1. The present report is submitted pursuant to paragraph 14 of Security Council resolution 1233 (1999) of 6 April 1999, by which the Council requested me to keep it regularly informed and to submit a report every 90 days on developments in Guinea-Bissau and on the activities of the United Nations Peace-building Support Office in Guinea-Bissau (UNOGBIS).

2. Members of the Security Council will recall that in my last report, of 16 March 2001 (S/2001/237), I described the efforts of the Government to preserve and consolidate the country’s nascent democratic order in the aftermath of the failed November 2000 coup attempt as well as activities of UNOGBIS in support of those efforts.

3. Following the discussion of that report, the Security Council, on 29 March 2001, in a statement to the press, called upon all parties to cooperate towards forming a broad-based and effective government, encouraged the leaders of Guinea-Bissau and Senegal to continue their bilateral efforts to stabilize the situation along their common border and called upon the international community to provide urgent assistance to enable the Government of Guinea-Bissau to meet the most basic needs of the country’s population.

4. Subsequently, on 10 April 2001, Assistant Secretary-General Ibrahima Fall, briefing the Security Council on the conclusions and recommendations of the Inter-Agency Mission that I had dispatched to West Africa from 6 to 27 March 2001 (S/2001/434), reported that the overall situation in Guinea-Bissau remained volatile, with a high risk of continuing instability in the near and medium term. He indicated that the Inter-Agency Mission had concluded that urgent financial and capacity-building assistance by the international community was needed to help prevent Guinea-Bissau from relapsing into open conflict.

5. The present report covers developments since my report of 16 March 2001 and Mr. Fall’s briefing, highlighting, in particular, efforts to stabilize the situation in the country and to strengthen fragile democratic institutions, in order to enable them to address more effectively the urgent political, economic, social and security crises the country faces. The report also outlines the contributions of UNOGBIS to the difficult but ongoing post-conflict peace-building process.

6. The political situation has been dominated in the period under review by strong and prolonged friction between the executive and the legislative branches of government over the choice of Prime Minister. Faustino Imbali, whom President Kumba Yala appointed on 20 March 2001, was vehemently opposed by parliamentarians, mainly from opposition parties, but also including members of the President’s party, the Party of Social Renewal (PRS), which Mr. Imbali, formerly an independent presidential candidate, joined a week before his appointment as Prime Minister. Led by the opposition, the National Assembly repeatedly refused to confirm Mr. Imbali and his Government. As a result, through the months of April and May, the country practically operated without an effective government, and the announcement of yet another foiled coup attempt in mid-April demonstrated once again the fragility of the political and democratic processes. Amid rising social tensions, the National Assembly, on 30 April, convened, at the opposition’s demand, in an extraordinary session to discuss the country’s instability. The Assembly gave the Government a month to present its programme and the budget.

7. During this unstable period, civil society, led by the Bishop of Bissau, called upon political actors to engage in dialogue in order to stabilize the country. For his part, my Representative, Samuel C. Nana-Sinkam, continued to provide his good offices to facilitate compromise. Finally, on 17 May, the National Assembly, by a vote of 56 to 43, approved the programme of work of Mr. Imbali’s Government, which was composed of 23 members drawn mainly from the President’s PRS party, but also included several ministers serving in an independent capacity. On 30 May, the Assembly approved the Government’s budget, with 56 parliamentarians voting for it and 39 abstaining.

8. To promote a culture of peace, tolerance and political dialogue, UNOGBIS organized in Bissau, from 28 March to 1 June 2001, a seminar on the consolidation of multi-party democracy in collaboration with the country’s 17 political parties and the parliament; this was a follow-up to a similar seminar held in January 2001. The seminar, funded by the Government of the Netherlands, brought together 120 representatives of political parties, the media, civil society and trade unions, and included 50 women. Discussions were facilitated by six international and four Bissau Guinean experts who focused on the promotion of better understanding of the principles of a democratic society.

9. UNOGBIS has also continued to provide legal expertise, as needed, to the Technical Committee on the Review of the Constitution established by the National Assembly with a view to bringing the country’s Constitution in line with internationally recognized norms.

10. Despite persistent political instability, preparations have continued for municipal elections, now scheduled for December 2001 or early January 2002. The National Assembly has received the recommendations of the inter-ministerial Technical Committee on electoral legislation and intends to finalize it shortly. The Committee, which continues to benefit from the services of an electoral expert provided by the United Nations, has already prepared the electoral budget. However, owing to financial difficulties, implementation of the various recommendations has been stalled, and the Government has indicated its intention to seek assistance from the donor community for the organization and conduct of the elections.

11. At the international level, Guinea-Bissau has continued to strengthen cooperation with its immediate neighbours and beyond the subregion. In particular, following President Yala’s visit to Conakry from 30 April 2001 to 2 May 2001, he and President Conté signed a protocol on friendly relations and good-neighbourliness and called for the strengthening of bilateral cooperation, especially in the socio-economic and political domains. During his second visit to Abuja, from 13 to 15 June, President Yala and his Nigerian counterpart, President Obasanjo, agreed to strengthen bilateral economic cooperation. To that end, Nigerian entrepreneurs are expected in Bissau shortly to explore investment prospects. President Obasanjo also presented President Yala with a financial contribution of US$ 1 million to assist, in particular, with the Government’s efforts to restructure the Bissau Guinean armed forces.

12. The activities of rebels of the separatist Movement of Democratic Forces of Casamance (MFDC) in the border areas between Guinea-Bissau and Senegal remained the most serious security challenge to Guinea-Bissau during the period. Since Bissau Guinean forces launched a military offensive against the rebels in March 2001 to force them from the country’s north-west region, the border situation has remained tense. Armed skirmishes between the rival factions of MFDC continue, sometimes on Bissau Guinean territory, and have caused additional security problems, especially when innocent civilians have been killed or hurt as a side effect of the fighting. Following a recent upsurge in fighting between forces of the Government of Senegal and MDFC rebels in Casamance Province, Bissau Guinean forces reinforced their border presence to prevent the possible retreat of MFDC rebels into Guinea-Bissau.

13. The ongoing MFDC rebel military operations, including the mines reportedly planted by them in the border area, not only heighten insecurity but have virtually paralysed economic and social activities along the border. The presence of over 3,000 refugees from Casamance, some of whom are alleged to have links with the rebels, complicates the situation further. At the request of the Government, the regional office for West and Central Africa of the Office of the United Nations High Commissioner for Refugees (UNHCR) dispatched a mission to Guinea-Bissau from 16 to 25 April to assess the refugee situation along the country’s border with the Senegalese province of Casamance. The mission examined, in particular, possibilities of and constraints to the resettlement of the refugees away from the border or for their voluntary return to Senegal. Following the mission’s determination of the logistical, financial and other requirements of possible refugee relocation, the Governments concerned are currently studying the next step to be taken.

14. Largely owing to border security concerns, the restructuring of the armed forces, although agreed to in principle, has not advanced significantly in practice. The process has also been affected by lingering tensions within the military relating to the detention of several military officers over allegations of complicity in the November 2000 failed coup attempt, the non-payment of salaries and divisions in the armed forces along party, religious and ethnic lines. The critical lack of financial resources for retraining of the armed forces to transform them into a professional republican army is also blamed for the slow pace of the military restructuring process.

15. The tensions within the armed forces described above have also contributed to delays in the implementation of the Government’s Programme of Demobilization, Reinsertion and Reintegration, which the World Bank estimates might require approximately $17 million. Some progress has nevertheless been made, facilitated by continued technical and financial assistance of the Bank. As a result, the pilot exercise for the Programme was completed on 8 May, when 571 former combatants were demobilized in a public ceremony and were assured that they would be reintegrated into civilian life.

16. In another positive development in the security domain, on 5 June, border guards who had been deployed to combat duty in 1998 to support the Government’s armed forces during the civil war returned to their regular guard duties under the command of the Ministry of Internal Administration. The Minister of Defence, for his part, welcomed this development as an important step in the reorganization of the armed forces.

17. With regard to the demining programme, ongoing activities have focused on the most heavily populated areas. By 31 May, mine-clearing operations led by HUMAID, an international NGO, and facilitated by UNOGBIS had resulted in the destruction of over 2,000 mines. It is estimated that $2 million would be needed to remove the estimated 5,000 mines remaining in and around the capital, Bissau.

18. The persistent volatility of the political and military situation in Guinea-Bissau is both a cause and a consequence of the country’s economic deterioration. As rampant poverty deepens, social tensions have increased, contributing to a political and security climate of instability which discourages investment. In addition, public sector employees, suffering from many months of unpaid wages, have organized demonstrations and labour strikes which have further decreased economic productivity and increased unemployment.

19. Against that background of limited economic output and unstable prices for cashew, the country’s principal source of revenue, Guinea-Bissau is suffering from a sever liquidity crisis, with foreign assistance currently accounting for some 80 per cent of the national budget of about 95 billion CFA francs.

20. As the economy has stagnated, concern is growing that masses of the unemployed or underemployed, especially young people, could increasingly be drawn into illegal arms and drug trafficking as well as prostitution, further fuelling insecurity and the risk of the spread of HIV/AIDS.

21. The United Nations country team has been assisting the Government in addressing some of these potentially explosive socio-economic challenges. The United Nations Development Programme (UNDP), on 17 April, signed a three-year financial assistance agreement in the amount of $3.7 million to support the Government’s governance programme which, if implemented, should provide a catalytic boost to the peace-building process. The United Nations Children’s Fund (UNICEF), the World Health Organization (WHO) and the United Nations Population Fund (UNFPA) have launched a comprehensive national programme to combat HIV/AIDS. In an initiative designed to promote vocational training and small businesses, the Food and Agriculture Organization of the United Nations (FAO), on 15 May, signed an agreement with the Government for the training of Bissau Guineans in laboratory science, fish processing and management techniques in the fishery industry.

22. To evaluate overall economic performance, including the state of the structural adjustment programme initiated in 2000, a joint mission of the World Bank and the International Monetary Fund visited Guinea-Bissau at the end of May. As a result, the Bretton Woods institutions have postponed until November 2001 their final periodic evaluation of the Government’s performance targets which, as the mission’s initial assessment concluded, the Government had not met. The mission also called for greater transparency in the disbursement of government funds.

23. UNOGBIS has continued to promote respect for human rights and the rule of law in Guinea-Bissau. During the period under review, UNOGBIS focused on supporting, as appropriate, the Government’s efforts to ensure due process with respect to the 169 persons originally detained on suspicion of complicity in the November 2000 failed coup attempt. Much progress has been made to that end, and by 13 June, only 11 officers remained in detention, the rest having been provisionally released pending trial. As government officials continue efforts to ameliorate detention conditions, a United Nations doctor in Bissau is providing detainees with basic health care, while UNICEF is making available medicines and potable water.

24. To help strengthen the operational capacity of the legislature and the judiciary as pivotal institutions in the process of democratic consolidation, the Government of the United States of America is funding, through its Agency for International Development (USAID), a government programme developed in cooperation with UNOGBIS and UNDP to train Bissau Guinean legislators and judicial personnel and to provide logistical support to the National Assembly, the Supreme Court and the Office of the Attorney-General.

25. Following reports in late May that some Casamance refugees had allegedly been forcibly returned to Senegal, representatives of the Government, UNOGBIS and UNHCR visited the border area on 30 May. They found that, as a result of armed skirmishes between MFDC rebels and Bissau Guinean forces on Bissau Guinean territory, 11 houses in a village where the refugees lived had been burned, forcing them to flee. According to UNHCR, 53 of the refugees have voluntarily returned to Senegal, while 36 others have chosen to remain in Guinea-Bissau.

26. As in any similar situation, post-conflict peace-building is a sensitive and painstaking process. Rebuilding societies torn apart by war, including narrowing differences among different segments of the population and moving towards genuine national reconciliation, is bound to take time. Such an undertaking is even more arduous in an environment such as Guinea-Bissau whose long history of armed struggle has left a legacy of weapons circulating widely in society, amidst rampant poverty. Developments during the period under review have confirmed, regrettably, that efforts at healing and reconstructing the country remain difficult.

27. In previous reports I have underscored the need for financial support for Guinea-Bissau’s newly restored democratic institutions in order to enable them to function effectively and take root. Significant contributions have been made to that end which have helped advance efforts to consolidate the country’s peace-building agenda. As the present report indicates, however, much more remains to be done. Critical measures that are required, for instance, to restructure the armed forces, to achieve effective demobilization and reintegration and to ensure the smooth functioning of national institutions of government continue to lag owing to the lack of the necessary financial and logistical resources. As a result, essential institutions are unable to function as efficiently as possible, contributing to a climate of frustration and tension which, in turn, lowers productivity and discourages economic investment.

28. The fact that Guinea-Bissau continues to depend heavily on foreign assistance to meet state expenditures is a strong indication of the enduring nature of the difficulties the country faces, in both the immediate and the medium terms. Overcoming these challenges will remain a collective endeavour, involving the renewed commitment of the international community to provide assistance along with the demonstration of the necessary political will by the Government and people of Guinea-Bissau themselves to do what is needed to move their country forward. Clearly, not everything can be achieved quickly or at the same time. As the country’s democratization process advances, the transparent management of state affairs should be able to show that the burden is being borne by all sectors of society.

29. It is important to keep the national interest above all other considerations, even as political differences among the various institutions of government reflect the pluralism of a country’s democracy. The recent prolonged stand-off between the executive and the legislature over the confirmation of the President’s choice of Prime Minister and over the approval of the Government’s budget and programme of work often appeared to overshadow the more urgent needs the country faces. I am relieved that this impasse was overcome and that the leaders of the country have once again begun to focus on the national challenges at hand. If international support is to be effective on the ground, it needs to have, at all times, an effective and credible national partner leading the way.

30. I commend the efforts of President Kumba Yala and his Government to promote constructive and cooperative relations in the subregion and especially with Guinea-Bissau’s immediate neighbours. Such improvements can help advance cross-border trade and security; conversely, without improved ties it would be difficult for Guinea-Bissau and its neighbours to carry on normal trade and other relations which are in the mutual interest of all the States and peoples concerned.

31. The challenges are many and the efforts sometimes frustrating, but the international community must continue to assist Guinea-Bissau. I therefore express my appreciation to those Member States and international organizations, including the World Bank and the International Monetary Fund, that have remained supportive of the Government’s reconstruction efforts, and have also contributed to the trust fund set up to finance the peace-building activities being undertaken by UNOGBIS. I commend in particular Nigeria’s generous contribution to help facilitate the restructuring of the army, one of the critical sectors of the ongoing peace-building process.

32. Finally, I wish to pay tribute to my Representative, Samuel C. Nana-Sinkam, and to the staff of the entire United Nations country team for their unflinching dedication to the cause of peace and stability in Guinea-Bissau. I also wish to recognize the important contributions of members of the United Nations country team on the ground in Guinea-Bissau and urge them and all other partners to remain engaged.