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DATE=10/6/1999 TYPE=CORRESPONDENT REPORT TITLE=ANGOLA / COFFEE AND DIAMONDS (L-O) NUMBER=2-254715 BYLINE=ALEX BELIDA DATELINE=JOHANNESBURG CONTENT= VOICED AT: INTRO: The war in Angola continues to take a heavy toll on the country's economy as fierce fighting rages between government forces and rebels of the UNITA movement. Correspondent Alex Belida reports from our Southern Africa Bureau. TEXT: The Johannesburg newspaper "Business Day" publishes a weekly column in which foreign firms post requests for specific merchandise from South-African suppliers. This week, the column features an unusual request from a firm in the Angolan capital, Luanda. It is looking for coffee. What is unusual about the request is that back in the mid-1970's, Angola was the world's fourth-largest coffee producer, harvesting more than 200-thousand- tons a year. Along with oil and diamonds, coffee was one of Angola's leading export earners. But continuing armed conflict, combined with neglect of the country's coffee plantations, drought, and transportation difficulties have left Angola unable to meet its own domestic consumption needs. Production in 1993 fell to just five-thousand tons. The government had been optimistic the country's 1994 peace agreement would reverse the fortunes of coffee producers. But that agreement has collapsed and heavy fighting is once again reported in Angola. Tens-of-thousands of Angolans have been displaced by the latest phase of the long-running civil war between government forces and troops of the UNITA rebel movement. Hundreds of people are reported starving to death daily -- despite efforts by international humanitarian aid groups to distribute emergency food aid. In a recent statement, UNITA blasted the government for spending hundreds-of-millions of dollars on the purchase of military equipment for use in its current offensive against the rebels. However, recent refugees from rebel-held territory have claimed hunger and disease are also widespread in areas under UNITA control. UNITA is widely believed to have financed its side of the war from the sale of diamonds mined in its territory and exported in violation of U-N sanctions. The international diamond firm, De Beers, denies it has ever bought diamonds from the rebels. But in a statement this week, it announced it is placing an embargo on the purchase of all diamonds from Angola, except for those it has previously contracted to buy from a government-backed joint mining venture. In addition, De Beers, the world's leading diamond sales company, says it is urging its clients to adopt a similar embargo against Angolan diamonds -- a move which analysts say is likely to hurt both the government and the rebels. (SIGNED) NEB/BEL/JWH/RAE 06-Oct-1999 11:02 AM EDT (06-Oct-1999 1502 UTC) NNNN Source: Voice of America .

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