SOUTH AFRICA AND ITS REGIONAL POLICIES THROUGH THE 1980S

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP87T00126R001101640002-5
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 32
• Document Creation Date: December 21, 2016
• Document Release Date: December 11, 2008
• Sequence Number: 2
• Publication Date: November 1, 1984
• Content Type: NIE

Central
Intelligence
South Africa and Its
Regional Policies
Through the 1980s
NIE 73-84
November 1984
copy 340
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SOUTH AFRICA AND ITS
REGIONAL POLICIES
THROUGH THE 1980s
Information available as of 21 Novemlxr
1984 was used in the preparation of this
Estimate, which was approved by the
National Foreign Intelligence Board on
that date.
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THIS ESTIMATE IS ISSUED BY THE DIRECTOR OF CENTRAL
INTELLIGENCE.
THE NATIONAL FOREIGN INTELLIGENCE BOARD CONCURS.
The following intelligence organizations participated in the preparation of the
Estimate:
The Central Intelligence Agency, the Defense Intelligence Agency, the National Security
Agency, and the intelligence organization of the Department of State.
Also Participating:
The Assistant Chief of Staff for Intelligence, Department of the Army
The Director of Naval Intelligence, Department of the Navy
The Assistant Chief of Staff, Intelligence, Department of the Air Force
The Director of Intelligence, Headquarters, Marine Corps
The Department of Commerce
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Page
SCOPE NOTE ...................................................................................... v
KEY JUDGMENTS .............................................................................. 1
DISCUSSION ........................................................................................ 5
The Setting ........................................................................................ 5
South Africa's Perceptions and Goals .............................................. 7
The Regional Military Situation ...................................................... 9
The South African Defense Force (SADF) ................................. 9
Military Capabilities of the Neighboring States ......................... 11
Regional Economic Considerations ................................................. 12
South Africa's Internal Economic Situation ........... .................... 12
South Africa's Economic Options ............................................ 13
Prospects for Economic Growth in the 1980s ......................... 13
The Regional Economic Situation ............................................... 13
Prospects for the Regional Economies ................. ....... ............... 16
South African Internal Politics .........................................._............. 17
Outlook and Implications ................................................................. 21
Outlook .................................................... _.................................... 21
Implications ................................................................................... 22
For Black Africa ....................................................................... 22
For the Soviets .......................................................................... 23
For the United States ................................................................ 23
For the West .................._......................................................... 23
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This Estimate assesses the major changes in South Africa and the
southern African region in recent years, such as:
-The growth of South Africa's military and economic strength.
-The corresponding political, economic, and military weaknesses
of the black neighboring states.
-The determination of South Africa to project its power regional-
ly. using military and economic threats and incentives, to
deprive South African insurgents of bases and safehavens in the
neighboring states.
-The negotiation of a series of arrangements between Pretoria
and individual black African regimes to solidify South African
regional hegemony.
-The new constitutional changes in South Africa that bring
Coloreds and Indians into limited partnership with whites.
The paper also addresses factors that may inhibit South Africa's
power projections, including:
-Political divisions within the Afrikaner community.
-Continued racial discrimination and sporadic violence in South
Africa.
-An international embargo of arms to South Africa and its effect
on the military.
-The long-term decline of gold production in the Republic.
-The continued provision of Soviet weapons and advisers to
.-Angola and, to a lesser extent, Mozambique.
-The presence of Cuban combat forces in Angola.
The purpose of this paper is to assess the nature of South Africa's
regional accommodations and their durability for the remainder of the
19SOs. The Estimate also addresses in general terms the likely implica-
tions of these developments for the United States, Western Europe, the
Soviet Union and its allies, and the rest of black Africa. Although the pa-
per discusses the probable South African relationship with an independ-
ent Namibia, it does not examine the processes by which Namibia may
reach independence, nor does it deal with the intricacies of a Cuban
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 withdrawal from Angola or the disengagement of South African forces
from Angola.
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Since the collapse of Portugal's colonial empire in southern Africa
in the mid-1970s-and the resultant projection of Soviet and Cuban
power into the region-South Africa has attempted to shape the
regional political environment to meet its own security needs. Pretoria
has already compelled some of its black-ruled neighbors to accept
bilateral security agreements through which it is attempting to impose a
"Pax Pretoriana" throughout southern Africa.' Although there may be
periods of tension between South Africa and its neighbors, we do riot en-
visage a scenario developing during the rest of the 1980s in which South
African hegemony declines to the point that neighboring countries
would feel less threatened by South Africa.
South Africa is the dominant military power in southern Africa. Its
forces are not only larger and more efficient than those of any of the
neighboring black states, but are also highly motivated, well disciplined,
and thoroughly- trained. Because of the international arms embargo
against South Africa, Pretoria has fostered an extensive indigenous arms
production capability and has procured some foreign equipment and
technology by both open and clandestine means. Although South Africa
lacks the capability to produce high-performance aircraft and helicop-
ters, it will preserve its regional military dominance through the period
of this Estimate.
The armed forces of the neighboring black states suffer from poor
training, low pay, inadequate housing, a lack of technical skills, severe
maintenance and supply problems, and general demoralization. Con-
tinuing flows of Communist military equipment to the neighboring
states have not compensated for these inherent deficiencies of the black
armies, but they- are a source of concern to South Africa, even though
the military systems delivered so far are primarily defensive.
South African regional economic predominance is even more
striking. South Africa will experience only slow economic growth for the
rest of the 1980s as a result of the static production in its dominant gold
industry. But its economic power is so great in comparison with the fal-
tering economies of its neighbors that the migrant labor, trade, invest-
ment, and transportation dependence of the neighbors on South Africa
will prevail for many- years to come. Whether South Africa will be
The term "Pax Pretoriana` is used in this paper to mean the South African policy of forcing or persuading
neighboring governments, preferably through formal agreements, to cooperate with South African
authorities to eliminate the physical presence of suspected anti-South African terrorists on their territories.
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either willing or able to provide the considerable financial investments
that the neighboring states need is more doubtful. Pretoria is already
seeking Western commitments of aid to Mozambique and to an
independent Namibia, and will try to draw the West more deeply into
its regional schemes.
South Africa's pursuit of a Pax Pretoriana throughout the 1980s has
serious implications for African and non-African states. Although
Pretoria's black neighbors are too weak to challenge South African
hegemony, their weakness will not stop their support for Namibian
independence, political support for black liberation groups, and major-
ity rule in South Africa. Moreover, Pretoria's goal of a "constellation of
states" held together by security agreements and South African econom-
ic dominance runs counter to black southern Africa's own hopes of
distancing itself from Pretoria. Thus, the black-ruled states of southern
Africa will resist South Africa's efforts to dictate their domestic and
foreign policy priorities. As they come to realize that they cannot tend
off South Africa by themselves, they will seek, even more intensely than
they have in the past, the help of Communist and Western states to
bring pressure on Pretoria, although they will seek to keep Moscow at
arm's length while doing so.
At the moment, Moscow is especially apprehensive that South
Africa's recent security agreement with Mozambique and bilateral talks
with Angola could diminish the need of those states for Soviet military
assistance. Moreover, reverses for Moscow in these two countries
undermine Soviet efforts to support the South-West Africa People's
Organization (SWAPO) and the African National Congress (ANC).
Despite Moscow's concern, the Soviets are restrained by the very
weaknesses that beset their black African clients, and they lack the
leverage to push those clients beyond the political and military bounds
the clients have set for themselves.
While Moscow may have suffered some setbacks, there are no
indications that it believes the game has been lost. The Soviets believe
they can count on South African intransigence on Namibia's independ-
ence and on the growing effectiveness of the Angolan insurgents to
demonstrate the need for continued Soviet assistance in Angola. They
could also profit in the long run from the disenchantment of the region
with its subservience to South Africa. Moscow will also continue to
portray the West, particularly the United States, as collaborating with
South Africa.
The protracted diplomacy of the United States on southern African
issues over the last several years has great potential for advancing US in-
terests. On the other hand, there is a risk of reinforcing the widespread
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 perception among Africans that the United States is acquiescing in the
South African-imposed order. Also. as South Africa perceives itself
stronger, it will become less vulnerable to pressure. Thus. (S influence
in both the Republic of South Africa and black Africa nwy suffer.
Pretoria's aid for insurgencies it the region will fluctuate according
to overall South African military and political strategy. Until the South
Africans can be confident that a Pax Pretoriana has taken hold. they
will be reluctant to abandon the leverage that the insurgencies provide.
Pretoria hopes that continuing pressures will force the regimes in
:Angola and \lozaurbique to come to terms with their internal oppo-
nents.:Any resultant governments of national unity presumably would
reduce the Soviet and Cuban presence in both countries.
South Africa now admits that SWAPO cannot be excluded from
participating in an eventual independent government in Namibia.
Pretoria will nonetheless try to ensure that important posts go to non-
S\\ APO parties and that constitutional guarantees preclude a one-party
or Marxist state. Such arrangements would help to retain strong South
African influence in the country. As for the ANC, its military capabili-
ties will continue to diminish in the wake of the Nkomati Accord with
\lozauuhiquc. South African security forces will probably he able to
handle the military challenge from the AN(: without too much
difficulty for the rest of the 1980s.
But the ongoing violence ill South Africa. which increased sharply
in August 1984, demonstrates once again that the white regime still
laces serious internal security problems. South African security forces
are likely to become increasingly preoccupied with random urban
terrorism and spontaneous outbreaks of violence. although the govern-
ment is not likely to face a serious threat to its stability for the period of
this Intimate,
South Africa's efforts to impose a Pax Pretoriana stem in large part
from its desire to remove its perceived external threat in order to buy
time to work out its oven solutions to its domestic problems. President
Botha has restructured national political institutions and strengthened
the positions of the President and the few senior National Part
associates who share his commitment to limited constitutional and
economic reforms as well as to an aggressive foreign policy.
By this means Botha is creating the institutional framework for
making himself the most powerful leader in 20th-century South Africa.
For the next few years at least he will dominate the political scene.
Botha's only potential political threat lies to the right, but even that
threat is manageable, because the National Part base nos includes
more of the English-speaking electorate. Botha seems well placed to
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 enact his programs during the remainder of his scheduled term in
office, vwhich corresponds roughly with the period of this Estimate.
During the next five years. South Africa will institutionalize
limited constitutional reforms. co-opting as many Coloreds and Indians
as possible, and blacks residing in white areas, into a system that will
give them only limited political rights but will hold out hope of lunch
greater economic and social advantages.
As more blacks are assigned citizenship in the homelands. South
Africa's long-term political strategy will be to find a method to link the
homelands permanently to a white republic through some federal or
confederal arrangement-a domestic version of the concept of a
constellation of states. Botha would like to see such a system created be-
fore he leaves office.
Efforts to create that system will be hampered. however, by black
resistance, stemming from the governments inability or unwillingness
to meet black needs and aspirations. Government efforts to buy off
blacks swill be stalled by slow economic growth.
If black expectations are not met. blacks will turn increasingly to
violence. Black abilities to challenge government policies are limited,
but they do exist. Black dissatisfaction during the remainder of this
decade will not be sufficiently articulated. however, to bring about
major changes. But it may lead to enough unrest to force the govern-
ment into a steadily escalating use of force, which would add to its pari-
ah status in the international community and seriously complicate I. S
and Western efforts to bring about peaceful social change in South
Africa.
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 The Setting
I The southern African region is in a state of flux.'
A turbulent period that began in the mid-1970s with
the collapse of the Portuguese colonial empire is
evolving in new directions, currently highlighted by
Pretoria s efforts to erect a structure of bilateral
agreements between the region's dominant poster,
white-ruled South Africa, and its black-ruled neigh-
bors. Through these arrangements, South Africa hopes
to regulate the intricate strategic relationships of the
region
I. Many factors contributed to the turmoil that the
southern :African states have experienced during the
last several years- These factors include,
Mat vist regimes sw ith Soviet Bloc support came to
power in Angola and Mozambique in 1975 fol-
lowing Portugal's precipitate withdrawal from
:Africa In Angola, the liberation movements that
were excluded from power, particularly the Na-
tional Cnion for the Total Independence of
Angola t( MTV, mounted what has become a
serious insurgent challenge to the authority of the
nest Popular A tovernent for the I .iberation of
Angola IA1PLA) government.
l'be B6odesian civil war, growing in intensity
throughout the 1970s. finally- forced the white
regime to accept a negotiated end to the war and
the installation of a black majority government.
The restive black townships of South Africa
erupted violently in June 1976. In the subsequent
brutal crackdown by South African security
forces, many young blacks fled into exile in
neighboring countries where many were recruit-
ed into the principal South African liberation
movements. the African National Congress
:AA(:) and the Pan-Africanist Congress (PAC).
The AVC began to mount sporadic cross-border
Fort IT I' purnIles of this Estimate. southern Africa includes South
Si rirn_ Leuriho. Rotsscana, Sscazilaad. Zimbabwe. Atozambigue.
Vogola. Zambia. Aanribta, and Malawi. Zaire, particularly its
mineral-rich prm tnce of Shaba. is connected to the South Afriean-
domtnated regional rail ss stera and is, therefore, treated as part of
the oothe,, African economic scene Tanzania is not in the
sunticrti Africa region. but is involved in regional political affairs as
a I 'Qualm,' State
guerrilla operations into South Africa from bases
in neighboring countries
The United Nations imposed a mandatory anus
embargo against South Africa in late 19T. T., ton-
ing South Africa to accelerate its efforts to
become militarily and economically sell
-
su ffi cent
3. South African anxiety about these deselopnlents
was heightened by the eagerness of the Soviet union
and its allies to exploit them. By the time Pieter
Willem (P. W.) Botha became Prime Minister in 1975.
South Africa's increasing isolation seas apparent
Botha's government attempted to fomtulate domestic
policies to deal with the overriding question of race
relationships within the country. however, the govern-
ment appeared during its first years in office to he
devoting most of its time, resources, and energy to
meeting the "total onslaught" that it argued ssas lacing
South Africa on all borders-hostility from black
Africa carefully nurtured by the Soviet tpion and its
allies. As the 19,Os ended, South Africa watched with
concern the increasing sophistication of the Sosit t-
supplied weapon systems of its neighboring countries
and the growing military capabilities of the Soviet -
supported insurgent movements, particularly the
South-West Africa Peoples Organization tSW AP01
and the ANC.
d. Pretoria was also concerned by efforts of its black
neighbors to decrease their economic (dependence on
the Republic. The emergence of organizations such as
the Southern African Development and Coordination
Conference (SADC:C:)' dill not in Pretoria's view bode
well for the South African concept of regional eco-
nomic cooperation, which in the candy days of ill(
Botha era took form as a call for a ''constellation of
states" with South Africa as the nucleus au(I the lilac k
states as satellites.
5. In attempting to mold the southern :Alricon
political environment to its liking over the last several
years. Pretoria has used a variable mix of political,
economic, and military pressures. which has had some
success. Some black African states, even those that
' The members of x,000 are Angola, liotsuana, I....olhn
\talaswi. \Urzanabique, Swaziland. 'f:utzania- Z;unbia. aid
Zimbabwe
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F,onu~~o Srntm
? Nalirnai i~ tai
 h.nc n'ceived economic and military assistance from
either Fasters or AAeste'rn countries, have not been
c,Ipal,It of resisting South African pressure. While
South Africa has become stronger over the last decade,
its ucighhnrx (aye' heen unable to cope effectively with
their growing economic and security problems. Thus,
one by one, the states of southern :Africa have begun to
is to stork out an acconmiodation with South Africa.
South Africa's Perceptions and Goals
ti south -Afric;I sees itself as the dominant power in
southern Africa. whose needs most be taken into
account. and is an African state that has wrongly been
evcluded from continental affairs South Africa also
considers itself e gcostr tegic actor in southern Africa
with an important role to play in the East-West global
cnufroutalion South Africa is not interested in per-
suading others ill adopt its ideology or in acquiring
,edditional territory but it is determined to retain
economic and militars preeminence in southern
rice
South \frica s regional goals are in large part
deism in its domestic political situation- Its leaders
hale sought to cosine continuing Afrikaner domina-
tion_ despite x irtualb universal condemnation of its
political and social order In formulating its regional
policies. Pretoria is motivated In the need to buy tune
to put its domestic affairs in order and to blunt the
attacks of both its internal and external critics- To
holste while units. Pretoria takes a hard line against
the AA(. and those countries that, bV giving the ANC
aid and sanctuarA . (nave enabled it to engage in cross-
boideI' terrorism against South Africa. Pretoria also
smuts to ensure that all independent Namibia will be
goserned by a regime at least not overtly hostile to
South Africa. But Pretoria also wants to change the
nature of its relations with neighboring states, hoping
that in time these states will come to accept South
VIrica's right to manage its internal affairs.
S Inunediate Goals and Tactics. South Africa's
innneeliale goal is to reduce or eliminate the capability
of neighboring states to support antiregime movements
operating lit and out of South Africa and to force them
to cooperate' with South African authorities to elimi-
nate the physical presence of suspected terrorists on
their territories. The South Africans want these and
any future conunitr n'tnts codified in treaties, which
would also sere to give the appearance of closer
bilateral relations with South Africa. The model for
these' agreements seems to be the recently concluded
\knmati Accord with Mozambique. No change of
regime or immediate thawing of relations with the
Republic have so far been demanded of neighboring
governor en ts.
9- In connection with these nonaggression treaties.
South Africa will offer various inducements. tioulh
Africa has revealed the existence of a treat). similar to
the Nkomati accord, that was made two years ago with
Swaziland (under which Swaziland may ultim;tcls
receive some South African territory to which it has
longstanding tribal claini) Botswana and Lesotho are
resisting strong pressures to conclude similar accords
If these arrangements fall into place. Zimbabwe nlav
find itself under the gun to join the others. although
we doubt that President Mugabe would enter into a
formal agreement
10. The economic, political, and niilitar~ weakucsc-
es of the neighboring states provide South Africa with
easily exploitable opportunities to pursue its goals.
Economic difficulties have increased I innaticalb
over the past I0 to 13 scars through it combination of
factors.
Declining terms of trade for primary producers
Incompetent state intervention or inept social-
ist" policies, particularly in agriculture
Destruction. during civil wars. of transport and
other infrastructure.
Shortages of technical and managerial expertise.
Corruption in government burcaucracics
Natural disasters. including the drought now
entering its third year
The dependence of the other states of the region on
South African supply routes is also exploitable Fur
example, in 1981 Pretoria threatened to L'rorinac a
trade agreement with Zimbabwe that includes prefer-
ential customs duties and some quota gnurmtees ()It
Zimbabwe's exports to the Republic. and also threat-
ened to send home 41),000 Zinbabwe'an workers then
in South Africa- Pretoria than precipitated a transport
crisis b\ threatening to withdraw rolling stock oil loam
to the Zimbabwe' railroad, but backed off a result of
outside pressure.
I 1. The political turmoil in neighboring ,states has
also provided fertile ground for South African nrcd-
clling. For example, Zimbabwe has alleged that Pre-
toria has recruited and supplied some of tIn' dissidents
operating in the troubled Matabeleland Province that
abuts South Africa. While there is evidence of snow
South African involvement, the ethnic discord in
Zimbabwe and the interparty battle's that reflect it ire
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 a longstanding problem of indigenous origin. Zimba-
bwe's failure to resolve its internecine conflict swill
continue to provide the Republic with opportunities to
destabilize the Mugabe government if South Africa
deems such action necessary to fulfill its regional goals.
12. South Africa has been provided opportunities
for intervention by the military weakness of its neigh-
bors. Minimal amounts of aid to dissident groups can
create havoc for states such as Lesotho or Mozam-
biquc. lf6ese states are also open to direct attacks in
Pretoria's anti-AN(: campaign. illustrated dramatical-
ly in South African raids on Maseru in December 1982
and the bombing of ANC facilities in Maputo in May
1983.) Only Angola, with massive Soviet and Cuban
support, has made a major effort to defend its territory
against South African military incursions.
13- South Africa's neighbors are politically fragile.
Many political structures are overly dependent upon a
single leader and have yet to work out mechanisms for
the peaceful transfer of power. Many- of these leaders
have failed to develop effective security systems, and
because of their incompetence, particularly their in-
ability to develop adequate economic policies, now
face increasing disaffection.
14 South African policy tossard exploitation of its
neighbors' weaknesses is ambivalent. While Pretoria
holds it useful to keep these states off balance, too
much pressure could be coon terp rod uctive. South
Africa does not want to be surrounded by excessively
feeble states. Chaotic states cannot buy the Republics
goods and would offer little prospect for South African
investors. Such states cannot enforce the terms of the
nonaggression treaties South Africa is demanding and
would provide a favorable environnient for anti-South
African movements. We believe the Republic will.
therefore, keep the pressure on but will try to calibrate
it carefully: to the extent that these countries cooper-
ate with South African regional plans, they will gener-
ally be left alone to work out their internal political
arrangements.
15- The Long-Range Objective. The long-term
South African objective remains the formal establish-
ment of the constellation of states that Botha has
advocated since lie cane to power. The constellation is
intended to replace the "cordon sanitaire" of Europe-
an white-controlled territories (Angola, Mozambique,
and Rhodesia) that collapsed in the mid-1970s. Pre-
toria has periodically raised the concept for public
attention. The constellation of states would be codified
by economic and political agreements that would
create a regional bloc essentially controlled by the
Republic. Among the advantages to Pretoria would be
at least indirect regional recognition of the indepen-
dent homelands, which would form part of the con-
stellation, by the other states that South Africa would
like to have associated with it, namely, Mozambique.
Zimbabwe, Angola, Namibia, Malawi, Zambia, Bo-
tswana, Lesotho, Swaziland, and perhaps Zaire Pre-
toria probably assumes that the creation of such a
system would make it much more difficult for other
African states, or any other power, to intervene in the
region's affairs.
16. Pretoria's views of the Marxist states in the
region will affect its plans for regional cooperation.
Many South African deeisionmakers would argue that
mutually cooperative arrangements can be worked out
regardless of the political systems prevailing in the
black-ruled states. Other South African leaders are
more ideologically oriented and would prefer a consis-
tent policy of hostility toward Marxist or socialist
regimes. The South African public has been condition-
ed by years of official rhetoric to regard Marxism as a
direct and total threat to South African stability and
survival. It would therefore seem difficult for Pretoria
to associate freely with Marxist regimes. The results of
bilateral cooperation under the nest security agree-
ments may help to modify South African perceptions,
but the long-range South African expectation is that
continuing pressures will force such regimes to modify
their composition by including non-Marxist political
groups, such as UN11 :A or the National Resistance of
Mozambique (RENAMO).
17. Although South Africa now- seems swilling to
become more closely associated with the Front for the
Liberation of Mozambique (FRELINIO) government
of Mozambique, its long-range goal of a constellation
of states probably envisages modifications in the cony
position of regimes currently Marxist. In Angola,
where South Africa has been deeply committed to
LNITA for years, Pretoria no doubt wants reconcilia-
tion between UNITA and the MPLA govern ntent.
Although South Africa's relationship with and conuuit-
ment to RENAMO in Mozambique is less significant,
Pretoria is actively- promoting talks between Maputo
and the insurgents. In Namibia, on the northwest
border. a SWAPO government would also pose sync
bolic problems for the Republic. The granting of
independence, in Pretoria's view, can include a possi-
bly dominant role for SWAPO; but Pretoria swill try to
ensure that important posts go to other indigenous
parties, and that constitutional guarantees preclude a
one-party or Marxist state. In other countries-Mala-
wi, Lesotho, and Botswana-Pretoria continues to
favor the more conservative elements in the society,
whether or not they hold power.
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 IS. Angola is the major policy problem for South
Vf rica s regional planners. The Marxist AIPI.A govern-
ment has over 30,000 Cuban troops and military
advisers as well as several thousand Cuban civilian
tccbnjcians assisting it in maintaining purser. Their
presence is it problem for it regime that aims at total
dominance of the region, civil though they pose no
immediate threat to the Republic (Cuban troops per-
form basically defensive functions in Angola). Should
the Cubans be invited by a SWAPO-led Namibia to
assist it in its security operations. however, they would
he seen by Pretoria as a much more immediate threat.
Pretoria is intent upon managing Namibian independ-
ence in such a way as to present this In the meantime,
so long as the Cubans keep to their current posture,
their presence serves a useful purpose for Pretoria by
attracting CS involvement in developments in south-
cool Africa and by justifying South African arguments
of a Soviet-Cuban military threat to the region.
19 South African regional policies are based on
pragmatic self-interest and are supported by most of
the white cone nunits For the period of this Estimate,
the nonaggression pacts resulting from these policies
are likcls to hold. The neighboring states are bitterly
aware of the risk then run in permitting the ANC to
use their territory. because then would not be able to
defend themselves against South African military ac-
tion if then engage in behavior Pretoria feels is hostile
to its interests, and because they desperately need
Snulh :African trade, aid, and investment -
The South African Defense Force (SADF)
20 South Africa is the dominant militars power in
southern :Africa. Its military forces are not only larger
and more efficient than ails of the neighboring black
states. but are also highly motivated, well disciplined,
and thoroughly trained. The active-duty force num-
bers over 94.000: if needed. Pretoria could muster an
estimated 300,000 men in 30 clays through a general
mobilization. 'hhe South African Defense Force is
capable of mounting an aggressive and coordinated
militars response to perceived threats.
2 I. Most SADF personnel are white South Africans,
but because of competing demands from the military
and civilian sectors. increased use of nonwhite person-
nel oil a voluntary basis is taking place. Only white
males, however. are presently subject to draft and
reserve obligations- The current system drafts about
25,000 white males and accepts a few thousand volun-
teers white males and females, and it few black,
Colored, and Indian males) each scar Only about
5,000 nonwhites are now in the S\Dl ranks: but,
should Coloreds and Indians become subject to the
draft as a consequence of the limited political partici-
pation for their communities under the new Constitu-
tion, these numbers could increase sharply- Simile
Colored and black troops have already seen combat
and may assume more of the burden in the future as
an alternative to additional increases in for militars
obligation of whites. These troops will also prohahb
receive more equitable treatment within the armed
forces than nonwhites normally enjoy ill civilian life:
-
the SADF's pragmatic interest in improved perlorin
ance has already led it to adopt policies designed to
promote greater racial tolerance anlong its troops
22. Despite the increased importance of nonwhites
in the military. the defense of the country will ulti-
mately remain the responsibility of the NOW,, popula-
tion. Nil, hire males are now liable for hvo years of
active service followed by 12 years of reserve dull.
during which 720 days must be spent on active Juts
Whites must then fulfill it continuing reserve obliga
tion until the age of 55.
23 . Despite budgetary increases, there it, problems
facing the SADF, among them the spotty quality of
leadership at the small-milt level. Career odiccrs and
noncommissioned officers are seldom assigned below
the company level, even though counterinsurgi'ncs
warfare is fought at the section, team, squad. and
platoon levels. Thus, in Namibian and Angolan field
operations, the SADF has experienced incidents of
faulty mapreading, disregard of authority, false som-
hat reports, and the like.
24. Another leadership problem comes from South
Africa's military- isolation- which has meant that al-
most all military training must be done in couutn. In
recent years, the lack of contact with other military
establishments and stall colleges has resulted in gaps in
S:ADF knowledge about new concepts and methodolo-
gies, Training, particularly at the staff College level
and above, has suffered. The system is now producing
senior officers with parochial vision and little or no
appreciation of the world beyond South Africa's
borders.
25. Nonetheless, by Western standards, the quality
of SADF military training is at least adequate I'he
training available is carefully planned and thorough.
with heavy emphasis on field work. The large reserve
force (the Citizen Force-CF) is organized for conven-
tional warfare, while both the standing arms- (Perma-
nent Force-PF) and the reserves are trained for
counterinsurgency operations svbere the govenuneut
9
SECRET
 believes the greatest near-term threat to its security
,% ill arise.
26. The SADF remains equipped largely rcith obso-
lescent but serviceable equipment that is adequate to
meet the military threat it nosy faces. While most of
the active units are equipped kith modern weapons,
the basic rnachinegun remains the Browning 30 cali-
ber. and its main antitank gun is a Ion-velocity 90-
millimeter gun. The SADF lacks modern antiaircraft
defense systems. except for a few Soviet systems
aptured in Angola.
27. Deficiencies in its arms inventory are the conse-
quences of the international isolation inflicted by two
L sited Nations amts embargoes. voluntary in 1963
and mandatory in 1977 In the mid-1960s. South
:African defense planners initiated policies designed to
reduce the country's dependence on foreign equip-
ment. They have since developed channels to foreign
countries and international armaments dealers in an
effort to circumvent the embargo by covert procure-
ment of weapons and technology. South Africa has also
developed the largest indigenous arras industry in
Africa. The government-controlled Armaments Cor-
poration of South Africa iARVISCOR1 has become one
of the country s largest industrial conglomerates.
Tasked specifically to develop and procure weapons.
ammunition. and technology based on the needs of the
SADP. ARV1SCOR covers the entire process of sycap-
ons production from research through manufacture,
servicing, and repair, and currently meets the bulk of
the military's requirements for ground force equip-
ment. It also procures weapons from private firms.
2R. South African efforts to circunnvent the embar-
go have had mixed results. South Africa is able to
produce a vast range of weaponry, much of which-
small arms, ammunition, and armored vehicles-is
important for counterinsurgency operations. AWith the
help of foreign technology, it has produced such
sophisticated items as the extended range G-5 155-min
gun and missile-carrying patrol boats- The SAI)F
extends the life of its aging equipment by fabrication
and by paying high prices for spare parts on the
clandestine international arms market.
29. But these actions do riot entirely compensate for
South African inadequacies. The SADF lacks snare
state-of-the-art military equipment. particularly high-
performance jet aircraft and helicopters. It has no
replacements for its lust-retired Shackleton long-range
reconnaissance aircraft. South Africa also believes it
needs to develop a submarine production capability.
Even the present level of self-sufficiency- in arms
production has been costly- The research and deyelop-
ment and production costs of house-produced items
has led AR\ISCOR to begin an intensive search for
foreign partners and customers to help sustain produc-
tion lines.
30. For the period of this Fstim ate, South Africa
will continue to develop all indigenous arms produc-
tion capability and to procure foreign equipment or
technology through open or clandestine nicans. Much
of this effort will be directed toward Western coun-
tries, particularly the L noted States. Some South Afri-
can weapon systems already have lost their qualitative
advantages over Soviet-supplied weapons in the neigh-
boring black-ruled states-
31. South Africa"s defense policy also has a nuclear
dimension. Pretoria's sense of isolation kind perception
of the military threat in southern Africa in the niid-
1970s induced Pretoria to accelerate the nuclear explo-
sives research and development program that it had
formally launched in 1973- By 1977, South Africa had
constructed a nuclear test site in the Kalahari Desert
and appeared well on the scar toward testing a nuclear
explosives device. The international outcry that fol-
lowed the discovery of the Kalahari site forced Pre-
toria to back off, however- A mysterious flash in the
South Atlantic Ocean in September 1979 spurred
further fears in the international community that
South Africa finally had carried out a test, even
though the available evidence was not conclusive.
Nevertheless. the existence of the Kalahari site and the
flash were enough to raise concerns abroad about
South Africa's nuclear capability. Since then, Pretoria
has followed a policy of calculated ambiguity bus
intimating that it has a nuclear weapons capability
while disavowing any interest in producing or testing a
nuclear device.
32. South Africa's aid to insurgencies for the re-
mainder of the decade will fluctuate, depending on
Pretoria's perceptions of the advantages to be gained
front cooperation with the regimes in power and on its
coon coverall regional strategy- For the next few years
at least, Pretoria will be reluctant to abandon the
leverage that involvement with opposition groups pro-
vides South Africa probably will continue to aid
1 NITA, but is unlikely to renew its large-scale aid to
HENANIO as long as the Mozambican Goyernment
lives up to its side of the Nkoniati agreements.
33. As the AN(:'s sanctuaries in the region are
closed out, one South African motive for waging cross-
border counterinsurgency campaigns will diminish.
although counterinsurgency training will continue to
10
SECRET
 have a high priority The South African Police and the
Commandos local Iv based militia groups reported to
number 200,000 members) will probably be able to
handlr the :ANC externally based challenge without
much difficulty for the rest of the 1980s. But the South
:African military may increasingly be forced to con-
(entrate on internal security matters. Turmoil result-
ing from rising black expectations may be more
difficult to control. The threat from random urban
t errorisni will grow as both left- and right-wing
groups may decide that violent confrontation is the
hest means to focus government attention on their
drnlands But the regime is unlikely to face a serious
threat to its stability from such groups for the period of
this Fstlllurte.
Military Capabilities of the Neighboring States
31. None of the neighboring states, individually or
collectively, can challenge South African military
dominance. Nonetheless, the South Africans are seri-
ously concerned by the continuing deliveries of Com-
munist military equipment to neighboring states and
the presence of foreign troops and advisers in those
countries The systems so far acquired by these coun-
tries. though. are for the most part defensive.
35. At present, Mozambique, Botswana, Zimbabwe,
Zambia. Lesotho. and Angola have Soviet Bloc mili-
tary equipment. The major recipients have been An-
s ola and Mozambique. Angola has received initial
shipments of SI -22 (Fitters) and MIC-23 (Floggers) jet
aircraft and A1I 23.25 (Ilind) helicopters. Mozam-
bique has been supplied with MIG-21 (Fishbed) jets
and V11 24 2.5 helicopters.
36. South Africa is concerned about the improved
Air defenses in both countries, and the vulnerability of
its irreplaceable aircraft to missile systems now in
place- particularly in Angola. In addition, in its De-
ermber 1953 incursion into Angola, SADF leaders
found that their armored cars were ineffective against
Soviet tanks. The Cuban presence in Angola, m ore-
over, restrains South Africa's ability to project its force
Lar into that country.
3-. But although South Africa's regional dominance
is not in danger of being challenged for the course of
this lstinlate, the SADF is not a juggernaut- If the
.arms embargo holds, with South Africa continuing to
In, denied access to state-of-the-art equipment and
technology-particularly with regard to advanced jet
aircraft-amid, if additional large-scale deliveries of
modern euuiprnent improve further defensive capa-
bilities of neighboring states. South African cross-
Table 1
Armed Forces Personnel in Southern Africa
Country
Frontline States
Army
Navy
Air Army
Air Force
Total
Angola
35.000
L500
2,0400
38,511)
Botswana
3,15(1b
50
3,21K)
Mozambique
32,000
700
1,(X0)
33]01
Tanzania
39,8(X)
800
1000)
41,60()
Zambia
12,500
1.8(10
14,304)
Zimbabwe
40.200 e
800
11,000
Total
Other States e
172,300
Lesotho
21)00
20
2.020
Malawi
6,000
100
55
Ii. 155
Swaziland
2,700
Unknown
2,7015
Total
10.875+
South Africa r
76.566
6,600
11,300
94,1(X)
T These figures do not include either paramilitary forces (gendar-
merie, pence, militia, and border guard---except where nnlah or
reserve strength.
e Botswana Defense Force is made up of five infantry tongranies.
Includes border guard-
, Includes 50 personnel in Arrny Patrol Boat Squadron.
I Although Zaire is addressed in other sections of this paper, it is not
considered part of the military composition identified will) southern
Africa.
r Includes 12,000 South African Defense Force person ntI inside
Namibia; but does not include an estimated 1001(X) tx'rsonnel in the
South-West Africa Territory Force
border operations could be hampered- St nth Africa
does not face a serious conventional threat from
adversaries on its borders.
38. The combined manpower strength of the neigh-
boring states' armies far outnumbers the troops South
Africa can muster (see table 1), but these forces are
ineffective. Tile African armies are poorly trained.
supported, housed, and paid. They lack technical
skills, and, not surprisingly, are often demoralized
These armies are also riven by tribal rivalries and, in
many instances, cannot comprehend the concept of a
national interest that transcends tribal boundaries
None of these deficiencies is likely to disappear during
the next decade.
39. But this imbalance between South Africa and its
neighbors is double edged If South Africa is able to
persuade its neighbors that its intentions are peaceful,
the past trends of escalating violence and arms build
11
SECRET
 ups could be halted or reversed Much gill depend oil
South Africa's future policies toward support of insur-
gent movements in neighboring countries If it were to
cease to provide assistance to them-as it seems now to
have clone to RENAVlO-the prospects are good. 7 et
ideology plays all important part in South African
policy. I V CPA and RE\AVlO may appear, to some
South African leaders, as more attractive than the
Marxist regimes now in power in ternis of the kind of
regional political enyirunmeut that South Africa be-
lieves would be most beneficial for its interests.
Table 2
South Africa: Gold Holdings,
Production and Sales, 1970-83
South Africa's Internal Economic Situation
40. South Africa is likely to experience continued
low economic growth through the 1980s. The effect of
this trend on domestic and foreign policy will be
gradual, as economic constraints will not halt the
ruling National Party's determination to protect the
country's security and to retain Afrikaner political
control. The financial pinch, however, will engender a
sense of insecurity among Afrikaners, perhaps demon-
strated in increased aggressiveness both at home and in
the region.
41. Budgetary constraints, moreover. already have
had sonic impact and no doubt contributed to the
South African decision to accelerate the Namibian
independence process and to work out an accommoda-
tion with Angola. The budgetary drain will continue to
be a factor in South African planning for Naruibia_ but
we do not believe that financial considerations alone
will determine South Africa's policy on Namibia.
42 Economic growth projections will be unreliable
indicators for predicting the timing or magnitude of
racial unrest in South Africa. Pretoria's economic
policy makers are unlikely to interpret incidents of
racial unrest as a compelling inducement to ease
growth constraints as a way of dampening black
unemployment. Pretoria will continue to make deci-
sions with an eye primarily to maintaining the econo-
my 's solvency, with lower priority for political and
social conse( uences.
43. The Importance of Gold. Gold has been the
key to South African economic growth. paying for half
of total annual imports, including those capital goods
critical to economic growth But gold production, as a
result of an apparentis irreversible decline in the
richest ore reserves, has declined fairly steadily for
more than a decade, slipping from a high of 1.000
metric tons in 1970 to about 655 tons in 1981. Lower
gold output has shrunk the contribution of overall
mining receipts to real GI)P from 18 percent in 1970
Gold in (;"Id Cold Sulu
G over n agent I'rod action
I' ron
1970
592
1000
1,399
399
1971
365
976
1.2(1.3
227
1972
558
910
717
0
197.3
591
855
822
0
1974
568
759
782
23
1975
552
713
729
16
1976
394
713
571
I Ss
1977
302
-(N7
792
92
1978
304
704
702
0
1979
312
703
695
0
1980
378
673
507
11
1981
289
656
743
n9
1982
235
662
706
14
to 11 percent in 1983. even though production of
minerals other than gold increased by about 7.5 per-
cent. (See table 2.)
44. Foreign exchange shortages would haw been
much more severe had there not been steep, specula-
tive increases in the price of gold in the mid-197th and
in 1980. Increaser) earnings from gold sales-from all
average of $1.8 billion a year in 1970-73 to over $10
billion a year in the 1980s thus fa -offset slightly
more than half of the increase in the average annual
cost of imports and net services (front $5 billion in
1970-73 to nearly $21 billion in 1980-8:3).
45. Foreign exchange constraints have led periodi-
cally to fiscal and monetary policies that deliberately
sacrifice economic growth to stifle import demand
This tight-fisted approach was the principal cause for
the decline in the average rate of economic growth
from 5.7 percent in the 1960s to 2.8 percent since
1970. Even if figures for the past three years of severe
drought and worldwide recession were to be factored
out, the average annual rate of South African econom-
ic growth (1971-80) still would be less than 4 percent
46. Slight increases in gold production have oc-
curred since 1981. Output will continue to be largely
static, with perhaps a slight increase up to the late
1980s.
12
SECRET
 South Africa's Economic Options
47 . 1mess gold prices again rise, Pretoria will not
be able to amid future balance-of-payments predica-
mctrts that still lead it to constrict growth. Apart from
hoping for nest gold discoveries or for large, sustained
price increases, South Africa has essentially- only two
alternatives to periodic clampdowns on growth.
4S. 't'he first option-substantial increases in public
arid private borrowing from Western banks-probably
aireadl troubles economic decision makers in Pretoria;
Siud1 Africa's foreign debt has increased from about
ST billion in 1980 to more than $15 billion in 1984.
Further increases on any major scale are unlikely
because
Thee would mark it significant departure from
the pattern of economic fine-tuning in effect
since the beginning of the decline in gold
production.
They would provide a potential point of leverage
to foreign critics of the South African racial
c stenr-
They would clash with Calvinist-based Afrikaner
w iews of heavy debt as inunoral.
-19- Policy rakers in Pretoria hate long recognized
that their more desirable option would be to increase
nongold exports. The long-term performance of these
exports has been good. Nongold exports grew by a
respectable average of 20 percent annually during the
period 1971-80. but have declined by one-fifth since
19.80 see table 3) This decline-the first in 25 years-
resulted front.
Reduced demand resulting from economic reces-
sion in the principal markets: Western Europe,
the United States, and Japan.
Severe drought in 1983 and 1984, which halted
corn exports.
This coulbinatloll of factors has kept the growth of
nongold exports from offsetting the rise in the cost of
imports
Prospects for Economic Growth in the 1980s
50. "1-he South African Government will continue to
restrict economic growth periodically to minimize
current account deficits, timed largely by speculative
swings in gold prices. An increase of $100 an ounce in
gold prices, for example, would raise the value of
annual gold production by $2.1 billion at the current
rate of output I-Ile chances for a significant increase
Table 3 Sitllta 1 t : $
South Africa: Major Exports
1970
1980
1163
Total
3,651
24,455
I S,72-)
Gold
1,617
II9112
5,926
nongold
2,034
Of which.
Coal
16
932
1.1182
Diamonds
274
1.62_2
1.184
Platinum group metals"
NA"
9410
71141
Metallic ores
132
71f,
46:3
Ferroalloys
-18
503
:358
Corn
75
538
104
a Estimated
Not available.
in gold prices-back to the $800 to $9(1(1 levels of
1980-are poor, however, without an inflationary
surge in the United States and other industrial nations,
or some other unpredictable factor such as it major
intensification of conflict in the Middle East- default
by one or more of the principal debtor nations, or
faltering of the US economic recovery. Given the
unpredictability of gold prices, South Africa's annual
rate of real economic growth in 1984-90 is likely to
average only about 2.5 to 3.0 percent.
The Regional Economic Situation
51. Despite the limitations for sustained growth
predicted. South Africa's economic growth during
1978-83 averaged more than four times the pace of the
combined average rate of its 10 nearest regional
neighbors-Angola, Botswana, Lesotho, Malawi- Mo-
zambique, Swaziland, Tanzania, Zaire. Zambia, and
Zimbabwe (see table 4). South African GDP accounted
for three-fourths of the regional total in 198:3 Zinlha-
bwe was second, with a GDP less than one-tenth of
South Africa's total, and only one-third as large on it
per capita basis. South African GDP, moreover, to-
taled three and a half times the combined output of
the members of the Southern African Development
Coordinating Conference, the regional grouping of
nine of South Africa's neighbors-excluding Zairc-
that was designed to reduce their economic depend-
ence on South Africa, and this gap will not narrow
significantly during the period of this Estimate.
52. Regional Economic Linkages. Business initia-
tives by South African companies and public torpors
13
SECRET
 Table 4
Selected Economic Comparisons of
Southern African Countries
GDP 1953
(Billion C'S Si
GDP per
Capita. 1953
Acrrnge.Annual
Real Growth in
Total Trade,
1982 (Billion
Employ mcnt in
Alanufacturing
Populaliuus Iqs'
Wrillmn preven
('S5)
GDP. 19T8-fib
Fe roe"
US SI
3 7musand e(rsone
SouthAl rita
-90
2.600
1,474
309
Ol her soul here
Africa
26.6
290
549
91 7
Of wlach
Angela
3.6
470
0
2-8
10
Botswana
0.9
9(X)
12.1
.1
4
I.0
Lesotho
0-4 a
290
100
0..5
4
I.-
Malawi
I3
200
3.3
05
42
00
Mozambique
I5
120
:30'
0.1
10
I$1l
Swaziland
0-
1,170.
:3 5
0
14
06
1anzaniu
4.6
220
-04
1(10
20.5
Zaire
3.6
120
0
100
31 2
Zambia
3.4
540
06
80
0.3
Zimbabwe
fi 5
SIX)
42
177)
51
SADCC.1
2J9
380
1) 7
449
00 3
f stimated
Data arc for 1981.
SAD(t. includes all of
Zaire
Lions and the attraction of job and marketing opportu-
pities in South Africa have created a web of economic
ties het ecn South Africa and most southern African
black states. Athile the regional economic ties are
beneficial to both South Africa and its neighbors, the
vast difference in size and degree of self-sufficiency
between the formers economy and the collective
economies of the others makes the ties much more
important to the smaller countries.
53. Transport Ties. All of the southern African
nations except Lesotho are linked by rail to eight ports
in South Africa and Namibia. Lesotho, an enclave
within South Africa. uses truck routes from South
African ports. The five landlocked countries on the rail
system-Botswana, Malawi, Sr'aziland, Zambia, and
Zimbabwe-and the Shaba Region of Zaire are forced
to rely mainly on South African ports, because guerril-
la activity and poor maintenance on the rail links to
the Angolan port of Lobito and to Mozambique's three
ports seriously reduce the capacity of these alternative
outlets. Zaire's port at Matadi, and Tanzania's at Dar
es Salaam, which is connected to the common rail
system, could not handle more than their present
Traffic without substantial upgrading of facilities.
5-4. Nontransport Ties. The three major nontran-
sport ties-trade, investment, and migrant labor-arc
net earners of foreign exchange for South Africa. In
1980. South Africa netted $1 S billion from thew
relationships (see table 5). South Africa is the source of
about one-third of the regions imports, including
practically all of the imports of Rotsvana. Lesotho,
and Swaziland, although most of the neighboring stales
have their largest export market overseas.
55. Remittances to the black states by more than
200,000 migrant workers in South Africa totaled ?$-100-
500 million in 198:3. Such remittances are major
sources of foreign exchange for Botswana. Lesotho.
\lalasci, Mozambique, and Swaziland- For South Afri-
ca, access to foreign migrants provides a umch larc-
er-and thus cheaper-pool of labor than would
otherwise be available. This is particularly- important
to the mining sector, which relies on migrants for
slightly rrrore than one-fourth of its black labor force.
(See table 6.)
56. South ;Africa is also the major source of capital
investment in the region, taking in more from divi-
dends and profits on the operation of the branches and
subsidiaries of South African companies in these
14
SECRET
 Fable 5
South Africa: Trade with Selected
Neighboring States
i
llillinn (S $)
Share of
Partner-
Countrs
Trade
P(rcenry
-fo .~ntl hrm
1lrica
Il wlncl~
Vngnla
25
2
lints..ui,i
61N1
91
~znt
1511
97
VI.Ila,si
162
3-
VI"rembiq ur!
5)1
20
Sn .'I"I11
561
97
1 "T11,111,
14
1
/.Iirr a
n'e
I+
7..un hla ^
81
I l
/.imbahwr
435
27
hntn,rts
Penn e,u them
Afnca
)f ,r hit IT
V1121'1(
104)
Rut wan.'
33
24
Vlalawl
9
\tkvanrhiquc
I5
10
S.. enlmul
106
30
"I ,uieenm
12
2
Ldr~
.aa
Vea
/amhin
5
1EC1.
/imbohsse
299
22
halim.ded
" Data err for 1979
uala ure for 1951
?1 Ant .n,Iilahle
Table 6
South Africa: Origin of Foreign
Mine Workers
1983
19711
1975
196))
196S
(sfllllon ('S S)
Total
303
262
215
213
Of which:
A nKola
- ^
-
-
Botswana
16
17
C
Is
Lesotho
71
105
1^_1
I17
\lalawl
90
5'
14
111
Mozambique
113
11s
78
45
Swaziland
5
7
I8
19
Tanzania
Zaire
Zambia
Zimbabwe
neighboring states than is returned in the form of new
funding for capital investmcnt-
57 Botswana, Lesotho, and Swaziland are the most
dependent. Botstana for investment and technical
and managerial inputs to mining (one-fourth of GDP),
Lmothu for remittances from migrant labor (three-
fourths of ( ' DP), and Su:aailand for revenues from
tourism and for investment (probably more than three-
Since 1950, mine workers hate nmde up about hco-t hints of t lu?
total number of migrant ,orkev, in South Africa from the southern
.African region, ac-cording to our estinlates
h Dashes indicate less than 5,000 worker,
r LitImated
fourths of GDP). South Africa also provides an clement
of grant aid to all three through the Southern African
Customs Lnion (SACL), an organization created to
promote regional trade during the colonial period
Allocations from SACC, including the grant aid, make
up more than half of the total government revenues of
Lesotho and Swaziland and about one-third of
Botswana's.
58. Mozambique's experience since independence
in 1975 illustrates the importance of South Africa to
the smaller regional economies. Before independence,
fees from port and rail shipments, remittances fronn
migrant labor (including a large element of grant aid),
and tourist spending totaled it South African Iran,der
to Mozambique of more than $200 million annually in
foreign exchange, roughly offsetting the latter's chron-
ic overseas trade deficit After independence, mutual
political distrust and it steep decline in the reliabilits
of Mozambican transportation facilities (fo.loscing the
1975-76 departure of Portuguese techni(-ians) induced
South Africa to reduce its trade shipments through
Maputo, cut hiring of migrant labor, and virtualh end
tourist travel. The severing of these revenues was it
major factor in Mozambique's subsequent di.uutrolls
economic performance. Renewal of economic ties with
South Africa was thus one of the principal incentives
for Maputo to sign the Nkonmti mutual security
agreement in March 1984.
15
SECRET
 59. The Zimbabwean economy is the most sensitive
in the region to swings in South African consumer
spending, as sales of manufactured goods in the rela-
tively large South African rnarket account for more
than one-fourth of total Zimbabwean exports. This
linkage. and the similarity of South African and
Zimbabwean mineral exports and weather patterns,
tend to result in tandem economic growth trends for
the two economies.
60. Among the other states, Malawi. Zaire, and
Zambia import South African manufactured goods
and look to South African companies for technical
expertise, investment capital, and entrepreneurial ini-
tiatives. Angola and 'T'anzania disclaim any significant
economic relations with South Africa. but scattered
reporting indicates that South African canned foods
and other processed goods appear from time to time
on their store shelves and on black markets. Angola
relies on DeBeers Corporation of South Africa to
operate its diamond mines.
Prospects for the Regional Economies
61. Average economic growth by South Africa's
regional neighbors probably will rise marginally dur-
ing the last half of the 1980s, but it is unlikely to match
or exceed the expected 2.5- to 3.0-percent growth rate
in South Africa. The entire region will suffer from the
impact of stagnant gold production in South Africa.
decline in expansion of South African demand for
migrant labor and imported commodities, and a re-
duced availability of South African venture funds for
capital investment. Botswana, Lesotho, and Swaziland
will be hurt because the rate of growth of customs
revenues will fall as South Africa cuts imports.
62 Although Zimbabwe and Mozambique can look
forward with fair confidence to improved growth,
these prospects are derived from the likely end of the
three-year drought rather than any surge in develop-
ment. Mozambique also may benefit to some extent
front the N1