[dehai-news] (Reuters): SPECIAL REPORT-Southern Sudan: oil boom to bust-up?


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From: Berhane Habtemariam (Berhane.Habtemariam@gmx.de)
Date: Fri Apr 09 2010 - 06:49:44 EDT


SPECIAL REPORT-Southern Sudan: oil boom to bust-up?

Fri Apr 9, 2010 5:07am GMT

 

* Mounting insecurity ahead of poll fuels tribal strife

* Chinese oil producers "preparing for the worst"

* Even with secession, tribal fights may multiply

By Ed Cropley

TEREKEKA, Sudan, April 9 (Reuters) - With southern Sudan stumbling towards
independence next year, the Chinese oil workers in Africa's biggest country
are bracing for trouble. For southern villagers like Maria Jande, trouble is
already here.

Dinka tribesmen briefly abducted Jande, her family and more than a dozen
other women and children in a raid last month that destroyed crops and food
stores and killed five men from her Mundari tribe.

It's a far cry from the hopes that sprung up in southern Sudan five years
ago, when a peace deal with the Arab-dominated government in Khartoum in
Sudan's north promised to end a generation of conflict.

Elections this month and a secession referendum by January were meant to
secure a stable future for the south after 22 years of civil war and the
loss of two million lives.

Instead, age-old rivalries between the south's dozens of different tribes
are resurfacing.

"If we stay here, we'll die of hunger. There's no food," Jande said,
standing beside a pot of rancid goat meat cooking beneath a mango tree in
Terekeka, a tiny town 100 km (60 miles) north of southern Sudan's capital,
Juba.

As she spoke, her five-year-old twins hid in the folds of her tattered brown
skirt, which would be scant protection from the annual rains and
malaria-carrying mosquitos due in force within days.

A host of foreign governments including the United States, Kenya, Uganda and
Britain backed Sudan's 2005 Comprehensive Peace Agreement (CPA) which gave
the south autonomy, a 50-50 share of oil revenues from wells within its
borders and a route to independence via referendum by January 2011.

Mutual distrust and vitriol between Khartoum and Juba in the run-up to the
April 11-13 elections mean the plebiscite is not assured: if it does proceed
the south is almost sure to split and declare itself an independent state
within six months.

So the deeply impoverished region's outlook is far from clear.

In the worst-case scenario, the hostility between north and south that has
riven Sudan since before its independence from Britain in 1956 will boil
over once again, rekindling a civil war that would destabilise east Africa
and halt oil output from the sub-Saharan region's third-biggest producer.

Or the south could negotiate -- as the United States is hoping -- a "civil
divorce, not a civil war" with Khartoum, securing billions of dollars in oil
revenues that it can use to drag itself out of its war-induced time-warp.

Under this view, a flood of foreign investment should ensue, developing
hoped-for oil reserves across the region and giving birth to
state-of-the-art farms and fisheries fed by the waters of the upper Nile and
its tributaries.

In their more fanciful moments, southern ministers even talk of droves of
foreign tourists flying in to witness wild animal migrations said to rival
those in Kenya's Masai Mara.

ARMS FLOWS

History suggests optimists in southern Sudan, a region nearly as big as
Texas and with a population estimated at anywhere between 8 and 13 million
people, are more likely to be wrong than right. A return to war is not out
of the question.

In the five years since the peace accord, the bulk of oil money accruing to
the south -- more than $2 billion a year -- has gone on pay for civil
servants and the Sudan People's Liberation Army (SPLA), the southern rebel
movement that has morphed into its government.

But the SPLA, whose soldiers rescued Jande and her family from her Dinka
captors, has also spent at least some of the cash re-arming, according to
the Small Arms Survey, a global arms trade watchdog.

Citing satellite images and reports of arms shipments from Ukraine via
Kenya, the Survey estimates the south bought more than 100 Soviet-era battle
tanks, anti-aircraft guns, rocket launchers and 10,000 AK-47 assault rifles
from 2007 to 2009.

Not only do such flows break an agreed weapons embargo, they also ensure
that any conflict would have implications beyond southern Sudan's borders.

"The southern Sudanese arms acquisitions are rooted in civil war-era
political alliances, with regional allies, including Ethiopia and Kenya,
acting as conduits for arms supplies from their own stocks or acquired on
the international market," the Survey said.

Alongside reported arms purchases by the north from China, Iran and Belarus,
this has set nerves jangling at the Chinese, Indian and Malaysian oil firms
running the south's oil fields, which all lie close to the unofficial
border.

In the event of conflict, they would have little option but to halt
production from a country that was China's fourth or fifth largest supplier
of crude oil for much of 2009.

State-owned China National Petroleum Corporation (CNPC), the largest foreign
player with a roughly 40 percent stake in Sudan's oil industry, is "hoping
for the best but preparing for the worst", according to an industry source
familiar with Chinese operations in Sudan.

"An independence vote for the south is likely to lead to clashes between the
north and south, a worst-case scenario that we do not wish to see," said the
source, speaking on condition of anonymity.

CNPC would have no option but to "halt production and evacuate our 2,000
people in Khartoum and the oil-fields," the source added.

WANING APPETITE FOR WAR

However, analysts say neither north nor south have much to gain from a
resumption of hostilities: the disruption of oil exports would cut a cash
lifeline that both governments need, now and in the foreseeable future.

"As much as oil has been a major source of conflict in the past, it also
potentially represents the single greatest disincentive to renewed conflict
if the parties can agree on wealth-sharing," said Zachary Vertin, a Sudan
analyst for the International Crisis Group in Nairobi.

Southern oil accounts for the lion's share of Sudan's total output, although
the precise proportion depends on the final demarcation of a north-south
border in areas such as Abyei, which was too sensitive to be included in the
2005 pact.

However, more importantly for the south, all its oil goes by pipeline
through the north to Port Sudan on the Red Sea. This means that if it wants
to, Khartoum can cut off a revenue stream that accounts for 98 percent of
Juba's budget.

In that event SPLA soldiers would quickly find themselves without pay,
suggesting the south's generals would struggle to mobilise large numbers of
troops.

For the north, the prospect of disrupted or no production is almost as
alarming, given that oil currently accounts for 45 percent of Sudan's
national budget.

As southern Presidential Affairs Minister Luka Biong Deng put it, both sides
know what they stand to lose.

"Peace is our common objective because nobody will benefit from going back
to war or seeing either party collapsing," he told Reuters.

The United States has broadly backed the south, mainly due to its dislike
for Sudanese President Omar Hassan al-Bashir, wanted by the International
Criminal Court for crimes against humanity allegedly committed in the
western region of Darfur.

But analysts say Washington will be loathe to take sides in a fiendishly
complex conflict in the heart of Africa, and is more likely to focus on
avoiding a new north-south war and keeping an independent south in one piece
and on its feet.

"I would guess that the preference for the U.S. government all along is the
unity of Sudan," former U.S. ambassador to Ethiopia David Shinn told
Reuters.

"But you have to make plans for a divided Sudan -- and then just hope that
it doesn't divide into more than two parts."

C Thomson Reuters 2010 All rights reserved

 

In southern Sudan, for the money

Fri Apr 9, 2010 5:08am GMT

  

(This complements a special report ahead of southern Sudan elections:
[ID:LDE62S0O5])

By Ed Cropley

JUBA, Sudan, April 9 (Reuters) - The only thing that's cheap in southern
Sudan is life.

One of the world's poorest regions, where four out of five people are
illiterate and one in five children fails to make it to their fifth
birthday, the south's economy has been turned on its head since the end of a
22-year civil war in 2005.

A flood of foreign aid workers and more than $2 billion a year in oil
revenues under a peace deal with the central government in Khartoum has
transformed the south into one of the most expensive corners of Africa.

As homeless children sift through piles of garbage lining the streets of the
south's scruffy capital, Juba, a single supermarket caters to the tastes of
its new elite, most of them former guerrillas from the Sudan People's
Liberation Army.

With everything trucked in from neighbouring Kenya on shattering dirt roads,
or floated down the Nile from Uganda, these tastes come at a price. Southern
Sudan, a region the size of Texas, has just 50 km of paved roads.

A box of Kelloggs Rice Krispies costs 24 Sudanese pounds ($9.20). A litre
bottle of Johnnie Walker Blue Label is nearly $300.

Nobody knows how many people live in the city, although some say its
population has trebled in the last five years under the weight of tens of
thousands Kenyans and Ugandans out to make a quick buck.

"Earning $100 is difficult in Kenya. Here it's easy," said Amos Njay, a
Nairobi taxi driver hoping a year in Juba will set him up in a trucking
business.

Africans are not the only ones with an eye on the cash.

Foreign aid workers, holed up behind barbed-wire fences and armed guards in
semi-permanent tented camps on the banks of the Nile, boast of earning
$10,000 a month tax-free and with all their living expenses taken care of.

"You know what they say: in places like this you only get missionaries,
mercenaries and misfits. Me? Sure, I'm just here for the money," said one
U.S. aid contractor knocking back a cold beer in a bar on the banks of the
Nile.

Other drinkers ranged from dapper pro-democracy activists from the U.S.
International Republican Institute to former soldiers whose lives are spent
treading in the heels of conflict across the globe, cleaning up mines and
unexploded bombs.

Even for the most battle-hardened, the legacy of a conflict that claimed 2
million lives can be depressing.

"I don't drink the local beer. It's just not strong enough. It doesn't have
the effect," said one veteran of de-mining operations in Laos and
Afghanistan, quaffing a bottle of imported Kenyan lager.

"I really want to get back to Afghanistan. It's a beautiful place." (Editing
by Sara Ledwith)

C Thomson Reuters 2010 All rights reserved

 

FACTBOX: Potential flashpoints in Sudan elections

Fri Apr 9, 2010 9:24am GMT

  

KHARTOUM, April 9 (Reuters) - Tensions are mounting in the build-up to
Sudan's first multiparty elections in 24 years, due to start on Sunday.

The two main rivals to incumbent president Omar Hassan al-Bashir have
boycotted the polls and the political controversy around the elections risks
heightening existing conflicts across the oil-producing state.

Here are some potential flashpoints of violence.

POLLING FRUSTRATION

Sudan's inexperienced voters will face one of the most complex elections on
record, using three different voting systems. In the north voters will have
eight different ballot papers and in the south they will have 12 for
different presidential, legislative and gubernatorial polls.

Voters, many of whom are illiterate, are also likely to face long queues,
poorly trained officials, incomplete voters' lists, a heavy security
presence and a shortage of ballot papers.

These factors, combined with suspicions of government fraud, confusion over
opposition boycotts and midday temperatures topping 45 degrees centigrade in
some areas, could boil over.

"There's been very little voter education in some areas and in many areas
none," Toby Madut of the southern Sudan African National Union party told
Reuters. "If people feel the results are not right they will react. There
will be violence because of this confusion."

DARFUR

Darfur's main rebel groups have rejected the elections, calling them a farce
while the region's seven-year conflict continues and accusing the government
of fraud. One faction has threatened to treat polling officials as enemy
soldiers.

There is a risk of unrest among Darfur's politicised refugees, many of whom
are boycotting the vote for the same reasons. Observers say registration in
some camps is less than 10 percent.

Outside the camps, observers say registration officials have failed to reach
many remote territories, including the central Jabel Marra area,
disenfanchising their scattered populations.

So far there have been no reports of violence directly related to the
elections. Khartoum appears to be holding larger rebel groups in check,
either through talks or confrontation.

Authorities have tightened security around polling centres in the main
cities and settlements.

OPPOSITION PROTESTS

Sudanese security forces fired tear gas and beat protesters when opposition
parties sent supporters onto the streets of Khartoum in December to push for
democratic reforms.

Those parties, now largely boycotting the elections, may protest again. "We
are not going to take these elections lying down," an official of the
opposition Umma party told Reuters.

But insiders said many grassroots activists opposed the boycotts.

In the north-south border states of Blue Nile and South Kordofan, largely
exempted from the main opposition boycott, competition is likely to be
fierce and any allegations of fraud there could spark protests.

ABYEI AND UNITY STATE

Central oil-producing Abyei is one of the most politically charged areas of
Sudan in the run-up to the elections and a 2011 referendum on whether it
should join south Sudan.

The Permanent Court of Arbitration in The Hague re-drew its borders in July
in an effort to resolve a festering north-south row over the region's
boundaries.

But the decision, which put Abyei town and fertile grazing land firmly
inside the borders of Abyei, has been rejected by the area's often
heavily-armed Misseriya nomads.

They fear they will lose access to pasture if Abyei's settled Dinka
population votes to join the south, and south Sudan then votes to split away
as a separate country in a second, simultaneous referendum.

There have been reports of clashes. The Misseriya's annual migration with
their animals over the border into the south coincides with the elections,
stoking tensions.

SOUTHERN TRIBAL VIOLENCE

At least 2,500 people died in ethnic violence in 2009 and this year in
Jonglei and other remote states in south Sudan.

Intertribal fighting over cattle rustling and grazing has long plagued the
underdeveloped region. But the scale of the 2009 attacks shocked many.

Some southern leaders blamed their former civil war foes in Khartoum of
arming rival militias to destabilise the south before the elections and
referendum. Others said southern leaders were arming fellow tribesmen to
build up support.

The United Nations says candidates have so far been able to move around
their constituencies relatively undisturbed and elections materials have
been distributed. (Reporting by Andrew Heavens and Skye Wheeler; editing by
Andrew Roche)

C Thomson Reuters 2010 All rights reserved

 

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