US embassy cable - 05PRETORIA390

UNCLAS SECTION 01 OF 02 PRETORIA 000390 
 
SIPDIS 
 
SENSITIVE BUT UNCLASSIFIED 
 
E.O. 12958: N/A 
TAGS: EAID, SF 
SUBJECT: SOUTH AFRICA: DEMARCHE ON UN MILLENNIUM PROJECT 
REPORT 
 
REF: SECSTATE 11141 
 
(U) SENSITIVE BUT UNCLASSIFIED: PLEASE HANDLE ACCORDINGLY; 
NOT FOR INTERNET DISTRIBUTION. 
 
1. 1. (SBU) Summary.  Per reftel, Econoff met with officials 
at the Department of Foreign Affairs (DFA) and as well as the 
National Treasury to deliver talking points on the Millennium 
Project Report, authored by Professor Jeffrey Sachs.  Econoff 
took the opportunity to ask for their views on Millennium 
Development Goals and South African perspectives on U.S. 
policy.  In general, these officials accept our points 
relating to governance issues, but strongly support Sachs' 
call for more official development assistance and debt 
relief, especially in the case of African countries.  The DFA 
official warned that if the United States did not take 
development seriously, it should not expect the developing 
world to take its security concerns seriously.  End Summary. 
 
2. (SBU) Per reftel, Econoff met with Henri Raubenheimer, 
Director for International Organizations at the Department of 
Foreign Affairs, and Christopher Loewald, Chief Director for 
International Economics at the National Treasury, to deliver 
talking points and broadly share views on the Millennium 
Project Report.  Raubenheimer had just returned from a tour 
at the United Nations, where he worked on UN Millennium 
Development issues, including the Monterrey Consensus. 
Loewald was in the process of moving to the Chief Director 
for Fiscal Policy position, replacing Kuben Naidoo, who in 
March will begin a two-year sabbatical to work at the U.K. 
Treasury.  Director Danel van Rensburg will become Acting 
Chief Director for International Economics. 
 
3. (SBU) Raubenheimer was well versed on Millennium 
Development Goals and had clearly formed an opinion on the 
Millennium Project Report, authored by Professor Jeffrey 
Sachs.  He agreed that governance was a central concern for 
African governments, but thought that sometimes developed 
countries unfairly judged African governments that were 
"trying to do the right thing."  As an example, he cited the 
troubles that the Government of Guinea Bissau had in gaining 
donor support to hold elections after a "popular" coup 
d'etat.  In general, his view was that donor conditionalities 
were too extensive, often conflicting, and prevented African 
governments from doing what they needed to do.  Raubenheimer 
clearly saw a leading role for government in development, and 
took the greatest exception to what he saw as U.S. emphasis 
on the private sector as the only solution to growth and 
development.  He claimed that the jury was still out for many 
countries as to which governmental role model they would 
adopt, e.g., the Indian, Malaysian, or even the Chinese 
model. 
 
4. (SUB) Raubenheimer clearly supported Sachs' call for more 
official development assistance and debt relief "without 
strings" for developing countries.  He also argued that 
lopsided trade rules favored developed countries at the 
expense of developing countries.  His final point came in the 
form of a short lecture on how the United States should not 
expect the developing world to take its security concerns 
seriously if it did not take development seriously. 
Raubenheimer warned that to a great extent the security of 
the United States rested with the success of developing 
countries. 
 
5. (SBU) Loewald provided a more measured view of what South 
Africa felt was possible in the context of the UN Millennium 
Project Report and Development Goals.  He stressed that South 
Africa very much agreed with precepts set forth in the 
Monterrey Consensus -- i.e., that development be a 
partnership.  He said that Finance Minister Trevor Manuel 
agreed with calls for rich countries to provide more official 
development assistance and debt relief.  Speaking for 
himself, Loewald said he clearly understood the supportive 
role that conditionalities played for reform-minded Ministers 
of Finance in some countries, but that more resources still 
had to be made available for them to accomplish their goals. 
He specifically cited Mozambican Prime Minister and Minister 
of Finance Luisa Diogo's complaint that, even after HIPC, 
Mozambique spent more on debt service than it did on 
education.  For this reason, Loewald said, Minister Manuel 
felt that more debt relief had to be provided.  Nevertheless, 
Loewald was surprised to hear Manuel's public support for IMF 
gold revaluation (in Cape Town during the Blair Commission 
for Africa's January 17-18 consultation meeting with African 
Finance Ministers) as a means to fund further debt relief, 
since the position had not been vetted at National Treasury. 
 
6. (SBU) Loewald understood that the United States would not 
be joining Britain's proposed international financing 
facility, but commented that it was "important for the U.S. 
to not stand in the way of others."  Loewald was surprised to 
learn that the United States did not subscribe to the 0.7% of 
GDP target for official development assistance from developed 
countries as set forth in the Millennium Development Goals. 
 
7. (SBU) When asked about managing Manuel's role as member of 
the World Bank's Development Committee, i.e., having to 
juggle the demands of African Finance Ministers with the 
interests of the World Bank, especially when South Africa had 
no experience with a World Bank or IMF program, Loewald 
chuckled that it had been done "with great difficulty." 
MILOVANOVIC