eard before the Court of Arbitration of the International Chambf_r of Commerce in Paris, which ruled against ehe consortium in .lanuary. The search f or uran ium ore led to an agreement with AGIP Recherches C~ngo [Italian - Petr~leum F.nterprise Research oi the CongoJ for prospecting in the southwestern - region of the territory. 9 FOR OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007/02148: CIA-RDP82-44850R000300054406-7 FOR OFFICIAL USE ONLY Transportation In 1979, traffic at the public port of Pointe-Noire amounted to 3.4 million tons, up 21,6 percent over 1978. The port has enjoyed increased s;~ipments of manganese ore from th~ Ogooue Mining Company (COMILOG),which, mined at Moanua in Gab on, - is hauled by the Congo-Ocean Railroad and shipped out at Pointe-Noire. Some 2.3 u~illion tons were shipped in 1979 (up 36 percent over 1978). The improvement ir. oil production is reflected in. traffic at the Djeno terminal, whe re shipments totaled 2.7 million tons (up 13 percent). , River traffic continues to decline since 1977. In 1979, traffic going downstream totaled only 135,000 tons (down 8.6 percen*_), including 123,000 tons of lumber floated or taken by barge from the north. River equipment remains inadequate. The ten barges lost 197R have never been repla~ed. Besides the Gabonese manganese ore, goods hauled by the Congo-Ocean Railroad (CFCO) - totaled 1.1 million tons in 1979, down 5 percen~ from 1978. Industry: Some A~iaptation ~ In the private industrial sector, 1979 was far from good but does show some adapta- ~ tion regarding the many difficulties: the accumulation of holidays, absenteeism reaulting from trade union demonstrations or other unforeseen occurrences, breaks in the supply of water and electricity, particularly at Pointe-Noire, inadequate - telephone and telex connections, the absence of price index statistics, the lack of off icial in~~rmation, the suspension of publication of the JOURNAL OFFICIGL since 1974, increased labeling and in~pections by the administration, and the disorgan- _ ization of transportation, mainly the Congo-Ocean Railroad, which had 42 interrup- , tions in service (553 hours) in 1979. Enterprises whose production is subject to price fixing and controls have encoun- tered er.cessive ~elays in having price readjustments imposed by constantly increas- ~ ing prices for raw materials, energy, transport, services and social charges accepted. For export industries in LTDEAC [Customs and Economic Union of Central Africa] coun- tries, the burden of charges to the disadvantage of the Congo places them in an inf erior position compared with Cameroon in particular. Moreover, the increase in similar industries within UDEAC, contrary to the program initially agreed upon, limits markete for Congolese export industries to the damestic market alone, . _ Domestic demand i~ increasing very slowly and consequently, expansion of the indus- trial sector, the main supplier of _jobs, is clearly inadequate, - While breweries have registered in�reased sales, profits are low because of frozen prices and difficulties in having them raised, despite the higher cost of basic supplies. The new facilit~!es of the Kronenbourg Breweries went into service in April 1980. Investments represented 2.7 billion CFA francs for a capacity increa~ed to 200,000 hectoliters of beer and 100,000 hectoliters of soft drinks per yeax. The Brazzaville Brewery is using its full production capaeity and a 5-year expansion pro gram costing a billion CFA francs will increase its capacity to 360,OOU hecto- liters per year. 10 APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 FOR OFFICIAL USE ONLY Industrial deepsea fishing had a catch equivalent in tonnage to that of 1978, but = - sales prires have dropped by about 10 per^ent. Prospects ror 1980 are very un- favorable because of the higher cost of fuel and the impossibility of fishing � in the south (Congc River and Angola) for most boats, as in the pasL. ' In the northern region, lumbering improved. The high cost of the Congo-Ocean ~ Railroad caused an excessive accumulation of stock and tight finances for the main enterprise. Service of the CFCO improved clear?y beginning in November 1979. The Con~o Plywood Company (PLACONGO), 25 percent of which is owned by the Congolese _ Government, had to reduce its production af rough timber and production of plqwoo:;. Investments made since 1977 amount to 1.2 billion CFA fraacs. After the shutdown of the Congoles~ Textil� Company (S01EXC0) in 1977, tne textile branch has had only the Congo Printing (IMPRsCO) unit, in which the Congolese Government holds 30 percent of the shares. Production has 5teadily increased _ since 1975 and totaled i5.3 miilion meters of fabric in. 1979 (up 11.8 percent over - 1978), for a turnover of 4.8 billion CFA francs. Exports totaled 11.5 percent of the fabric printed (16.5 percent in 1978), inasmuch as local demand has been more sustained. _ T}le shoe sector is represented only b~ Bata-Congolaise, whose Pointe-Noire plant produces some 750,000 pairs a year, or half o~ the potential capacity. In 1979, the enterprise suffered from a prolonged strike, a drop in purchasing power of the ' population, interruptions in the supply of water and electricity and irregular _ ~ayments on the part of civil ~ervant customers~ With a production capacity of 60 million packages of cigarett~s a year, the Industrial and Agricultural Tropical Tobacco Company (SIAT) produced 31 milli~n _ packages of cigarettes in 1979 (36 million in 1978), for an untaxed turnover of 2 billion CFA francs. ~xports to Gabon, the Central African Republic and Chad have declined. ~ The Congo Glass Company (SOVERCO), built in 1968 by English firms but which had - - never gone into operation, was rehabilitated in May 1979 with ti-~e technical assis- tance of Production in 1979 was on the or,ier of 12 million bottles. - Estimates for 1980 total double that amount, with three-fifths exported to the Iyory Coast, Togo, Gabon and the Central African Republic. ALIICONGO, a subsidiary of ALUCAM [Cameroon Alumininum], produced articles worth . 768 million CFA francs (up 29.8 percent in 1~78). Exports to UDEAC countries and - outside UDEAC amounted to 17 percent. The enterprise suffered in 1979 from inter- ruptions in electricity, transport difficulties and a lack of railroad cars to Brazzaville, and increased unpaid 'viils of custamers. These same difficult~es affected the production of industrial gases: down 4.6 - percent for acetylene, although oxygen production roae 7.2 percent. The drop com- pared with 1976, a year of good industrial activity, amounts to 33.6 and 22 percent _ respectively. Paint production, which in 1978 dropped 35 percent in volume, was better. Predic- tions for 1980 are relatively favorable. 11 ~ FOR OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007/02148: CIA-RDP82-44850R000300054406-7 ~ FOR OFFICIAL USE ONLY Commerce _ On the whole, commerce, which has suffered the effects ~f the serious depression of the national economy for 3 years, did not show any recovery in 1979 for the same - reasans: declining purchasing power of the population, irregular payments by civii servanta and deteriorating credit because of the abaence of. any prosecu- = tion or punishment for the issuancP of checks with no funds. The distribution, entrusted t~ a stat~ organization with an import monopoly, and marketing of basic commodities and items werP particularl5 deficient and e~en totally paralyzed sometimes with respect to flour, sugar, cQment, oil, livestock feed, and so ~n. . - Beginning in the s~cond half of 1979, the situation of private com:nerce improved, a recovery that seems to have gained in strength since April 1980. Enterprises generally suffer from insufficient funds because of tax adjustments, social and ban'~ charges and unpaid debts. The automobile vehicle ffiarket was stagnant in 1979 compared with 1978 and down 24 percent compared with 1977. Tourist vehicles represented 53 percent of the - market; utilitarian v~hicles 47 percent. Japanese brands continued to make progress and in 1979, accounted for 46 percent of the Congolese market. Dealers complain - of thefts and looting during transport. The replacement of accessories increases ~ the cost price of the vehicle and delays delivery. An important contract for the suppl;~ing of 208 buses, costing 3.5 billion CFA francs, was obtained by the Spanish firm Pegaso. Ttie equipment will go to Brazzaville, Pointe-Noire and Loubomo. The first deliveries are to be made in October 1980 for the celebration of Brazzaville's centennial. - Building and Public Works: Recovery The building-public works sector has enjoyed a substantial recovery beginning in the second half of 1979, p3rticularly in Pointe-Noire, which has received the - benefits of oil investments. Nevertheless, activity is hindered by the scarcity of cement. It would appear that tha construction market in the Congo is too small for major enterprises. Since the dissolution of the Congolese Housing Office, which financed, built and managed social housing, the sector has been in the hands of four government organ- izatio:~s: the National Construction Company (SONA:.O), which has had Cuban aid since 1979; the Property Promotion and Management Company (SOPROGI); the Center for Housing Re~earch and Technical Studies (CRETH) and the Construction, City Planning and Housing Directorate. The first program deals with the construction of 300 housing units, 12 of which were delivered at the end of December 1979. State Enterprises According to the view of high-ranking officials, difficulties in the state indus- trial sector result from poor management, the inertia of the tutelage structures, the lack of discipline, disorder, a lack of unawareness, casual attitudes and deviations in the action of political and trade union organizations. 12 r.nn nr,r.Tnrer rr~n n*rrv APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007/02148: CIA-RDP82-44850R000300054406-7 FOR OFFICIAL USE ONLY Although exact information is not available, the debt of state enterprises is cially put at over 88 billion CFA francs, not ir.cluding guarantees supplied by the _ government on the order ot 79 billion CFA franc~. From 1976 to 1979, direct bt~dge- tary balancing subsidies exceeded 8 billion CFA francs and treasury aid amounting to 6 billion CFA francs was awarded en a foreign loan. On 1 January 1980. the National Aviculture Company (SONAVI) was set up in Loubomo, ' bringing together all state poultiry fai~ns, most of which have ceased operating for several years. The new company receives Cuban assistance and predicts a turnover (eggs, chickens and baby chicks) amounting to 200 t~~~l~ion CFA francs by 1980, which figure would increase to 478 million by 1981 and 745 ~~illion in 1982. The Dihesse Ranch Office in Loudima, set up in ]974 with financi:~g from tha World Bank, contirues its development: 10,000 head of livestock are expected by the end of 1980. The second phase of the projeet (35,000 head in 1983) will be modified into small livestock raising operations in rural areas. A project to rehabilitate the industrial manioc processing camplex is underway with the repair of the xoot line (5,000 tons per year) and the setting up of a bread flour line. In 1979, banking activity had two very distinct periods: The first 6 months w^re affected by the slowdown of the economy and the second half of the year was marked , by the economy's beginning recovery. Oil taxes provided the budget with a steady supply of funds and resulted in the recovery of pub~ic finances. Government officials were once again regularly paid. Support for public enterprises.and the large number of employ~es in public ar.d para- public service pluced a burdEn on previous budgets. In his message at the end of the year, the chief of state said that the foreign and domestic debt had become overwhelming: It is estimated at 250 billion CFA francs. Measures have been taken and agreements have been made with foreign lenders, particularly the IMF. The program to get production off to a new start, the reorganization and rehabili- tation of state enterprises and the completion of eqaipment projects halted in midstream should enable the Congo to resume its development in a healthier financial situation, thanks to oil royalties. COPYRIGHT: Rene Moreux et Cie Paris 1980 11,464 CSO: 4400 - 13 FOR OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000300050006-7 FOR OFFICIAL USE ONLY - CONGO BRIEFS CONFERENCE ON STATE ENTERPRISES--On 21 September, in Brazzaville, Col Sassou-Nguessc~ - presided at the ceremony reopening the Congo state enterprises' conference which _ started last January. In a brief speech, the chief of state said that it was neces- sary "to more clearly define the problems of the enterprises" and emphasized the need for being more precise during this conference resumption pEriod. He added that the question was one of "finding remedies for the uiling enterprises." Col - Sassou-Nguesso also said that it was necessary to take steps to permit the recovery of the enterprises and that "every error in this second phase will have incalculable cons~quences for the future of the Congo." The work of this second phase of the conference is being chaired by the prime minister, Col Louis Sylvain Goma, who is also president of the permanent committee of the state enterprises' conference. _ [Text] [Paris MARCHES TROPICAUX ET MEDITERRANEENS in French 26 Sep 80 p 2364) 8143 - EDF FINANCING OF CFCO--The cammittee of the ~uropean Development Fund (EDF) has given a favorable opinion on a grant of 4 million units of account and a special loan of 2.86 million European currency units for the supplementary financing of the realinement of ttie Congo-Ocean Railroad. [Text] (Paris MARCHES TROPICAUX ET MEDIiERRANEENS in French 26 Sep 80 p 2364J 8143 C50: 4400 ?4 FOF. OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000300050006-7 FOR OFFICIAL USE ONLY - � ~ - DJIBOUTI DATA ON PORT OF DJIBOUTI - Paris MARCHES TROPICAUX ET MEDITERRANEENS in French 1~ Sep 80 p 2307 r [Text] On 16 August 1980, the Council of Ministers ~f t:1e Republic of Djibouti approved the creation of, and the statutes for an autonomous international port at Djibouti, effective 1 January 1981. To ur,derstand the scope of this measure, we are pub lishing below a br~~f list of Djibouti port activities for t`~. last two years: 1978 1979 Ships docked (number) 1,267 1,182 Net tonnage (1,000 tons) 5,826 7,728 - Passen~ers embarked 1,000 871 Passengers debarked~ 1,283 1,152 Total hydrocarbons loaded (1,000 tons) 302 343 Total hydrocarbons unloaded (1,000 tons) 42/ 508 Total hydrocarbons re-exported (1,000 tons) 38 17 4 Merchandise loaded (1,000 tons) 125 120 Merchandise unloaded (1,000 tons) 270 250 ' Transshipped merchandise (1.,000 tons) 55 16 ~ " t-F~r. supplied to ships (1,000 tons) 147 117 ` i� 1979, the port's profits were only 36.1 billion DE [Djibouti francs] while in 1978, they amounted to 157.3 million (1 DF equals 0.025 French francs). Receipts which amounted to 902.9 million in 1978 dropped to 860.3 million in 1979. Yet, from 1978 to 1979, costs rose from 745.6 million to 8Z4.2 million although capital outlays drepped from 86.4 million to 65.9 million. A study of port improvements was completed in 1980 by BCEOM [Central Study Office for Overseas Equipment]; it was financed by the EDF [European Development Fund] at a cost of 65 million DF �or the master plan and by the FAC [Aid and Cooperation FuudJ at a cost of 15 million DF for a container terminal. Construction work on the latter has not yet begun. The cost is estimated at 2 billion DF, of which 500 million coill be financed by the Federal Republic of Germany (for the purchase of Krupp cranes); financing by Kuwait is under consideration. Saudi Arabia is expected to provide 318 million DF for the construction of a 15,000 cubic meter refrigerator warehouse. COPY KIGHT: Rene Moreux et Cie., Paris, 1980 9479 CSO: 4400 15 _ FOR OFFICIAL USE ONLY ` APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000300050006-7 I FOR OFFICIAL USE 0\~:.X - LIBCRIA BRIEFS PROFERTY EXPRGPRIATIO~i MEASURES--The r ~ple's Council for the Redemption of Liberia - announced on 24 September tne expropriation of property of about 20 officials of = the old regime who had fled abroad and not answered the ultimatum to return to Liberia by 16 September (see MARCHES TROPICAUX ET MEDITERRANEENS 19 Sep 80 p 2298). Only one person is said to have replied. Among ihe people affected by the measure are: the former vice-president, Bennie D. iUarner; the general se~retar.y of the True Whig Party, which ~as then in power, Mr C"tarence L Simpson; and four former ministers. [Text] [Paris yIARCHES TROPICAUX ET ?~IEDITERRANEENS in French 3 Oct 8~? p 2423] 8782 GOOD RELATIONS WITH FRANCE P.~STORED--The charge d'affaixes of the Liberian embassy in Paris proposed on 18 September the establishment of a Franco-Liberian investors' - association. Tfiis initiative confirms Liberia's desire to keep good relations with France, as expressed on 21 3une by the foreign affairs minister, Mr Gabriel Bacchus _ Matthews (see MARCHES TROPICAUX ET MEDITERRAIv'EENS 27 Jun 80 p 1629). Also noted was the declaration made by the charge d'affaires a few days before the private visit to Paris of the minister of Planning and Economic Affairs, Dr Togba Nah Tipoteh. It may be recalled that Franco-Liberian relations became s~rained following the kidnap- ping from the French embassy in Monrovia of the eldest son of former President Tolbert, - Mr Adolphu~ Benedict Tolbert, who had taken refuge there after the coup d'etat of _ 12 ~pril. (see MARCHES TROPICAUY ET MEDITERREWEENS 20 Jun 80 p 1568). The Liberian government then asked that the French ambassador, Mr pollot, be recalled to Paris, u,.~ itrescindeiiits request. Mr pollot was nonetheless recalled for consultations b t}ie Prench government and returned to Monrovia only on 15 September, [Text] [Paris h1ARCHES TROPICAUX ET MEDITERRANEENS in French 3 Oct 80 p 2423] 8782 - GOOD RELATIONS WITH EEC RESTORED--Before coming to Paris, as mentioned above, to - negotiate essentially for financial aid for the ex-3nsion and remodeling of the free port of Nlonrovia, the Liberian minister o� Planning and Economic Affzirs went to Brussels on 18 September to restore his country's relations with the EEC; these relations had also been strained by the kidnapping of former President Tolbert's son from the French embassy in Monr.ovia. European aid to Liberia this year is supposed _ to come to about $500 million. [Text] [Paris MARCHES TROPICAUX ET MEDITERRANEENS in French 3 Oct 80 p 2423] 8782 CSO: 4400 16 FOR OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000300050006-7 FOR OFFICIAL USE ONLY MOZAMBIQUE STATE OF ECONOMY, NEED FOR WESTERN EXPERTISE SURVEYED Paris MARCHES TROPICAUX ET MEDITERRANEENS in French 26 Sep 80 pp 2341-2343 [Article by Jacques Latremoli.ere; "Mozambique Explains Its Call for Western Financial Aid"] [Text] We have already'mentioned the change imposed on Mozambique, which is a former popL~.lation-settlement colony whose economy was based on encouraging immigration until the colony became independent. Now the immigrants have gone back to Europe (see MARCHES TROPICAUX ET MEDITERRANEENS 22 Feb 80 p 417). However, a technocracy does remain (it has 7 representatives in the present government); it is of. Portuguese, Goan, or Luso-African origin. It is quite - competent, but it is also extreme~y sensitive because of its uncomfortable - position. It has few intermediary structures and feels that it burned its bridges behind it when it chose to remain. This has naturally led the "intelligentaia" to N~arxist solutions, and they have t~een helped along by many frier.dly cooperating countries of the Eastern bloc. However, frequent recourse to Western capital shows that the situation is changing. 1~is can be explained first of all i:~y psychological factors. The closeness of ~elations with South Africa, the country's primary supplier, obviously makes it easy for the leaders to reconcile Marxist-Leninist theory with day-to-day reality, i.e. the pursuit of a permanent dialogue with a neighboring country that is diametrically opposed in ideology to Mozambique. That is why Mozambican officials complain that Westerners are not firm enough with Pretoria when the Mozambicans are not very firm themselves. The reason is, they say, that "they are in a poor position to do otherwise and can assert themselves only in the United Nations or the OAU." But there is another cause: the inevitable rise of purely African elites, who do no~ have the same reasons for appearing simon-pure in terms of dogma and who are quite willing to adopt empirical solutions in the increasingly numerous positions they occupy. The result is a gradual slide toward a form of national socialism adapted to local needs. This is illustrated by the elimination from the government last April of radical elements like Marcelino dos Santos, a former Planning minister who had been demoted to secretary for Economic Production, or by the assurance offered by President Samora Machel to the representatives of tne Business International Corporation, an American company, that "Mozambique, as a sociali~9t . 17 FOR OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000300050006-7 ~ FOR OFFICIAL i1SE ONLY count.ry, i.s well~organized enough to ~tork with pxivate enterprise, multi- _ national or :~ot, hy preserving the principle of mutual advanta~e." But no one should jump to conclusions about mere tendencies, he the~~rtarxist orthodoxy or people, for fear of provoking hostile reactions from the leader- ship, whatever its background. But psychological factors are not the only ones at work, and the weight of events is actually more important. It works in several ways. Tfie return of peace to ZimbaUwe spares the Maputo _ authorities the periodic destruction inflicted on the country by Rhodesiaa air and comraando raids, and it spares them fiaving to support about 200,OOQ refugees living on their soil, although it is true that they were receiving appreciable international aid for this purpose. Hence there has been a rela- tive slackening of financial tensions. Normal railway links have been rees- tablished between Mozambique, Swaziland, South Africa, Zimbabwe, ar.d Malawir with the accompanying large amounts of revenue, and new prospects have been opened up for markets and supplyir.g Zambia and even Zaire. Finally, concerning agricultural and industrial production, the authorities realize that corporate profitability is tied to managerial competence, and the departure of skilled employees is sorely felt. Continual resupply of raw materials and spare parts is expensive, detailed, and hard to organize; the government bureaucracy is incapable of doing the job. Hence foreign technicians have been brought in, and their effectiveness is conditioned by transportation facilities and autonomy in the use of the credits at their disposal, particularly concerning orders for foreign materials and their - shipping into the country; this makes procedures more flexible and gradually wears off on methods of management in other sectors, Railways The Mozambican authorit~es are fully aware that a situation exists making it possible to increase riational revenues; it must be taken advantage of quickly, before the reestablishment of normal rail traffic to Benguela and Dar-es-Salaam from Lubumbashi and Lusaka takes away the production of the Zambian and Katanga~l ~ Copperbelt permanently from the ports of Nacala and Beira, which should pro- vide the most economical sea outlet, in any case. The TAZARA (Tanzania-Zambia Railway) had only one political objective: freeing Zambia from fiaving its production controlled by the "colonialist" nations of Rhodesia, Portugal, and South Africa. As this objective no longer has any - purpose, there can be no assurance that China will continue to lavish money and technicians on a railway that has already cost it a pretty penny. Like- wise, the endless Angolan rail line from Benguela, which was made useless by UNITA commandos, made up for the break between the Zambian and Mozambican lines in Malawi. Continued fighting in southern Angola and the very nature of the Luanda regime make the Atlantic rail line much less attractive to Zaire. The possibility of Zaire's channeling part of its foreign trade tli'roug}1 Mozam- bican ports was, as a result, one of the themes of talks between Presidents Mobutu Sese Seko and Samora Machel in Maputo last 7-9 June. 18 FOR OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000300050006-7 FOR OFFICIAL U5E ONLY It can th~is be seen th at not only temporary advant3ges are involved, which are already not entirely devoid of interest, but that wise decisions might - definitely channel to I~lozambique trade that fias so far � gone elsewhere, Coyzcerning Zimbabwe, it is only a matter of ~eopening the shartest access routes to the sea and freeing its trade from the transit fees charged by South African railroads during the interruption in rail traffic between Maputo and Salisbury, thus bringing this money into Mozambican coffers. The ports and railways will have to be reconditioned to accomplish all that. Before WW II, Portugal equipped the country witr~ a remarkable transportation infrastructure, but problems of settlement cau_~ed maintenance and moderniza- tion to be neglected s ince then, except on tfi e two lines directly lin~Cing Maputo with Swaziland and Pretoria, and there the lines were always m~intained by the South African republic. 'I'he equipment at the port of Maputo and its - ~ Matola mining annex used to take 12 million metric tons in traffic before the hostilities with Rhodesia, but they now take only 9 million tons; however, they could achieve 18 million tons once tha railway is back in service along the Limpopo valley to the border. The port of Beira provides a direct rail link to Salisbury by way of Umtali; it could operate normally bEginning in 1981, once tile necessary repairs are made on the Zimbabwe side. The rail line's capacity is commensurate with that of the port. Dredging operations ha~~e been contracted to a British company and should open its channel to . high-tonnage shipping and supertankers, thus permitting 10 million tons of traffic compared to the present 1.6 million tons. In the north, finally, Nacala is one of the best port sites on the east coast - of Africa; in light of wrat has already been mentioned, it could become the normal gateway to Zambia and southern Zaire by way of the spur into Malawi and its possible extension into Zambia by way of Lilongwe. _ The roadbeds, rails, ballast, signaling, and rolling stock must all be _ replaced or renovated on the three main lines and their branches. Plans _ drawn up for this need a lot of money to be carried out. Mozambique seems to be seeking this money more in the West than in the Eastern countries, whose previous loans, especially for the central network, were disappointing. Local sources have been drawn upon in building a boxcar works with technical aid from a Portuguese company; appeals have been made to Romania, which is to deliver a first shipment of 10 diesel locomotives by the end of the year, with 22 more to follow. Brazil has sigred a$20 million contract for the sale of 21 General Electric locomotives partially financed by the United States. And France has been felt out about renovating the Malawi spur on the northern line in the context of a general project estimated to cost Fr 620 million, about a third of which would come from France. - In order to start work on these projects, it was necessary to coordinate inter- - national transportation closely; Mozambique was put in charge of this coordi- nation at the conference held in Maputo in the first half of July after the economic summit conferences of Lubumbashi and Lusaka. A commission headed 19 FOR OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 FOR OFFICIAL USE ONLY by the Mozambicat~ representative and including the eight other cc~untries participating in the conference (Angola, Botswana, Lesotho, Mala~,~i, Swazi- land, Tanzania, Zambia, and Zimbabwe) will maintain the continuity of options and the works progress schedule, but it will not exclude contacts between Mozambican technicians and those of each of the countries involved. T'he _ task of management that has been assigned to bfozambique is very important for the continuity of work in other countries, though hiozambique may have only terminus sections of the projects on its own territory. The Ups and Downs of Industrial and Agricultural Production R`hile the present situation requires that a financial and t echnical efiort benade quickly to solve the problem of international railway links, agri- culcural and industrial production also needs foreign aid, tor several reasons: local resources are inadequate to the amour.t of finnncing neces- sary, and problems have appeared in the management of hastily nationalized companies, whose purposes do not always correspond to the needs of "decolo- nialized" Mozambique; not to mention that these companies are hampered by a lack of qualified personnel. The desire to diversify the sources of aid and the government's refusal to apply to the i9orld Bank or to adhere to the Lome Convention oblige Mozambique to seek aid through bilateral agreements. It would take a long time to list the breakdowns in supplies and the tech- nical accidents causing production stoppages, tllough it would not be hard to do so, because they are reported in the press and on the radio. The _ more or less valid excuses given for nationalizing without compensation the few,already languishing Portuguese businesses sui�viving in the food or fisheries sector are not designed to improve the quality of the tool thus falling into the national domain. The country's main ~lastics factory has been paralyzed since January for the lack of raw materials. There has - been more than a year's delay in putting into service the Fabrica de Re�eicoes, a Beira beverage company. The biggest paint factory, whose 1978 production was already below that of 1975, has been out of production for three months. In the distribution sector, slipshod management and corruption caused the head of state to order that the "people's stores," the "lojas do po�ro," be ~ closed. It is significant that at the same time, Nurway was asked to finance, buil.d, and staff a sawmill; Hungary, a bus assembly line; Italy~s SNAM Progetti [National Gas Pipeline Company], a textile mill; Sweden (..ineflyg), tn maintain domestic airlines; and the USSR or France, to deliver boats. Appeals for foreign aid in sectors where factories and repair shops used to abound would be surprising except that in this country where illiteracy reigns, specialized wc.rkmen were provided almos~c entirely by the Po rtuguese. These appeals are more easily explained by the size of the bill for the railway or industrial projects, such as the north extension of the Cabora Bassa dam, which involves installing new turbines rated at 1,800 megawatts at a cost of $1 billion. The fall in agricultural production has also led the authorities to turn to foreign countries. This decline is not peculiar to Mozambique, for with the rare exception of countries such as the Ivory Coast or Cameroon, it is common ~ ~ 20 FOR OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 FOR OFFICIAL USE ONLY to tropical Africa, The iiigh percentage o~ the populati.on (90 percent) that lives off of agriculture and low industrial wages combine to keep food pro- duction dowr. WFiile food imports fiave grown from 0,2 percent to 6 percent since independence (the government has announced a 250,000-ton deficit in corn for 1980, not to mention wheat and rice, which gifts and sales from the Ur~ited States, Sweden, Canada, and France and international organizations make it possible to fill), the real reason is a farmers' holdback linked with the disappearance of markets in the countryside and with tfi e corres~ ponding difficulties of supplying the large urban centers of Maputo (800,000 people) or Beira (250,000 people). This decline has been felt especially in agricultural export production; Portuguese activity was especially important in this area, from agronomic research to marketin~, including tfie organization, staffing, and supervision of farming in areas comprising nearly fialf of the country's arable land. The cashew nut harvest fell from 215,000 tons in 1973 to 75,000 tons in 1978; it is the country's prinary export and has fallen again in 1980. Production is down especially in Sofala province, the main area of production, because of harvesting troubles, in both manpower and trucking. In the area of cotton, which is a priority area because it supplies the spinning and weaving mills, production seems to have dropped by 2/3 since 1973, despite official harvests _ of 1.5 tons per hectare on state farms or 800 kg per hectare in the coopera- tive sector. Actually, the general average of the harvests does not seem to exceed 250-300 kgJha in zones of suitable rainfall (600-800 mm) on water- retentive land, which could bring harvests up to 2 tons per hectare if well worked and treated. The government has proceeded to make a geographical division of cotton-farming aid. Romania has been assigned the province of Cabo Delgado, in the north, and the Russians, Nampula province, next to Malawi, while the CFDT [French Company for Textile Fiber Development] has been requested to work in Sofala and around Caia, on the south bank of the Zambezi river. The results achieved in Cabo Delgado in 1980 show average yields of 300 kg/ha. The Russians claim yields of 2,4 tons/hectare on experimental fields, but the actual average in their zone does not exceed S00 kilos; the plants suffered from fungus blight and their average density per hectare had to be lowered. The French should have good cfiances in this peaceful competition to the extent that they have, however, enough autonomy not only to provide their choice of tools, fertili- zer, herbicides, and insecticides, but also to staff the farms effectively. The structures consist of government corporations where the salaried workers may eventually become part owners; as they are required by the government, the French technicians will have to get along with them. France and Mozambique Mozambique has sound reasons to turn to the West, and the question arises, obviously, whether the corollary is true, Zimbabwe, Zambia, Zaire, and Malawi are free-economy countries. N'ill the West's aid cause them to associate more closely with Maputo, especially in transportation? As it is, socialist Mozam- bique has already shown itself to be pragmatic, and in Africa, political insig- nia almost always indicate mixed structures in which the government's omnipo- tence is tempered in direct proportion to development. In any case, Mozambique, 21 FOR OFFICIAL USE ONLY APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000300050006-7 FOR OFFICIAL U5E ONLY like Tanzania and Madagascar, appeaxs to be an indispensable partr~er to France's peacemaking policy in this corner of the Indian ocean, Mozambique's transportation and electrical infrastructtire projects hold great interest for the foreign trade of European countries and for France in particular because of the implied opportunity to supply services and materials. Of course, this interest depends on Maputo's financial credi- bility. This credibility is ~ometimes questionable: the 1979 budget deficit was 20 billion meticais, and the annual debt service is 1.5 billion meticais, which represents 35 peresnt of export receipts (5.3 billion meti- cais against 17.2 billion in exports, for a coverage rate of 1/3). (The "metical" (plural: "meticais") replaced the Mozambican escudo on 1 June 1980. Its value is Fr 0.135.) FV;~ile the crisis is causing more red ink to flow, it must be admitted that the easing of expenditures and increase in rail- way aiid port usage fees, not to mention the outlook for industry and trade, does encourage some optimism. Tfi is optimism is e:cpressed in the annual increase in t}?e volume of foreign financial aid to A4ozambiQue (~330 million in 19 7~, $45 million of which was from South Africa, and nearly twice as much in 1980). This is the contaxt in which French aid to Maputo should be eva:uated. Mr Guiringaud outlined its beginnings in 1977. They ti~~ere sealed on 18 March ~ 1980 on the occasion of Ntr Sergio Vieira's visi.t to Paris. He is a nover- - nor of the Bank of Mozambique and a member of the Council of Ministers. _ This aid was confirmed and extended during Mr Joaquim Chissano's recent visit to France; Mr Chissano is the Foreigr~ Affairs minister. Some French companies did not wait for officialdom to open the way: the UTA [Air Trans- portation Union] started a weekly Paris-Maputo flight via Kinshasa ttli.s year; the Salins du Mi~i are giving technical aid to the big Nicala salt works; the BRGM (Bureau of Geological and Mineral Research) and the General Geophysi.cs Company are prospecting for minerals and oil in Niassa, Cabo Delgado, and on the north coas't; and, finally, the CFDT [French Company for the Development of Textile Fibers], which is also working in the field, is furnishing an advisor to the National Cotton Institute. _ The agreement of 18 March signed with the French government sets financing terms at Fr 117 million for 15 shrimp boats with spare parts and crew training - provided by a shipyards group from the West. A 10-year export credit of Fr 200 million has been set up to build a high-tension line between Cabora Bassa and Mocuba. The loans will be granted by a Franco-ILalian consortium in which CGE-Alsthom will supply electric cables and materials up to the aforementioned credit limit, plus a 2-year, Fr 100-million line of credit for the purchase of light equipment and spare parts. A food aid grant of. 2,000 tons of grain has also been decided upon, but delivery has been delayed by a serio~s accident that happened off of Djibouti to the cargo ship that was carrying it, This first series of projects is being accompanied hy two others that are - being actively pursued: a Fr 50-million line of credit is being opened for - the purchase of foodstuffs and reconstruction, and anoth er one, for Fr 30 million, is being established for the Mavuzi