SCENESETTER FOR U/S REUBEN JEFFERY'S VISIT TO ANGOLA

UNCLAS SECTION 01 OF 05 LUANDA 000537 SIPDIS FROM AMBASSADOR DAN MOZENA E.O. 12958: N/A TAGS: PREL OVIP JEFFERY REUBEN ECON PGOV EAID AO SUBJECT: SCENESETTER FOR U/S REUBEN JEFFERY'S VISIT TO ANGOLA ¶1. (U) My staff and I warmly welcome your July 21-22 visit to Angola. Your visit, the highest level USG visit to Angola since Secretary Powell's four-hour stop in September 2002, manifests what the Angolan government most wants from America: respect. I hope your visit presages more high level USG engagement with Angola. Your visit affords an excellent opportunity to engage Angolans on a range of issues, including regional stability (especially Zimbabwe and DRC),democracy (in the context of Angola's September legislative elections, the first in 16 years),economic reform and diversification. The government remembers well that the U.S. backed their enemies, the losing horses in the nation's horrific civil war, but nonetheless seems increasingly open to deepening the relationship with the U.S. and continues to value its long relationship with American oil companies. Angola's annual economic growth rate is over 20 percent, but most Angolans live in abject poverty. Although the government seeks greater US investment beyond the oil/gas sector, it has much to do to make the investment climate more appealing to potential investors. Many members of a new generation of economic leaders are open to economic reform; your visit will help chart how best the U.S. can support much needed reforms. ¶2. (U) Angola matters to the United States. Specifically, a peaceful, stable Angola is essential to the peace and security of central and southern Africa. Also, Angola has a large, healthy, and relatively capable military, one that could play a much larger role in fostering peace on this troubled continent. In addition, Angola is America's sixth or seventh largest source of imported oil (depending upon the state of Iraq's pipelines,) a source outside the volatile Middle East. In pursuit of these strategic interests, we seek an Angola that is peaceful, secure, prosperous, healthy and democratic. When I presented my credentials to President Dos Santos this past January, he told me that he shared this vision of Angola and urged me to work with his government to make this vision a reality. Today, our endeavors in Angola focus on advancing Angola's development along these lines. ¶3. (U) In some respects, Angola is only six years old. Following the February 2002 end of its civil war, Angola first overcame a massive humanitarian disaster in feeding and resettling millions of internally displaced persons and refugees. U.S. food assistance was key to averting widespread starvation. Successfully averting this disaster, Angola has now shifted to a huge reconstruction campaign to rebuild the nation's devastated physical infrastructure (roads, railroads, schools, clinics, telecommunications and other utilities). Although the U.S. continues to play an important role in helping Angola deal with the millions of land mines and unexploded ordnance, which obstruct reconstruction, the huge and lucrative contracts for the reconstruction work have gone to others, especially the Chinese, Brazilians and Portuguese. American petro-dollars fund these contracts to a great extent. I would like to see more of these petro-dollars coming back to the U.S. ¶4. (U) Meanwhile, Angola is strengthening its emerging democratic institutions. On September 5, it will hold elections for the national assembly; these will be Angola's first elections in 16 years. The game plan is to hold presidential elections next year and local elections, the first ever in Angola's history, in 2010. We are an important partner in helping Angola prepare for these elections. ¶5. (U) Angola seeks a more prominent role in the region. It has engaged constructively in helping stabilize neighboring DRC (a strategic Angolan objective,) and it has provided some limited forces to peacekeeping operations in select parts of Africa but could do so much more in this regard. As chairman of the SADC Troika of the Organ on Politics, Defense, and Security Cooperation, Angola is pivotal in ongoing SADC efforts to find a solution to the deepening crisis in Zimbabwe. The Economy -------------- ¶6. (U) Angola's economy is one of the fastest growing in the world, thanks to growing oil production and rising oil prices. Although oil production is supposedly capped by OPEC at 1.9 million barrels per day (bpd),Angola is currently producing about 2.0 million bpd; production is expected to plateau within a year or so at about 2.2 million bpd. Angola's economy grew by 19.5 percent in 2006 and 23.4 percent in 2007, and should match or beat that pace in 2008. Inflation was reduced from triple digits near the end of the war to just under 12 percent last year. Thanks to petroleum revenue, foreign exchange reserves are growing rapidly; Angola currently has an estimated USD 15 billion in reserve. Angola paid off the USD 6 billion principal of its Paris club debt in late 2007 and early 2008, and then negotiated payment of late interest arrearages. ¶7. (U) Angola's impressive success on the macro-economic front has yet to yield tangible benefits for most Angolan citizens, 12 million of whom live on less that $1.70 per day. Angola ranks 162 out of 177 countries in the UNDP Human Development Index, and maternal and child mortality rates are among the worst in the world. Unemployment and underemployment are rampant, as the high-tech oil sector creates relatively few jobs for Angolans. Angola's challenge LUANDA 00000537 002 OF 005 ¶1. (U) My staff and I warmly welcome your July 21-22 visit to Angola. Your visit, the highest level USG visit to Angola since Secretary Powell's four-hour stop in September 2002, manifests what the Angolan government most wants from America: respect. I hope your visit presages more high level USG engagement with Angola. Your visit affords an excellent opportunity to engage Angolans on a range of issues, including regional stability (especially Zimbabwe and DRC),democracy (in the context of Angola's September legislative elections, the first in 16 years),economic reform and diversification. The government remembers well that the U.S. backed their enemies, the losing horses in the nation's horrific civil war, but nonetheless seems increasingly open to deepening the relationship with the U.S. and continues to value its long relationship with American oil companies. Angola's annual economic growth rate is over 20 percent, but most Angolans live in abject poverty. Although the government seeks greater US investment beyond the oil/gas sector, it has much to do to make the investment climate more appealing to potential investors. Many members of a new generation of economic leaders are open to economic reform; your visit will help chart how best the U.S. can support much needed reforms. ¶2. (U) Angola matters to the United States. Specifically, a peaceful, stable Angola is essential to the peace and security of central and southern Africa. Also, Angola has a large, healthy, and relatively capable military, one that could play a much larger role in fostering peace on this troubled continent. In addition, Angola is America's sixth or seventh largest source of imported oil (depending upon the state of Iraq's pipelines,) a source outside the volatile Middle East. In pursuit of these strategic interests, we seek an Angola that is peaceful, secure, prosperous, healthy and democratic. When I presented my credentials to President Dos Santos this past January, he told me that he shared this vision of Angola and urged me to work with his government to make this vision a reality. Today, our endeavors in Angola focus on advancing Angola's development along these lines. ¶3. (U) In some respects, Angola is only six years old. Following the February 2002 end of its civil war, Angola first overcame a massive humanitarian disaster in feeding and resettling millions of internally displaced persons and refugees. U.S. food assistance was key to averting widespread starvation. Successfully averting this disaster, Angola has now shifted to a huge reconstruction campaign to rebuild the nation's devastated physical infrastructure (roads, railroads, schools, clinics, telecommunications and other utilities). Although the U.S. continues to play an important role in helping Angola deal with the millions of land mines and unexploded ordnance, which obstruct reconstruction, the huge and lucrative contracts for the reconstruction work have gone to others, especially the Chinese, Brazilians and Portuguese. American petro-dollars fund these contracts to a great extent. I would like to see more of these petro-dollars coming back to the U.S. is to kick-start the now-moribund non-oil sectors to generate jobs for the nation's young and rapidly growing population, which largely remains on the sidelines of the economic boom. Agriculture and agriculture processing offer the most promise; Angola once was a major food producing and exporting country. Other sectors rich with potential include fisheries, forestry and light industry. ¶8. (U) Investment is key to unleashing the non-oil sectors of the economy, but Angola remains a difficult environment for such investment. Angola continues to rank near the bottom in most of the World Bank's "Doing Business" indicators. According to the 2007 index, Angola ranks 167 out of 178 countries in promoting an open and efficient business climate, and its rankings of 173 out of 178 in the category of "starting a business" and 176 out of 178 in "enforcing contracts" are of particular concern for investors. Rule of law is weak; corruption is pervasive; and, the cost of doing business here is high, as Angola, especially Luanda, is among the most expensive places in the world. Basic infrastructure, roads, railroads, electricity supply, water, ports, and air service are all deeply deficient, thus driving up further the cost of doing business here. Clearly, deep, broad-based reform is essential if ever Angola is to attract the investment needed to energize the economy. Politics and Elections -------------- ¶9. (SBU) Angola is nominally a multi-party democracy, but its government is dominated by the Popular Movement for the Liberation of Angola (MPLA) and a strong chief executive, Jose Eduardo Dos Santos, who has been in office since 1979. Angola's only democratic elections since independence in 1975 were held in 1992. The result was disputed by Jonas Savimbi, leader of the opposition party Union for the Total Independence of Angola (UNITA),who plunged the nation back into civil war for another decade. That devastating war ended only in February 2002, when Savimbi was killed in battle. ¶10. (U) Angola has made impressive progress in preparing for the September legislative elections, the first since 1992. The high-tech voter registration put over 8 million Angolans on the voter rolls. U.S. assistance for democracy-building and good governance in FY 07 was approximately $7.5 million. Our programs are administered through USAID and implemented by the International LUANDA 00000537 003 OF 005 ¶1. (U) My staff and I warmly welcome your July 21-22 visit to Angola. Your visit, the highest level USG visit to Angola since Secretary Powell's four-hour stop in September 2002, manifests what the Angolan government most wants from America: respect. I hope your visit presages more high level USG engagement with Angola. Your visit affords an excellent opportunity to engage Angolans on a range of issues, including regional stability (especially Zimbabwe and DRC),democracy (in the context of Angola's September legislative elections, the first in 16 years),economic reform and diversification. The government remembers well that the U.S. backed their enemies, the losing horses in the nation's horrific civil war, but nonetheless seems increasingly open to deepening the relationship with the U.S. and continues to value its long relationship with American oil companies. Angola's annual economic growth rate is over 20 percent, but most Angolans live in abject poverty. Although the government seeks greater US investment beyond the oil/gas sector, it has much to do to make the investment climate more appealing to potential investors. Many members of a new generation of economic leaders are open to economic reform; your visit will help chart how best the U.S. can support much needed reforms. ¶2. (U) Angola matters to the United States. Specifically, a peaceful, stable Angola is essential to the peace and security of central and southern Africa. Also, Angola has a large, healthy, and relatively capable military, one that could play a much larger role in fostering peace on this troubled continent. In addition, Angola is America's sixth or seventh largest source of imported oil (depending upon the state of Iraq's pipelines,) a source outside the volatile Middle East. In pursuit of these strategic interests, we seek an Angola that is peaceful, secure, prosperous, healthy and democratic. When I presented my credentials to President Dos Santos this past January, he told me that he shared this vision of Angola and urged me to work with his government to make this vision a reality. Today, our endeavors in Angola focus on advancing Angola's development along these lines. ¶3. (U) In some respects, Angola is only six years old. Following the February 2002 end of its civil war, Angola first overcame a massive humanitarian disaster in feeding and resettling millions of internally displaced persons and refugees. U.S. food assistance was key to averting widespread starvation. Successfully averting this disaster, Angola has now shifted to a huge reconstruction campaign to rebuild the nation's devastated physical infrastructure (roads, railroads, schools, clinics, telecommunications and other utilities). Although the U.S. continues to play an important role in helping Angola deal with the millions of land mines and unexploded ordnance, which obstruct reconstruction, the huge and lucrative contracts for the reconstruction work have gone to others, especially the Chinese, Brazilians and Portuguese. American petro-dollars fund these contracts to a great extent. I would like to see more of these petro-dollars coming back to the U.S. Republican Institute (IRI),the National Democratic Institute (NDI), and IFES. They focus on educating voters, building civil society capacity, strengthening political parties, and providing technical assistance on the logistics of elections. We expect the elections to be peaceful, but the concentration of power and wealth in the ruling party and the state control of media tilt the playing field in the incumbents' favor. Military Cooperation -------------- 11.(U) Bilateral cooperation in the military sphere has been the toughest nut to crack. Angolan participation in the International Military Education and Training Program (IMET) has gone to virtually zero. Angolan engagement in other proposed activities (VIP visits, US defense-related conferences and programs, and a wide variety of assistance programs) has been hit or miss, mainly miss. In April, I raised directly with President Dos Santos our concern that military-to-military cooperation was not advancing along the lines that he had told me during my January credentialing. Dos Santos responded that he would "look into this" concern, and subsequently there has been some movement in breaking this bilateral logjam. Whether this progress continues remains to be seen, given the seeming antipathy of Angolan leaders for military engagement with the U.S. Human Rights Record is Poor -------------- ¶12. (U) Angola's human rights record is poor. The country's overburdened judicial system does not protect the rights of individuals. Elements of the military and police continue to disregard human rights. A December 2007 report by Doctors without Borders (MSF) documented systematic abuse, including mass rape, by Angolan security forces of illegal Congolese immigrants who were being deported from the diamond-rich Lunda Norte. The Army Chief of Staff promised to investigate the allegations, but he has not issued any report of his findings or taken any evident action against perpetrators. Reports of security force abuses of illegal Congolese continue. ¶13. (U) Prisons are overcrowded and conditions harsh, especially in the provinces. The NGO movement is still nascent, but there are some indigenous organizations tracking human rights abuses and LUANDA 00000537 004 OF 005 ¶1. (U) My staff and I warmly welcome your July 21-22 visit to Angola. Your visit, the highest level USG visit to Angola since Secretary Powell's four-hour stop in September 2002, manifests what the Angolan government most wants from America: respect. I hope your visit presages more high level USG engagement with Angola. Your visit affords an excellent opportunity to engage Angolans on a range of issues, including regional stability (especially Zimbabwe and DRC),democracy (in the context of Angola's September legislative elections, the first in 16 years),economic reform and diversification. The government remembers well that the U.S. backed their enemies, the losing horses in the nation's horrific civil war, but nonetheless seems increasingly open to deepening the relationship with the U.S. and continues to value its long relationship with American oil companies. Angola's annual economic growth rate is over 20 percent, but most Angolans live in abject poverty. Although the government seeks greater US investment beyond the oil/gas sector, it has much to do to make the investment climate more appealing to potential investors. Many members of a new generation of economic leaders are open to economic reform; your visit will help chart how best the U.S. can support much needed reforms. ¶2. (U) Angola matters to the United States. Specifically, a peaceful, stable Angola is essential to the peace and security of central and southern Africa. Also, Angola has a large, healthy, and relatively capable military, one that could play a much larger role in fostering peace on this troubled continent. In addition, Angola is America's sixth or seventh largest source of imported oil (depending upon the state of Iraq's pipelines,) a source outside the volatile Middle East. In pursuit of these strategic interests, we seek an Angola that is peaceful, secure, prosperous, healthy and democratic. When I presented my credentials to President Dos Santos this past January, he told me that he shared this vision of Angola and urged me to work with his government to make this vision a reality. Today, our endeavors in Angola focus on advancing Angola's development along these lines. ¶3. (U) In some respects, Angola is only six years old. Following the February 2002 end of its civil war, Angola first overcame a massive humanitarian disaster in feeding and resettling millions of internally displaced persons and refugees. U.S. food assistance was key to averting widespread starvation. Successfully averting this disaster, Angola has now shifted to a huge reconstruction campaign to rebuild the nation's devastated physical infrastructure (roads, railroads, schools, clinics, telecommunications and other utilities). Although the U.S. continues to play an important role in helping Angola deal with the millions of land mines and unexploded ordnance, which obstruct reconstruction, the huge and lucrative contracts for the reconstruction work have gone to others, especially the Chinese, Brazilians and Portuguese. American petro-dollars fund these contracts to a great extent. I would like to see more of these petro-dollars coming back to the U.S. working with the GRA to train the national police on human rights issues. Angola's 2007 candidacy for a three-year term on the UN Human Rights Council was seen by many as an indicator of increased willingness to engage with the international community on human rights issues, but the GRA's April 2008 decision to close the local UN Human Rights Office (in direct contradiction to a written promise made in campaigning for the seat on the UNHRC) raises question about the nation's commitment to protecting human rights. ¶14. (U) USG-funded programs have helped train police through the International Law Enforcement Academy (ILEA) in Gaborone. In addition, USG-funded international organization partners in Angola have provided training and capacity-building for law enforcement officials on specific issues such as trafficking in persons and child rights. The USG and the Portuguese government also automated the Luanda Provincial criminal court. Peace and Security -------------- ¶15. (SBU) Angola emerged from conflict littered with the refuse of war. Millions of landmines and unexploded ordnance continue to kill and maim Angolans and impede the country's reconstruction and development. Demining is a GRA priority. Government demining focuses on land clearance for large reconstruction projects like railroads and electric transmission towers. Humanitarian demining continues to be done almost exclusively by international and national NGOs. USG remains a major player in demining (USD 6 million in FY-07 and a total of USD 56 million since 1995),helping to restore access to war torn areas, return land for agricultural, social and productive use, and build the capacity of the national demining authority. Development and US Assistance -------------- ¶16. (U) Despite recent economic growth and development, Angola still has some of the lowest development indicators in the world. Although statistical data are imprecise, best international estimates are that 68 percent of the population lives in poverty, 26 percent in abject poverty. Life expectancy is 47 years, more than 30 percent lower than the average for developing nations; infant mortality, maternal mortality and other measures of the quality of life are among the worst in the world. Fertility is high, an average LUANDA 00000537 005 OF 005 ¶1. (U) My staff and I warmly welcome your July 21-22 visit to Angola. Your visit, the highest level USG visit to Angola since Secretary Powell's four-hour stop in September 2002, manifests what the Angolan government most wants from America: respect. I hope your visit presages more high level USG engagement with Angola. Your visit affords an excellent opportunity to engage Angolans on a range of issues, including regional stability (especially Zimbabwe and DRC),democracy (in the context of Angola's September legislative elections, the first in 16 years),economic reform and diversification. The government remembers well that the U.S. backed their enemies, the losing horses in the nation's horrific civil war, but nonetheless seems increasingly open to deepening the relationship with the U.S. and continues to value its long relationship with American oil companies. Angola's annual economic growth rate is over 20 percent, but most Angolans live in abject poverty. Although the government seeks greater US investment beyond the oil/gas sector, it has much to do to make the investment climate more appealing to potential investors. Many members of a new generation of economic leaders are open to economic reform; your visit will help chart how best the U.S. can support much needed reforms. ¶2. (U) Angola matters to the United States. Specifically, a peaceful, stable Angola is essential to the peace and security of central and southern Africa. Also, Angola has a large, healthy, and relatively capable military, one that could play a much larger role in fostering peace on this troubled continent. In addition, Angola is America's sixth or seventh largest source of imported oil (depending upon the state of Iraq's pipelines,) a source outside the volatile Middle East. In pursuit of these strategic interests, we seek an Angola that is peaceful, secure, prosperous, healthy and democratic. When I presented my credentials to President Dos Santos this past January, he told me that he shared this vision of Angola and urged me to work with his government to make this vision a reality. Today, our endeavors in Angola focus on advancing Angola's development along these lines. ¶3. (U) In some respects, Angola is only six years old. Following the February 2002 end of its civil war, Angola first overcame a massive humanitarian disaster in feeding and resettling millions of internally displaced persons and refugees. U.S. food assistance was key to averting widespread starvation. Successfully averting this disaster, Angola has now shifted to a huge reconstruction campaign to rebuild the nation's devastated physical infrastructure (roads, railroads, schools, clinics, telecommunications and other utilities). Although the U.S. continues to play an important role in helping Angola deal with the millions of land mines and unexploded ordnance, which obstruct reconstruction, the huge and lucrative contracts for the reconstruction work have gone to others, especially the Chinese, Brazilians and Portuguese. American petro-dollars fund these contracts to a great extent. I would like to see more of these petro-dollars coming back to the U.S. of 5.8 births per woman. ¶17. (U) USAID programs help Angola address the challenges of achieving long-term stability and improving the quality of life for its citizens. Our flagship program is the President's Malaria Initiative (PMI),which seeks to halve by 2010 mortality from malaria among children under five, and we're on track to do that. The Angolan government, in particular the Health Ministry, has been closely involved in the program, and collaboration with other donors is strong. In FY-07, the second year of implementation, PMI sprayed over 110,000 houses (affecting over 500,000 Angolans),distributed over 90,000 bed nets and furnished over 2.4 million treatments for malaria. ¶18. (U) The USG is also highly visible in the fight against HIV/AIDS. Angola presents a unique opportunity to combat the spread of HIV/AIDS. According to the best available data, Angola has a relatively low prevalence rate (2.1 percent among adults),but areas bordering higher-prevalence neighboring countries have rates now up to four times as high and rising. Angola has many factors that contribute to the spread of HIV/AIDS: early age of sexual debut, common practice of multiple concurrent sex partners, and increased cross border trade with countries that have significantly higher HIV/AIDS infection rates. The USG (CDC, USAID, State and Defense) is working as a strong interagency team in partnership with the Angolan government, especially the Ministry of Health, private partners and NGOs to implement the national plan against HIV-AIDS. ¶19. (U) The USG supports job creation to promote broad-based economic growth. Small and medium enterprises in Angola lack management and technical skills, and have limited access to technology and capital. A bilateral agreement with the Angolan Central Bank helps with finance; other programs help with skills. Agriculture could employ large numbers of people but lacks inputs, credit, and access to markets. USAID assistance strengthens the value chains for crops with commercial potential: bananas, potatoes and coffee. MOZENA