US embassy cable - 05MAPUTO255

C O N F I D E N T I A L SECTION 01 OF 04 MAPUTO 000255 
 
SIPDIS 
STATE FOR AF/S - TREGER 
STATE PLEASE PASS TO MCC GAULL 
E.O. 12958: DECL: 02/23/2015 
TAGS: PGOV, PREL, MZ, Chissano 
SUBJECT: MOZAMBIQUE: PRESIDENT CHISSANO RETROSPECTIVE 
 
REF: 2004 MAPUTO 1533 
Classified By: Ambassador Helen La Lime, for reasons 1.4 (b/d) 
 
------- 
Summary 
------- 
1. (C) On February 2 President Joaquim Chissano stepped 
down as leader of the Republic of Mozambique after 18 years 
in power. He took over from Samora Machel in 1986, after 
Mozambique's first president was killed in a airplane 
crash. In 1994 Chissano was elected president in 
Mozambique's first multi-party elections and was narrowly 
re-elected to another five-year-term in December 1999. 
Under his leadership the ruling party FRELIMO adopted a 
strategy of accommodation toward the civil war rebel 
movement RENAMO, negotiating an agreement in 1992 that 
allowed RENAMO and its leader, Afonso Dhlakama, to retain 
substantial power as a political party. 
 
2. (C) Although Machel laid the groundwork, Chissano 
oversaw the successful re-orientation of Mozambique's 
economy away from an Eastern bloc-supported, socialist 
system toward a more free market, private sector-led regime 
following strict World Bank and IMF guidelines. Mozambique 
experienced impressive, though somewhat unbalanced, growth 
under his tutelage after the war ended in 1992, with 
several mega-projects - a gas pipeline and a massive 
aluminum smelter - responsible for a large share of the 
gains. Nonetheless overall poverty levels have declined 
significantly around the country as a result of recovery 
from war and government investment in infrastructure and 
rural development. On the negative side of the ledger, 
Chissano did very little to rein in corrupt associates and 
government officials. During his tenure as President of 
the African Union (AU), Chissano sought to build stronger 
African institutions and to find African-led solutions to 
problems facing the continent. End Summary. 
 
----------------- 
The End of An Era 
----------------- 
3. (U) On February 2 President Joaquim Chissano handed 
power over to his successor, Armando Guebuza, after serving 
as Mozambique's president since late 1986. An early, 
prominent member of the Mozambican Liberation Front 
(FRELIMO), Chissano was Foreign Minister in the first 
decade after Mozambique's independence from Portuguese 
colonial rule and assumed the presidency in 1986 when 
Samora Machel was killed in a suspicious plane crash. To 
end Mozambique's long-running civil war which began in 
1976, Chissano encouraged negotiations with the rebel 
movement RENAMO. (Note: Guebuza was the lead negotiator 
for FRELIMO. End Note.) In October 1992 Chissano and 
RENAMO leader Afonso Dhlakama signed the Rome Peace 
Agreement. Chissano defeated Dhlakama in Mozambique's 
first multi-party elections in 1994. He was re-elected to 
another term in December 1999, again beating Dhlakama, 
although this time by a very narrow and disputed margin. 
 
4. (C) Chissano may have toyed with running for another 
term, which was allowed under the Constitution. However 
after some wrangling at the Central Committee meeting in 
December 2001 in which Guebuza and FRELIMO hardliners 
bested Chissano and the moderates, Chissano had come to 
terms with leaving office. No doubt he was influenced by 
the positive example of Nelson Mandela next door in South 
Africa. 
 
-------------- 
Bringing Peace 
-------------- 
5. (U) Shortly after assuming power in 1986, Chissano took 
the first steps towards a peaceful resolution of the civil 
war, secretly utilizing the Catholic Church to engage 
RENAMO in dialogue. In 1990 he oversaw the approval of a 
new constitution, which gave Mozambique a multi-party 
political system, universal suffrage, an independent 
judiciary, freedom of the press, the right to strike, and 
the framework for a market economy. The constitution 
undercut much of RENAMO's ideology -- that FRELIMO stood 
for socialism. Hastened by the weakening of RENAMO's 
support from neighboring South Africa, where apartheid was 
on the way out, a peace agreement was finally signed by 
RENAMO's leader Afonso Dhlakama and President Chissano in 
Rome on October 4, 1992. The United Nations quickly 
deployed peacekeepers to supervise the cease-fire 
agreement, demobilize the soldiers from the two sides, help 
resettle the millions of refugees both internally and from 
the neighboring countries, and assist in the preparation of 
the first multi-party elections scheduled for late 1994. 
Though Chissano has claimed much of the credit for bringing 
peace to Mozambique, various African statesmen, including 
Zimbabwean President Robert Mugabe, played important roles 
in moving the negotiation process forward, as well. 
 
-------------------------------------- 
The Road to Recovery: Economic Reforms 
-------------------------------------- 
6. (U) Chissano presided over far-reaching economic reforms 
during the first half of his tenure. FRELIMO dropped its 
official Marxist-Leninist designation and began to 
liberalize its economy with an IMF-supported Economic 
Rehabilitation Program (PRE), a precursor to today's Action 
Plan for the Reduction of Absolute Poverty (PARPA). Fiscal 
reforms were introduced, including a value-added tax and 
reform of the customs service, which improved the 
government's revenue collection abilities. Mozambique also 
embarked on an extensive privatization program. When the 
process ended in the mid-1990's close to 1,000 companies 
had been privatized. 
 
7. (C) Chissano weathered considerable criticism during 
this period. FRELIMO conservatives, who are generally more 
nationalistic and less open to market reforms, accused him 
of giving into demands of the multilateral financial 
institutions at the expense of the population. Trade 
unions blamed the government for implementing policies that 
caused mass layoffs. Privatization was messy and riddled 
with corrupt practices, including awarding contracts in an 
opaque manner, bribery and the stripping of company assets. 
Nearly all of the privatized companies ended up in the 
hands of FRELIMO members. RENAMO attacked Chissano for 
cronyism and gained considerable political support among 
those disillusioned by the privatization process. 
 
------------ 
Rapid Growth 
------------ 
8. (U) As a result of economic liberalization and massive 
donor assistance, Chissano's Mozambique has become one of 
the fastest growing economies in southern Africa. Since 
1994 GDP growth has averaged 8 percent per year. In the 
early years recovery projects helped the economy rebound 
from devastation wrought by the civil war, nearly all of 
them funded by foreign donors. Grain production rose from 
760,000 tons in 1993 to 1.8 million tons in 2003. The 
government's repair and maintenance program reduced the 
percentage of impassable roads from 44 percent in 1994 to 
just eight percent ten years later. Mozambique's once 
massive foreign debt was lowered through forgiveness and 
rescheduling under the IMF's Heavily Indebted Poor 
Countries (HIPC) and Enhanced HIPC initiatives; in 2002 the 
USG forgave all Mozambican official bilateral debt. The 
Chissano government succeeded in attracting major investors 
for new mega-projects: a natural gas pipeline to South 
Africa, the construction of a massive green-field aluminum 
smelter, and development of lucrative coal reserves in the 
west of the country. In 2003 and 2004 Mozambique's 
official debt was assigned an international credit rating 
of B/B+ by Fitch Ratings, reflecting Mozambique's positive 
track record on economic reforms, political stability, 
strong economic growth, openness to FDI, and expanding 
exports. 
 
9. (U) Exceptional growth notwithstanding, Mozambique still 
faces significant development challenges. Although the 
economy has grown tremendously under Chissano's rule, many 
ordinary Mozambicans have seen little change. The level of 
poverty declined from 69.4 percent in 1998 to 54.1 percent 
in 2003, but this means that the majority of the population 
still remains below the poverty line. The illiteracy rate 
is about 40 percent and infant disease and mortality rates 
are among the highest in Africa. Life expectancy at birth 
is 46 years, and this figure is expected to decline into 
the 30's by 2010 due to the worsening AIDS epidemic 
(Mozambique's prevalence rate is currently at 15 percent of 
adults). Mozambique remains very dependent on foreign 
assistance: the donor community funds approximately 60 
percent of the national budget. 
 
---------- 
Corruption 
---------- 
10. (C) Chissano was ineffective at reining in corruption 
in his government, except when foreign funds were directly 
involved. A scandal in the mid-90's prompted some donors 
to threaten to reduce assistance, but they backed down when 
the government moved quickly to replenish their programs. 
In the latter half of his tenure, under pressure from donor 
governments, senior officials repeatedly promised to act. 
In 2001 an anti-corruption unit was set up in the Attorney 
General's office. However no one of consequence has been 
punished and overall very little has been done to combat 
corruption. Several wealthy Indo-Mozambicans were 
eventually arrested for the assassination in 2000 of a 
prominent investigative journalist, Carlos Cardoso, who had 
uncovered a major bank fraud scheme involving millions of 
dollars. But their arrest was for murder, not corruption. 
Chissano's son, Nyimpine, was called to testify over links 
to the Cardoso killing in trial proceedings followed very 
closely throughout Mozambique. Ultimately, though, the 
judge in the case let Nyimpine off, a decision that many 
saw as a miscarriage of justice for political purposes. In 
a tacit admission that government dishonesty has increased 
under Chissano, his successor, Armando Guebuza, made 
fighting corruption a central feature of his electoral 
campaign. 
 
--------------------- 
Political Development 
--------------------- 
11. (C) Chissano's essential legacy in the political arena 
is that two parties once at war with each other -- FRELIMO 
and RENAMO -- now contend peacefully for power. The 1990 
constitution opened the way for RENAMO to play a role in 
governing the country. Since the signing of the peace 
agreement in 1992 there have been three sets of general 
(presidential and legislative) elections, with FRELIMO and 
RENAMO the two dominant players. The elections have all 
been relatively free and fair, with the outcome generally 
reflecting popular sentiment despite irregularities in some 
cases. Recently support for both parties has declined, 
however. In 2004 there were fewer FRELIMO votes in both 
the presidential and legislative races than in 1999. A 
common complaint is that the party has lost some of its 
connection with the people, many of whom feel disillusioned 
that earning a living still remains very difficult despite 
FRELIMO's thirty years in power. Unbalanced economic 
development in favor of major cities, Maputo especially, 
against rural areas has also dimmed FRELIMO's appeal. In 
RENAMO's case, in 2003 party president Dhlakama drove out 
several of his most accomplished deputies who had 
questioned his authority and thereafter ran the party as an 
autocrat. He did very little campaigning, only during the 
last few months before the election, even though his rival, 
Guebuza, had made himself very visible throughout the 
country since 2002. In the end RENAMO won only half as 
many votes as it did in 1999. One index of politics' poor 
health in Mozambique is that voter turnout in the 2003 
municipal elections was roughly 30 percent and only 43 
percent in the 2004 general elections (down from 75 percent 
in 1999). 
 
--------------------------------------------- ---------- 
Chissano, the International Figure and Friend of Mugabe 
--------------------------------------------- ---------- 
12. (SBU) In July 2003, President Chissano assumed the 
leadership of the African Union (AU). In his capacity as 
AU President, Chissano sought to build stronger African 
institutions and to find African-led solutions to problems 
facing the continent. During his tenure the AU launched 
its Peace and Security Council and sent peacekeepers to 
Darfur. Beyond using his role as head of the AU to promote 
peace on the continent, his personal relationships with 
many African leaders have allowed him to play an important 
behind-the-scenes role in mediating conflicts, particularly 
in the ongoing difficulties in Zimbabwe. 
 
13. (SBU) Mozambique has a common history and close ties 
with its neighbor Zimbabwe. The Mozambican government 
sheltered Robert Mugabe and his ZANU guerrilla forces 
during Mugabe's struggle against the Ian Smith regime in 
then-Rhodesia in the late 1970's. In response, Rhodesia 
(and later the apartheid South African government) 
retaliated by organizing the Mozambican rebel group, 
RENAMO, to attack ZANU and Mozambican government forces -- 
a localized border-area conflict that ultimately turned 
into Mozambique's disastrous civil war. Chissano is a 
long-time friend of Mugabe, referring to him often as 
"brother" and "coach." In December 2004, while in Zimbabwe 
making a farewell address to Zimbabwe's ruling party, 
Chissano lauded Mugabe and declared that his own retirement 
did not necessarily mean other leaders should follow his 
example. However in a meeting with the Ambassador in 
November 2004 (reftel), Chissano indicated that Mugabe was 
very focused on the succession issue and told us that 
Mugabe might be willing to step aside before elections in 
2008 if, by doing so, he would not be seen as giving in to 
outside pressure, if a strong successor were identified, 
and if the opposition no longer threatened to split apart 
Zimbabwe. 
 
------------------------------ 
Comment: Chissano Next Steps 
------------------------------ 
14. (U) Chissano has now packed up and left the Ponta 
Vermelha palace, and Mozambique now has its third president 
since independence. The fact that country has risen from 
the ashes of civil war to become a unified nation with a 
rapidly growing economy and a relatively open political 
system has won Chissano regional and international 
recognition. Chissano role in bringing peace to 
Mozambique, combined with his considerable experience on 
the African political scene, suggest to many that he will 
now go on to play the role of an African senior statesman, 
mostly likely through the newly created Joaquim Chissano 
Foundation. 
LA LIME