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THE WHITE HOUSE WASHINGTON CONPIDENTIAL WITH SECRET ATTACHMENT July 30, 1985 SYSTEM II 90723 National Security Study Directive 7-85 U.S. Policy Toward the Southwest Indian Ocean (U) Introduction The President has directed a review of United States policy toward the Southwest Indian Ocean (SWIO) . (e) The SWIO includes four island governments (Madagascar, Seychelles, Comoros, Mauritius) , a French Island Department (Reunion), and the African littoral countries of Kenya, Tanzania, and Mozambique. (0) There has never been a comprehensive, inter-agency review of the SWIO, U.S. interests and objectives there, heightened Soviet activity, and implications for U.S. policy. Though strategic interest of both the U.S. and the Soviet Union in the SWIO is modest, it is an important region as a zone of transit for commerce and military purposes and contingencies, and because of its mineral resources. In the past few years there has been a moderate increase of Soviet activity in the region, primarily in its willingness to provide military equipment and training to local armed forces and security services in an attempt to gain greater political leverage and influence in some countries. 19A Despite these increased Soviet efforts, however, there is evidence of growing opportunities for the U.S. in effectively countering Soviet programs and to build upon relations with SWIO states. Most, if not all, SWIO leaders are disappointed in the economic aid provided by the Soviets. Some are also dissatis- fied with Soviet military assistance. Despite this uneven Soviet performance, however, in some cases low-cost Soviet military and/or security assistance may have unduly influenced the political decisions of local leaders, thereby offsetting our advantages gained by aid and trade. let The essential questions to study are whether present U.S. policies are broad or flexible enough to exploit these opportunities, if modest increases in various forms of U.S. assistance are called for and consistent with U.S. goals and interests, or whether present U.S. policies and resource mix for the region are appropriate. (s) on 616196 of ED 1295 CONFIDENTIAL WITH National Security Council SECRET ATTACHMENT -88- 712 DECLASSIFY ON: OADR OPY 1H OF 12 COPIES