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Why Does Khartoum Pursue Policies so Destructive of the Economy?

Posted by sudanprotests on December 27, 2012 at 7:35 PM

Why Does Khartoum Pursue Policies so Destructive of the Economy?


By Eric Reeves, a professor at Smith College in Northampton, Massachusetts


>>> Continued from Part 1


Despite the already acute and growing danger of complete economic implosion, the regime persists with immensely expensive and unproductive policies, including war in Darfur, South Kordofan, and Blue Nile, as well as hostile actions along the North/South border, and the supplying of renegade militia groups inside South Sudan. For a regime that is ruthlessly survivalist, this makes no rational sense: current economic realities are diminishing the chances that the regime will survive. So why is it persisting in policies and actions that work against a resumption of transit fees for oil originating in South Sudan and passing through the northern pipeline to Port Sudan? Why is the regime creating a situation in which the generous transit fees that Juba is willing to pay have been forgone? This seems even more peculiar, given the grasping nature of Khartoum's greed, revealed earlier this year when Southern engineers discovered a covert tie-in line to main oil pipeline, capable of diverting some 120,000 bpd of Southern crude. This subterfuge has not been forgotten by the South, and only makes more exigent the question: why has Khartoum put oil transit revenues in jeopardy?


At full capacity—350,000 bpd—these pipeline revenues could do a great deal to close the yawning budget gap that Khartoum faces; and this is on top of Juba's agreement to assist Khartoum financially during a difficult transition and also to allow the regime to keep the more more than $800 million sequestered during the stand-off over transit fees (the amount of oil was peremptorily calculated by Khartoum on the basis of its outrageous $36/barrel fee proposal). What keeps Khartoum from finalizing the deal on oil transport, thereby creating further doubts in the minds of Southerners that this pipeline will remain a viable means of export? Why does Khartoum continue to wage a brutal economic war of attrition against South Sudan, which should be its largest and most important trading partner? The reality of lost oil income is inescapable:


"Prior to [the secession of South Sudan], about three-quarters of crude production came from the south and accounted for more than 85 percent of Khartoum's export earnings, which reached $7.5 billion in the first half of 2011, according to the World Bank. 'They've lost that (oil) income. It's gone for good,' an international economist said, declining to be identified." (Agence France-Presse [Khartoum], February 26, 2012)


Here again the common distinction between "moderates" and "hardliners" is better understood as referring to differences within a regime that is at various times more and less pragmatic, or at least has very different views of what is "pragmatic." Ali Osman Taha, for example, is often cited as a "moderate" because of his central role in the Naivasha peace talks; it is rarely remarked that in February 2004, a year before those talks would culminate in the signing of the Comprehensive Peace Talks, Taha left Naivasha to "address the Darfur crisis." As anyone who followed the course of events through 2004 and into 2005 knows, this was the period marked by the very height of genocidal violence and destruction. An October 24, 2004 report from the U.S. Congressional Research Service notes:


"In February 2004, First Vice President Ali Osman Taha, the government [of Sudan's] chief negotiator [in Naivasha], told the mediators that he had to leave the talks to deal with the Darfur problem. In February 2004, the government of Sudan initiated a major military campaign against the Sudan Liberation Army and Justice and Equality Movement and declared victory by the end of the month. Attacks by government forces and the Janjaweed militia against civilians intensified between February and June 2004, forcing tens of thousands of civilians to flee to neighboring Chad."


As we know now, many tens of thousands of people were also killed by the violence of this period, and the killing continued long after Taha's intervention, with total mortality now in the range of 500,000. The number of internally displaced persons would, according to the UN's Office for the Coordination of Humanitarian Affairs, grow to 2.7 million. The UN High Commission for Refugees estimates that more than 280,000 Darfuris remain in eastern Chad as refugees. That Taha the "moderate" played such a central role in the Darfur genocide is far too infrequently acknowledged, suggesting again that within the NIF/NCP "pragmatism" may take many forms.


After much shifting in language and positions, Khartoum would now have the world believe that it will uphold the agreement on oil transport only if Juba agrees to various "security arrangements." But of course just what these arrangements are keeps changing, even as Khartoum ignores the most fundamental requirement for security in both Sudan and South Sudan: a fully delineated and authoritatively demarcated border. This of course should have been achieved in the "interim period" of the Comprehensive Peace Agreement (January 9, 2005 to July 9, 2011). That it was not is almost entirely the fault of Khartoum, which evidently thought—and still thinks—it can extort borderlands from the South and incorporate them into Sudan. The military seizure of Abyei (May 2011) was simply the opening salvo. Military ambitions may in fact extend to seizing more Southern oil fields and arable land.


More recently, Khartoum's demanded "security arrangements" have come to include Juba's disarming of the Sudan People's Liberation Army-North, an utterly preposterous notion—indeed, so preposterous that it must be viewed as a means of stalling negotiations. In this respect it is very similar to Khartoum's initial proposal of a US$36/barrel transit fee proposal during negotiations on that issue: this was not an opening gambit, not a serious proposal from which compromise could be reached. It was meant to halt negotiations and indeed resulted in Juba's decision to shut down oil production altogether.


So, too, the current "security arrangements" proposal is meant to put a hold on negotiations by demanding what the South cannot possibly offer or provide, even as senior officials in Khartoum continue to insist that they will not negotiate with the Sudan People's Liberation Movement-North, insisting that the "alliance" between Juba and the SPLM/A-N must first be ended. And yet no evidence of substance is offered to suggest any military alliance. We may understand why the NIF/NCP wishes the army of South Sudan to disarm northern rebels, primarily in the Nuba: Abdel Aziz al-Hilu's forces are manhandling SAF troops and militias, chewing up entire battalions and parts of some brigades and in the process acquiring a great deal of ammunition, weaponry, fuel, and other supplies (despite this, Ahmed Haroun—indicted war criminal and governor of South Kordofan—insists that the SAF will achieve victory soon). But does anyone living in the real world think that Juba will help to disarm the SPLA-North? These are former comrades in arms, deeply connected by the years of suffering and fighting together, and by a deep mutual suspicion of Khartoum. In the absence of any substantial evidence that Juba is aiding the rebels in the Nuba in a significant way, we must conclude that something else is going on here.


It is important to remember that while the regime has been in power for 23 years, individual members and factions of this regime have relentlessly jockeyed for power, often ruthlessly pursuing their own interests, and have found themselves on occasion in significant ascendancy or decline. The most recent example appears to be Salah Abdallah "Gosh," once head of the extremely powerful National Intelligence and Security Services; further back, we have the sharp split between al-Bashir's cabal and Islamic ideological leader Hassan al-Turabi in the late 1990s. But ambition within the regime's central cabal has never, in any quarter, been "moderated" by a desire to do what is best for the people of Sudan.


The most notable recent ascendancy is that of key senior military officials in decision-making about war and peace; this too has gone insufficiently remarked, despite very considerable evidence that on a range of issues, military views have prevailed. The nature of this ascendancy, and the motives behind it, were first emphasized by Sudan researcher Julie Flint in an important account from in August 2011, based on an extraordinary interview with an official in Khartoum. The official, whose account has been corroborated by other sources, warned that a silent military coup was already well under way in Khartoum before the seizure of Abyei (May 2011). There seems little doubt that if this official's account is accurate, and there has in fact been a successful military coup from within, then there will be very little room for civilians in the new configuration of power when it comes to issues of war and peace:


"[A] well-informed source close to the National Congress Party reports that Sudan's two most powerful generals went to [Sudanese President Omar al-] Bashir on May 5, five days after 11 soldiers were killed in an SPLA ambush in Abyei, on South Kordofan’s southwestern border, and demanded powers to act as they sought fit, without reference to the political leadership."


"'They got it,' the source says. 'It is the hour of the soldiers—a vengeful, bitter attitude of defending one’s interests no matter what; a punitive and emotional approach that goes beyond calculation of self-interest. The army was the first to accept that Sudan would be partitioned. But they also felt it as a humiliation, primarily because they were withdrawing from territory in which they had not been defeated. They were ready to go along with the politicians as long as the politicians were delivering—but they had come to the conclusion they weren't. Ambushes in Abyei…interminable talks in Doha keeping Darfur as an open wound…. Lack of agreement on oil revenue….' 'It has gone beyond politics,' says one of Bashir’s closest aides. 'It is about dignity.'"


How well borne out by subsequent developments is this assessment?


When the senior and quite powerful presidential advisor Nafie Ali Nafie signed on June 28, 2011 a "Framework Agreement" with the Sudan People's Liberation Movement-North, it seemed for a moment in which war in the Nuba and Blue Nile might be averted. Three days later President al-Bashir emphatically renounced the breakthrough agreement, declaring after Friday prayers (July 1, 2011) that the "cleansing" of the Nuba Mountains would continue. This was clearly a declaration made at the behest of the generals, specifically Major General Mahjoub Abdallah Sharfi—head of Military Intelligence—and Lt. Gen. Ismat Abdel Rahman al-Zain— implicated in Darfur atrocity crimes because of his role as SAF director of military operations, he is identified in the “Confidential Annex” to the report by the UN panel of Experts on Darfur (Annex leaked in February 2006).


These men and their military colleagues are the ones whose actions have ensured that Abyei will remain a deeply contentious issue in growing tensions between Sudan and South Sudan; certainly they knew full well the implications of taking military action in Abyei—military action that directly contravened the Abyei Protocol of the Comprehensive Peace Agreement. This action ensures that Abyei will continue to fester and may yet lead to confrontation if—as is likely—both the African Union and the UN Secretariat and Security Council continue to temporize over the AU proposal on the permanent status of Abyei, a proposal subsequently endorsed by the AU Peace and Security Council but rejected by Khartoum. And as long as Abyei festers, negotiations over other issues are made gratuitously more difficult, and it becomes ever less likely that sustained oil transit revenues from use of the northern pipeline will resume. After losing almost a year's worth of oil revenue, the South will certainly proceed with plans for an alternative export route. Khartoum's sequestration of almost a billion dollars of oil revenues due to the South since independence (July 9, 2011) left Juba feeling deeply uneasy about any viable long-term arrangement with the current regime, despite the decision to allow Khartoum to keep the oil revenues it had illegally sequestered.


From the standpoint of a rational management of the economy, the military decisions made have been consistently disastrous. This is true whether we are speaking of genocidal destruction (and economic collapse) in Darfur; renewed genocide in the Nuba Mountains, which has prompted a ferociously successful rebel military response; massive civilian destruction and displacement in Blue Nile; the military seizure of Abyei; the extremely ill-considered assaults on forces of the SPLA-South in the Tishwin area of Unity State in March/April of this year; support for renegade militia groups in South Sudan; the growing assertion of unreasonable claims about the North/South border; and the repeated bombings along the border over the past year and a half, including the "Mile 14" area of Northern Bahr el-Ghazal. This is an extraordinary catalog of offensive military actions. And none of them reflects a concern for economic problems that may well bring down the regime. On the contrary, these decisions represent a bitter, vengeful desire to "get even" with South Sudan for exercising its right to self-determination. But vengeance will not rescue the failing northern economy, and absent the resumption of oil transport income, the economy will continue in free-fall, with hyper-inflation daily more likely. Normal corrective measures in economic policy are impossible in the context of current military commitments; corrections that would in any event have been highly challenging in light of the precipitous cut-off of oil revenue are now unavailable.


So long as decisions about war and peace are being made in Khartoum by the generals, without regard for the effects of continuing and renewed fighting on the broader economy, Sudan will remain both brutally violent and ultimately untenable under present governance.


Advocacy Recommendation

 

The one decision the international community, and Paris Club members in particular, should make is not to engage in any discussions of or planning for debt relief for Khartoum until the regime disengages from all military campaigns that target civilians, and ceases military actions so indiscriminate as to ensure widespread civilian destruction such as we have seen most recently in South Kordofan and Blue Nile, previously in Abyei, and for very nearly ten years in Darfur. The international banking system as well as international financing resources should do nothing that will convince Khartoum it may escape paying a heavy price for its continuing atrocities in these regions. For its part, the regime continues to speak confidently about its prospects for international debt relief. It's hard to know whether this proceeds from expediency—even the artificial prospect of partial debt relief would help the northern economy immensely—or cynicism: the international community has capitulated before Khartoum's demands, has accepted the validity of its commitment to signed agreements, on so many occasions that the regime may calculate it will prevail yet again.


This must not happen. The international community has failed greater Sudan for too many years now, has accommodated a murderous, finally genocidal regime in Khartoum since June 1989, and now is a moment for moral clarity and principled decision: will the world fund this regime? Will it accept massive atrocity crimes in Sudan in the interest of something other than the well-being of the Sudanese people themselves?


Civil society in those countries most significantly represented in the Paris Club should lobby their governments to state publicly that the unqualified priority in Sudan policy is ending civilian destruction throughout greater Sudan. Unequivocal evidence that this "priority" obtains in national policies must be demanded. As presumptuous as this may seem to some, it is what vast numbers of people from greater Sudan wish, as do many well-informed friends of the region.


It is a simple "ask": no debt relief for a regime that continues to commit atrocity crimes against civilians on a wide scale. This debt was accrued in large measure by profligate military expenditures on weapons that are even now being deployed against hundreds of thousands of noncombatant civilians. Yet as simple and apparently reasonable as such an "ask" is, there are very good historical reasons to believe that it will be refused; rather, some factitious "occasion" will be found to provide Khartoum with a financial life-line—a decision defined by its expediency, not its moral intelligibility. There could be no more irresponsible use of international economic and financial resources.  Read Part 1


Related: Its Biscally over - The Sudanese Dictatorship's Dwindling Options


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