EXECUTIVE OUTCOMES, the South African mercenary

company involved in conflicts from Sierra Leone to Papua New

Guinea, is to close at the end of the year.

The company, which was the leader of the new generation of

mercenaries who have replaced the old "dogs of war" fatigues

with business suits, said yesterday that governments in Africa,

the main source of business, had made important strides in

establishing law and order.

The owner of Executive Outcomes, Nico Palm, said: "African

countries are busy working out solutions in Africa. Let's give

them a chance. I am going to get involved in other things which

keep me out of the limelight. I am going to close the company

and I will not be involved in the security business."

But well-placed insiders in the shadowy world of military

consultancy said the main reason for closing was that major

military contracts were drying up because of the controversy

surrounding companies such as Executive Outcomes and

Britain's Sandline International.

The South African government earlier this year passed

anti-mercenary legislation designed to regulate and curb

military freelancers. Executive Outcomes was licensed but the

new rules may have contributed to an unfavourable climate for

the company.

Executive Outcomes was founded in the dying days of white

minority rule by officers from special forces units. It helped the

Angolan government to train forces for the war against the rebel

Unita movement, and assisted in the restoration of President

Ahmad Tejan Kabbah to power in Sierra Leone in May after he

had been deposed in a coup.

Its Internet website was filled with the reassuring language of

the corporate world. It explained that Executive Outcomes

provided "a highly professional and confidential military

advisory service to legitimate governments". Its training

packages included anything from paramilitary services to air

warfare and "peacekeeping (persuasion) services". It supported

"reconstruction and development programmes for better quality

of life and greater opportunities for individuals and

communities".

But Executive Outcomes had also been at the centre of

accusations that private security companies were "re-colonising"

Africa by securing mining concessions, through a network of

subsidiary and front companies, in return for its services. In

recent times, it has been recruited for the mundane task of

protecting farms in South Africa from rustlers.

"There has been a negative attitude towards companies such as

Executive Outcomes, which is affecting their ability to find

business," said one executive of a security company, "Even

countries that cannot find military help from other countries are

sensitive about using Executive Outcomes. This is a warning

bell for other companies. The world will lose an option to solve

international crises. Governments will have to resort once again

to old-style, unregulated mercenaries."

But Jakkie Cilliers, executive director of the Institute of

Security Studies in Johannesburg, said the closure of Executive

Outcomes would change little because its activities were spread

through a large network of security companies, many of them

outside South Africa.

DAILY TELEGRAPH 11 DEC 1998