U.S. says Mali coup puts aid at risk, but moves carefully

WASHINGTON Fri Mar 23, 2012 5:09pm EDT

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WASHINGTON (Reuters) - The United States warned Mali's coup plotters on Friday that they were risking U.S. economic aid but stopped short of joining the European Union and immediately suspending assistance to a key African partner in the fight against Islamic extremism.

President Barack Obama's administration has denounced this week's attempted coup by mutinous Mali soldiers, and called for the immediate return to civilian rule.

But Washington has moved cautiously, reflecting Mali's important role in U.S. efforts to fight militant groups, including some associated with al Qaeda.

State Department spokeswoman Victoria Nuland said the rebels' actions could force the United States to suspend some of its aid to Mali, which runs to about $140 million a year.

"A little more than half of that is humanitarian aid of food, etc, so that would not be affected. But if the situation is not resolved democratically, the remaining portion of that aid could very seriously be affected," Nuland told a news briefing.

The European Commission said it was suspending non-humanitarian aid to Mali, while the World Bank and the African Development bank have also suspended project financing in the west African country.

The African Union on Friday suspended Mali's membership.

The United States has moved quickly in the past to freeze aid to coup-hit African countries, hoping to buttress democratic gains and discourage the violent politics of force that has long dominated the continent.

But U.S. officials have reacted cautiously to the Mali coup, saying it was too early to judge the final outcome of Thursday's coup attempt against President Amadou Toumani Toure and voicing hope that an initiative by the regional ECOWAS block of countries could resolve the situation.

"We have to see what ECOWAS evaluates when it gets there in terms of what's needed. But in terms of our assistance, we're making absolutely clear what's at risk here if democracy is not restored," Nuland said.

On Thursday the Millennium Challenge Corporation, an independent U.S. foreign aid agency that assists countries with good governance, said it was suspending work on its $461 million compact to expand agricultural land and improve the country's international airport.

GRIEVANCES AND SECURITY

The coup leaders have sought to capitalize on popular dissatisfaction with Toure's handling of a rebellion by northern nomads, and Nuland said the United States recognized that elements in Mali's military had grievances that should be addressed

"We need the military to be able to get back to its job, which is to provide security in Mali," she said, adding that the U.S. Embassy in Bamako was attempting to get in contact with the coup leaders.

Mali, one of the poorest countries in the world, is nevertheless seen in Washington as an important regional ally in the effort to crack down on al Qaeda-associated Islamic militants spreading southward from the Sahara.

As a part of the Trans-Sahara Counter Terrorism Partnership, Mali's military has received U.S. equipment and training and Nuland said that cooperation continued for now.

Mali, which faces a Tuareg rebellion in the north bolstered by arms and fighters from Libya, has been accused by regional neighbors of doing too little to combat Islamist militants.

Africa expert Jennifer Cooke at the Center for Strategic and International Studies said Mali was nevertheless an integral part of the battle against Al Qaeda's north African wing.

"The rebellion in the north has distracted them, and now of course they are distracted by everything," Cooke said. "But they are a key partner, and if you don't have Mali with you in the regional response it's a huge vacuum and a huge gap."

(Editing by Christopher Wilson)

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