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[Dehai-WN] Africa-Confidential.com: The South goes for sovereignty

From: Berhane Habtemariam <Berhane.Habtemariam_at_gmx.de_at_dehai.org>
Date: Tue, 7 Feb 2012 00:58:42 +0100

eignty> The South goes for sovereignty

6th February 2012

Juba turns off the oil and turns up the pressure in its fraught negotiations
with Khartoum over oil, cash, security and citizenship

Few outside the Juba government had expected it to start shutting down oil
production on 22 January. Warnings from the Government of South Sudan had
been widely seen as brinkmanship. The National Congress Party (NCP), plus
African Union, Chinese and Western mediators, had apparently forgotten the
capacity for decisiveness of the Sudan People’s Liberation Movement (SPLM),
which helped it to win Independence for the South. The talks should resume
on 10 February but no one expects speedy agreement. This was clear when the
AU representative, South African ex-President
<http://www.africa-confidential.com/whos-who-profile/id/2/Thabo_Mbeki> Thabo
Mbeki, announced on 31 January that they would cover several outstanding
issues from the 2005 Comprehensive Peace Agreement since ‘the interim
transitional period ends at the end of March’. This broadening of the agenda
is a tactical victory for the GOSS, which for the first time has the NCP
literally over a barrel.

This is costing Khartoum dear but it also knows that Juba loses 98% of
revenue, with no clear alternative. The NCP’s strength is military and it is
beating the war drums. Second Vice-President El Haj Adam Yusuf said on 25
January that the army had surrounded SPLM-North rebels in Blue Nile and
South Kordofan and ‘Juba is not far’. Until November, he was senior in
Hassan Abdullah el Turabi’s Popular Congress Party and the NCP accused him
of conspiracy in 2007. His threat has hardened Southern resolve and
highlights the chasm between the two governments.

ipes_COL3.jpg> Oil pipelines proposed by Africa Infrastructure Consortium
Inc. (AIC)

‘This is not about oil, it’s about politics!’ one senior Northern
oppositionist told Africa Confidential. This goes even beyond the CPA’s
‘unfinished business’ to the heart of North-South relations on one hand and
relations between the regime and the Sudanese people, North and South, on
the other. ‘They [the NCP] have convinced themselves that the Independence
of the South is just a formality,’ the oppositionist said. Khartoum has
warned foreign journalists and rabidly anti-Southern propaganda has appeared
even in liberal media, such as Al Ayyam.

This all suggests two broad scenarios: the talks focus on technical and
financial issues and reach agreement, at least on oil; or they break down
and South Sudan seeks new outlets while Sudan’s economy nosedives. Either
way, a new Southern pipeline looks likely (see Box). The bigger unknown is
whether the NCP will apply its theoretical military superiority.

Who will blink first?
It doesn’t look as if the GOSS will blink first and much now depends on how
the NCP assesses the economic crisis and its political impact. It was
demanding up to US$38 a barrel from Juba in transit fees (the international
rate is $0.40-$1.00) and confiscated already loaded ships at Port Sudan. It
did not seem to be seeking compromise. President Salva Kiir Mayardit accused
it of ‘looting’ $815 mn. in Southern oil, some through a new, secret, spur
pipeline, and of underreporting output for years. As the talks ended, Juba
had offered $1.7 billion to Khartoum and transit fees of $0.63-0.69 a
barrel. Khartoum demanded $5.4 bn. cash and $3 a barrel.

What has really upset Southerners is that Khartoum has dealt with Juba in
the traditional way. President Omer Hassan Ahmed el Beshir called it ‘naive’
and Foreign Minister Ali Ahmed Kurti, ‘childish’. This is seen as a
calculated insult to the new sovereignty for which Southerners have paid so
dearly. ‘It’s OUR oil’, said one Southern analyst, ‘and it’s a separate
country. They can’t demand things.’

Interested governments follow the oil crisis and the war in Blue Nile and
Kordofan with anxiety and a steadfast public even-handedness which dismays
Southerners and also Northerners, who regularly ask why Libyans rebelling
against a brutal dictatorship get Western and Arab military support while
their Sudanese counterparts receive only criticism.

On the oil issue, the West is privately more sympathetic to the South, says
an SPLM source. However, this may not extend to bailing out a government
which has stopped pumping approximately 315,000 barrels per day. ‘Resolution
is imperative if the GOSS is to have the wherewithal to be a development
partner for the international community,’ warned a senior British official
this week.

Chinese puzzle
China, the biggest producer and purchaser of Sudanese oil, is also worried
and dispatched the head of the Communist Party Central Committee’s
International Department, Wang Jiarui, to Juba and Khartoum. ‘The shutdown
raises the political instability of an already challenging operating
environment, pushing Chinese and other Asian national oil companies
[Malaysian and Indian] to reconsider the importance of the two Sudans in
their expanding international portfolios,’ Luke Patey, co-editor of a new
book, Sudan Looks East, told AC. China gets only 5-6% of its oil from the
Sudans but fears sanctions on major supplier Iran.

The kidnapping of 25 Chinese workers in Egypt (now released) and the capture
of 29 others by the SPLM-N during fighting with Sudan’s army in South
Kordofan have triggered a public debate in China on workers’ protection, at
least abroad. The 25 were building a road near Talodi (to facilitate gold
mining by French interests, say Nuba sources). Beijing even deployed
Vice-Foreign Minister Xie Hangsheng on 31 January to reprimand Sudanese
Chargé Omer Eissa Ahmed. Meanwhile, though, China was trying to negotiate
the workers’ safe passage with the SPLM-N, thereby opening relations with
the opposition. The whole situation challenges Beijing’s huge new investment
in unstable countries and its policy of ‘non-interference’. China analyst
Daniel Large said: ‘It’s a very elastic policy – very hard to break.’
Beijing will not abandon Khartoum (it’s just promised a $200 million loan)
or Juba. Its biggest decision may be whether to help build a Southern

General Salva Kiir’s team knows that challenging Khartoum is the most
popular move it can make. People came out on the streets nationwide to
support the oil shutdown but there is also concern about what comes next.
Hopes of health and education remain high.

This was no knee-jerk shutdown, say insiders, and the GOSS has long planned
for the worst. Cabinet Affairs Minister Deng Alor Kuol spoke of a five-year
cushion and other sources talk of a sovereign wealth fund banked in Kenya
and Uganda. One key man in the Ethiopia talks has been Sayed Mohamed el
Hassan el Khatib, an NCP trusty, ex-London diplomat and CPA negotiator. He
also heads the NCP’s Centre for Strategic Studies: some rethinking may be
required there as it seems Khartoum underestimated GOSS strategising. As
both parties prepare for the next bout of talks, Juba faces the tough task
of wresting substantive concessions from Khartoum’s veteran tacticians.
There may be a messy compromise but that’s far from guaranteed.


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Received on Mon Feb 06 2012 - 18:59:52 EST
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