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Sudan/South Sudan: A Lose-Lose Scenario
Jan 30, 2012 (120130)
(Reposted from sources cited below)
Sudan and South Sudan seem to have entered a "lose-lose"
scenario, precipitated by failure to agree on payments for
transport of oil from fields in South Sudan through the
pipeline in the north to the Red Sea. Despite African Union
mediation and pressure for compromise not only from Africa
but also from the United Nations, China, and the United
States, South Sudan has closed the oil fields, with likely
disastrous economic and humanitarian consequences for both
Oil is only one of the points of dispute between the two
recently separated countries, which also include Sudan's
brutal suppression of opposition in provinces adjacent to
South Sudan, the status of Southerners still living in the
North, and the disputed status of Abyei. On these issues,
human rights groups fault principally the Sudanese regime in
Khartoum. On oil, however, compromise on division of
revenues seems to be the only option to avoid the loss of
the major income producer for both countries. Even if the
ensuing downward spiral does not result in renewed open
warfare, it is hard to see how either party can gain from
the current impasse.
This AfricaFocus Bulletin contains a short op-ed commentary
by Alex de Waal, an adviser to the African Union mediation
team on Sudan, and excerpts from the transcript of a
teleconference with Princeton Lyman, the U.S. special envoy
on Sudan. Both reflect the African and international
consensus urging both sides to compromise.
For an alternative point of view, placing exclusive blame on
the Khartoum regime, see Eric Reeves, "Oil Revenues
Controversy," Jan 24, 2012 http://tinyurl.com/6wos2ks
A sampling of recent news articles on the oil dispute
Reuters, "Sudan frees South Sudan's oil tankers; row
continues," Jan 30, 2012
"African Union Urges Sudan and South Sudan to Reverse
Unilateral Actions," Jan 23, 2012
Reuters, "China Urges Restraint in Sudan Oil Transit
Dispute," Jan 21, 2012
For updated news and analysis on Sudan and South Sudan,
For previous AfricaFocus Bulletins on Sudan and South Sudan
visit http://www.africafocus.org/country/sudan.php and
Visitors to the AfricaFocus website using smartphones and
tablets, many of them from African countries, have increased
significantly over the last year, and now represent some 4%
of website visits. To further facilitate such access,
there is now a section of the site particularly adapted for
mobile access: visit
Meanwhile, a new report "How Africa Tweets," from a Nairobi-
based communications research company, notes wthat Twitter
use is rapidly increasing in Africa. The top countries are South Africa, Kenya, Nigeria, Egypt, and Morocco. See
++++++++++++++++++++++end editor's note+++++++++++++++++
South Sudan's Doomsday Machine
By Alex de Waal
January 24, 2012
http://www.nytimes.com / direct URL:
Alex de Waal is the executive director of the World Peace
South Sudan was born as an independent nation on July 9,
2011, with good will and a bounty. Three hundred and fifty
thousand barrels of oil per day provided the government with
$1,000 per year for each of its 8 million citizens.
But the only pipeline to market runs through northern Sudan,
giving the government in Khartoum control over South Sudan's
economic artery. And on independence day there was no
agreement on the terms of pipeline use.
When Sudan was still one country, 50 percent of the revenue
from southern oil went to the central treasury, comprising
40 percent of its budget. After July 9, Khartoum received
nothing - not even a transit fee. International promises of
debt relief and lifting economic sanctions, to fill a part
of the budget gap, came to nothing. Continued negotiations -
convened by the African Union High-Level Implementation
Panel on Sudan, which is headed by former President Thabo
Mbeki of South Africa and to which I am an adviser - have
failed to resolve the issue.
On Jan. 20, South Sudan announced the dramatic step of
shutting down oil production, with immediate effect. As oil
money comprises 97 percent of the South's budget, it seems a
suicidal step. The rationale is that for the last month,
Khartoum has been diverting the oil to its own refinery and
filling three tankers.
A year ago, President Omar al-Bashir congratulated his
southern counterpart, President Salva Kiir, on independence
and promised a new and peaceable chapter in the troubled
history of north-south relations. This quickly turned sour,
particularly with the outbreak of war in two areas of
northern Sudan - Southern Kordfan and Bue Nile - where
about half of the population is loyal to the former rebels
of the Sudan People's Liberation Movement, who are now the
government in the South. Although the northern branch of the
party supposedly split off, the South does not disguise its
solidarity with its former comrades in arms.
Khartoum's delegates to the just-concluding talks in Addis
Ababa complain bitterly. "Why should we allow Southern oil
to go free to market, when the money from its sales is used
to arm rebels who want to destroy us?" They follow it up
with a promise - we will reconcile our respective claims
after we agree on a transit fee that matches a third of the
The South counters, "Why do we allow our oil to be stolen
and the money used to buy weapons to kill our comrades in
arms? Khartoum has always wanted to control the South and
its readiness to strangle us financially shows that they
will never allow us to be truly free." The Southern
government in Juba has floated plans for a new pipeline
through Kenya. Optimistically, this may cost $3 billion to
$4 billion and take three years to build, but many Southern
leaders would rather leave their oil in the ground than
submit to Sudan's coercion.
So South Sudan has set off its economic doomsday machine.
The shutdown of wells is already beginning and within a week
the oil companies will begin flushing the pipeline with
water, so that the oil it contains doesn't jam and turn into
a 600-mile asphalt tube. After that, the best case would be
six months' work to reopen exports.
The South's lead negotiator, Pagan Amum, said he was at
peace with himself when he explained: "This is a matter of
respect. We may be poor but we will be free."
But South Sudan is a fragile state, as the recent
interethnic killings in the Jonglei area show, and it will
need massive foreign aid to compensate for the lost $650
million per month.
A northern general remarked, "The shutdown will hurt us but
it will kill them." But Sudan cannot be stable if its
southern neighbor is in crisis.
Based on its principle that Sudan and South Sudan should be
two viable states, at peace and mutually supportive, the
African Union panel has proposed an agreement. This will
keep the oil flowing, stop the unilateral diversion of
southern oil by the north, and provide enough funds to
cushion the economic crisis in the north. China - the main
buyer of Sudanese oil - the United States and the United
Nations have endorsed the African Union's plan.
President Bashir and President Kiir are due to meet in Addis
Ababa on Friday. This is the last chance, not only for the
two to snatch a deal on oil, but also to stop an escalation
into a wider north-south war. The two must step back from
Briefing on Issues of Ongoing Concern in Sudan and South
Ambassador Princeton Lyman
Special Envoy for Sudan
January 25, 2012
Ambassador Lyman: Thank you very much. Thank you all for
coming and being on the line. I wanted to just bring
everybody up to date on a number of issues that we're
following very closely related to Sudan and South Sudan. So
let me discuss them briefly and then happy to take your
questions about them.
One of the issues that we are extremely concerned about is
the situation in the states of Southern Kordofan and Blue
Nile. These are states in the Republic of Sudan; that is,
the North. But a conflict has been raging there since last
May, arising from issues never fully resolved in the civil
war because people in those states, particularly in the Nuba
Mountains, fought with the South. And though they remained
in the North, their issues were to be resolved in a process
called popular consultations. Those did not get finished and
a conflict broke out. A very serious armed conflict broke
out last year.
Now, what we are very concerned about right now is that
there are predictions of a major humanitarian crisis in
those areas, particularly Southern Kordofan. You know
there's this predictive mechanism called FEWS NET, the
Famine Early Warning System Network. They - if you go on
their website, you'll see they have produced two maps, one
the situation now - excuse me - and one predicting for
March. By March, they feel that a large number of people, a
quarter of a million or more, will be - will reach what they
call emergency status, which is one short of famine. And
this is very alarming to us.
We have strongly urged the Government of Sudan to allow
international humanitarian aid â that is, World Food
Program, UNICEF, et cetera â to come in, in all parts,
across lines of whoever's holding territory. They have
refused to do so. They don't want international involvement
in this area, which they think is an internal matter and a
conflict area. But we have been saying and saying to our
African partners that we just can't - the world can't stand
by and watch famine take place in an area, and know nothings
So we've been working very hard, leading up the Africa Union
meeting at the end of this month, to urge the Government of
Sudan to open up international access and to do so soon.
We're under a lot of pressure if that doesn't happen to look
at other alternatives, but they all contain serious risks in
doing so. So our preferred alternative - very far first
alternative - is for the Government of Sudan to do this. The
UN has made proposals to the government, but they haven't
been accepted yet.
The second issue that I would like to touch on is a -
ongoing negotiation and dispute between Sudan and South
Sudan over the distribution of oil revenues and financing.
You'll recall that after the secession of the South, 70
percent of the oil was in the South but all the
infrastructure for exporting it - pipelines, et cetera - are
in the North. So the two countries really are dependent on
each other in the oil sector. It was also understood that
when the North, now the Republic of Sudan, lost that much
revenue there would be a transitional financial arrangement
in which the South would ease that transition.
They've been negotiating and arguing over this for some
time. The negotiations reached a very serious point in the
last few weeks when the Republic of Sudan, in the North,
began to divert Southern oil from the pipeline and to block
ships with Southern oil from leaving the port, claiming this
is a way to collect transit fees that they claim the South
wasn't paying. And they imposed a fee of $32 a barrel, which
is quite high, for that.
After negotiations, which are still going underway, failed
to reach an agreement, South Sudan said, okay, we're going
to shut off the oil, we're going to start closing the wells,
and we'll suffer until we build a new pipeline through Kenya
but we just can't take this anymore; they're stealing our
It is a very bad situation, and both sides could get hurt
very, very badly. The African Union High-Level
Implementation Panel - this is the panel headed by Thabo
Mbeki and former president of Burundi Pierre Buyoya and
Nigerian former head of state General Abubakar - has been
running negotiations on this in Addis. They're working very
hard. They're very close to a proposal which should be able
to reconcile the different interests and come up with a
We're very concerned that this negotiation succeed and
before too much damage is done to the oil sector and the
infrastructure, that the South feels that they can stop
shutting off the production and go back to full production.
So this is a quite urgent matter on which we are working
The third area I want to touch on is the situation in
Jonglei. That's a state in South Sudan. You'll recall about
two weeks ago there was a major conflict between two ethnic
groups, the Lou Nuer and the Murle. There have been attacks
back and forth between these groups over cattle, kidnapping
of women and children, et cetera. And in this latest
incident, 6,000 or so young Nuer marched on the Murle to
regain the cattle, to regain the people who were kidnapped,
and we feared a major massacre.
Fortunately, with the help of UNMIS, et cetera, the Murle
were warned in the town of Pibor. Most of them left, and
after some skirmishing and some people getting killed,
perhaps several hundred, the young Nuer have started to go
back. But now the Murle are undertaking revenge attacks.
In the meanwhile, the people who fled Pibor are displaced
people in various towns, and we think more are in the bush.
So the UN, USAID, humanitarian NGOs are all working to try
and reach these people and get them humanitarian assistance.
This is a situation that demonstrates the tensions and
traditional and otherwise that exist in South Sudan that
have sort of - were set aside in the campaign for
independence and the successful independence July 9th but
now, coming to the surface, demonstrate how much the
Government of South Sudan must do to improve both its
security sector capabilities, but also its outreach to these
communities and conflict resolution and development programs
here and elsewhere in South Sudan.
So I wanted to touch on all three of those, because they are
all very serious situations on which we have been working
very heavily here and in the field and in our diplomacy,
both in Europe, the Arab world, Africa, et cetera. So let me
stop there and open it up. Happy to take your questions.
Moderator: We'll go ahead and take a few questions from here
in the room and then we'll turn it over to the callers. Does
anyone here in the room first have a question? Andy, go
Q: Yeah. On the issue of Blue Nile and Southern Kordofan and
the potential famine or food emergency, I'm wondering what
you can tell us about the contingency planning, should Sudan
continue to refuse access to aid groups. I understand that
there has been some discussion of unilateral aid operations.
Is that true? How is that possible without Sudanese
Government approval? And how advanced are those - is that
Ambassador Lyman: Well, we - right. We have said to the
government in Khartoum for some time that we are feeling a
lot of pressure if there's no international access to look
at ways in which assistance would be carried across the
border without their approval. But we know there are a lot
of risks to that. We know the government would be opposed to
it. We have to look at the possibility of it, but we've made
no decision to do that because it has a lot of
But at the same time, we're very worried about what happens
if they don't allow international assistance, so we continue
to press heavily for international accepted assistance by
the government even as we look with a good deal of
apprehension at what alternatives might be possible.
Q: And does the U.S. have an assessment of whether this
potential plan from the AU, from the Mbeki group, let's call
it, could actually work if some sort of resolution is
reached between now and next Tuesday?
Ambassador Lyman: I only have the general outlines of the
proposal. They're being presented today to the parties. But
my information is that this proposal will address the basic
concerns of the North and South; that is, how to assure that
there's enough oil for the refinery in the North, which is a
major concern of theirs, and a prospect of this transitional
assistance while recognizing that the South has a legitimate
claim about all this diverted oil and that has to be costed,
and that the fees for transit are - that there's a mutual
basis for determining those.
I haven't seen the details of the proposal. We think it's
going to address all these things, and we hope once it's on
the table that both sides will refrain from these kind of
Q: I've got another one. On the oil, on South Sudan's
decision to stop the oil production, in your view, how long
can this go on? Number one, do you have any position on
whether or not this was a wise bargaining move? Was this the
right thing for them to do? Did they have any other option?
And number two, how long can this go on before you start
having very serious issues with the infrastructure and that
it sort of really affects the viability of their finances?
Ambassador Lyman: I've heard mixed reaction - responses to
that question. There is some feeling that in just three and
a half days after they shut down the wells, you will get
into a situation which will be very costly and timeconsuming
to restore production. I've heard different
assessments of the impact on the pipeline and the
environmental damage, some predicting very serious damage
and costs. Others are saying less so. I don't have a firm
feeling, but there is a general feeling that it's going to
be very costly.
Is it a good tactic? I was just in South Africa, as you
know, Andy, and I was reminded that Nelson Mandela also
often had to take the country to the brink but never crossed
it, even in the most tense times. I think the Government of
South Sudan was outraged and angry and took the situation to
the brink, but I'm afraid in this they may be crossing over
and costing themselves in the long run when they have so
many development needs.
So I think I can understand the anger, I can understand the
response, but I'm very worried that they go over the brink
here and then have to pay a price that will hurt the people
of South Sudan for a long period of time.
Q: Well, both in this case with the oil fees and with the
fighting between traditional groups, does this suggest that
perhaps the new government isn't quite capable of dealing
with these very serious fundamental issues? And if it's not
fully capable, what can the U.S. do to support them to
prevent things from going over the edge?
Ambassador Lyman: I think the Government of South Sudan is
faced with a number of challenges and still has a relatively
thin layer of trained civil servants, professionalized
military command and control systems, et cetera. And the
country was so devastated by the civil war that there is
just basic, basic development needs all throughout the
So I think the challenges are very great, and they must be
able to dedicate their efforts, time, and resources to those
demands. And that's why getting a resolution of this issue
and not losing their main source of revenue for the next
couple years is vital if they're going to be able to tackle
this. And they're going to need a lot of help. They're going
to need a lot of help to do this.
Q: How is the U.S. prepared particularly to help them
develop a revenue stream, since I would imagine that things
such as property taxes that we have here in the U.S. aren't
as readily accessible for government operations?
Ambassador Lyman: Right now, oil provides 98 percent of the
budget of South Sudan. And the other alternatives are still
very, very underdeveloped. Most of the people live in the
rural area. They're poor. It's not a commercialized
agricultural sector. Even though there's potential there,
they import most of their food. So there isn't really a
solid tax base that can even begin at this point to
compensate for the loss of oil revenue.
Now, we are helping, along with others, to develop
agriculture. We had a big conference here called the South
Sudan Engagement Conference, where we encouraged private
sector investment. There was a lot of interest in it. I
think over the longer term, they must diversify away from
oil, but that's going to take several years at best.
Q: I'm just wondering if you could tell us a little bit
about your - the tenor of your conversation with Khartoum
these days. I mean, we have another report this morning that
aircraft, presumably Sudanese aircraft, have bombed a
refugee camp in South Sudan. This seems to be recurring
practice. How are you reacting to that, and what's your
message to them? And are they - what are they telling you?
Ambassador Lyman: Well, we are concerned about this. This is
the second bombing of a refugee camp in South Sudan. It
violates all the rules regarding refugees. And we have
raised that, raised that in the UN Security Council as well
as with the government in Khartoum. Their reaction has been
mixed on the first incident. I haven't seen their reaction
to this incident yesterday. But they went through a number
of explanations on the last one, which - some of which were
not credible, et cetera.
This is, again, as we've said to the government in Khartoum,
an example of why this war is bad for everybody. And bombing
South Sudan is only going to aggravate the situation. The
Republic of Sudan claims that South Sudan is feeding this
rebellion, and if that were stopped, the rebellion would
end. That's just not accurate. Even if there were assistance
from the South, that isn't what's at the heart of this
So we've raised this very much with Khartoum. They haven't
appreciated our doing so, but we have. And we have continued
to discuss with the Government of Sudan the importance of
resolving the issues in Southern Kordofan and Blue Nile,
that that these are getting in the way of our normalization
process, and we'll continue to have that dialogue.
Q: Given all of these problems that you've just discussed,
are you concerned that the - sort of the victory that was
the July independence declaration and all of the work that
went into that is in danger of being unraveled, that the
Sudan project is, in both cases, South and North, is really
at risk of going right back off the rails now?
Ambassador Lyman: I don't think either Sudan or South Sudan
wants or intends to go back to full-scale war. I really -
I'm almost totally convinced of that. That doesn't mean that
they have a good relationship at all and that there aren't a
lot of friction points on the border, over Abyei, over oil.
And the relationship is bad. So there is a danger that
things could get out of control, that incidents could lead
to greater conflict. That's why these issues are so terribly
important, not only in and of themselves but to prevent
exactly what you're talking about. But I think both sides
recognize that going back to full-scale war would be
disastrous. So I think we still have to look upon that
successful independence of the South as a great achievement
and be thankful for it.
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