A practical guide for southern Sudan on negotiating post-referendum issues with Khartoum

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Late SPLM leader Dr. John Garang and Omar Bashir signed a peace agreement in 2005, which grants the south the right to opt for independence in 2011, but observers say a peaceful divorce of the country requires the two parties to agree on oil, citizenship, borders, the so-called referendum issues, long before the referendum.

(Michigan USA) - Most observers of the Sudanese political scene, especially on the implementation of the Comprehensive Peace Agreement (CPA), believe that Sudan is more likely to break-up than remain one country. For the break-up to be peaceful, a number of post-referendum issues need to be addressed before the divorce occurs, possibly in 2011. These issues include border demarcation, oil and foreign debt sharing, a common currency or separate currencies, citizenship and migrations, and the status of the Joint Integrated Units (of the SPLA and SAF) in case unity miraculously turns out to be the results of the referendum.

Border demarcation

The issue of border demarcation should have been settled in 2005 if there was real commitment to genuinely implement the CPA. Why Khartoum does not want it settled bodes badly for peaceful divorce. Here the ball is completely in Khartoum’s court. However, even if the border is not demarcated, it does not mean that either side is ignorant of it. Hence, separation can still occur and the border issue will be a post-separation issue.  We hear that 80 percent of the border has been demarcated. What we are not told is the remaining 20 percent. Which are the areas of contention? Do they include the areas annexed to the North in the 1960s such as Kafia Kingi-Hofra al Nahas? What about the areas taken over by the Murahellin (government militias) in the 1980s and 1990s? Can the 20 percent be made public so that natives of those areas may also contribute in the resolution of this issue?

Oil revenue sharing

Either country should own the oil in its territory. The South should choose to pay Khartoum rent for the use of the pipeline to Port Sudan. But since the pipeline is a common asset, its value should be divided between the two countries. If the North overcharges the South for its portion of the pipeline, then the South should hurry up with the construction of the Lamu pipeline. The South can also truck oil exports to its neighbors. The South should, as soon as possible, build a refinery in its oilfields in Upper Nile located near Ethiopia. From this refinery the South can truck oil exports to Ethiopia and Kenya, while still constructing its pipeline to the Lamu port on the Indian Ocean. Depending on when the Ugandan oil will begin to flow, petroleum exports to Uganda and the Congo can be trucked from a refinery near Juba, the major internal Southern market. The Central African market can be supplied through Bahr el Ghazal.  All these medium- term and long-term alternatives should be explored for eventual reduction of the South’s over-reliance on routes under Khartoum’s control.

It must also be realized that Khartoum will, over time, need markets in the interior of Africa. It will need the South, especially the Nile route, for reaching central African markets. Large and resource-rich countries such as the Congo are bound to become major regional economies. Khartoum’s major economic transactions with such countries will be through Southern Sudan. The overemphasis on seaports today is based on the assumption that Africa will continue with the present economic structures and patterns established during the colonial period.

The important point is that renting the pipeline to Port Sudan is a more flexible way for the South, over time, to reduce its reliance on the Northern pipeline than formal percentage sharing as is the case during the CPA. The South can shift out of the renting arrangement should the North overcharge it. The South should embark on a Harambe Program to begin the construction of the Lamu Pipeline. A survey of the route of the pipeline within the South should be started immediately. Students and security forces should be mobilized to begin working on the pipeline. Each county should be allocated a stretch of the pipeline to dig. This will reduce the cost of building the pipeline to Lamu as well as speed up the completion of the project. While the company is constructing the port facilities and the Kenyan- portion of the pipeline, Southerners should do what they can within Southern Sudan to speed up implementation of the project. Even if the South will secure reasonable rent from Khartoum for the Port Sudan Pipeline, the South should continue working on the alternatives as it is always better to have an alternative to anything instead of having no any other option.

Debt ($35 billion)-Division of assets and liabilities:

The division of Sudan’ debt should be tied to the assets that were created with the funds borrowed. The South should not be expected to pay for debt that was not expended on its development. The South should only pay for the portion of the debt spent on projects in the South and any debt borrowed by the Government of Southern Sudan (GOSS) and the High Executive Council (of the Addis Ababa Agreement Period).

The Sudanese foreign debt was accumulated on irrigation schemes and mechanized farming, and Arab breadbasket projects. Such projects include Rahad, El Suki, Kenana, Hassim Al Girba, Guneid, and Gezira, Pump Schemes along the Nile: either in their construction or rehabilitation. Funds were also borrowed for road construction and power generating stations in Northern Sudan as well as public buildings in Khartoum, Armament factories, Giad, etc.

Stock taking of assets and the purpose for which a loan was contracted must be undertaken before debt is apportioned between the two countries that will result from the break-up of Sudan. This process cannot be completed in the remaining six months of the CPA. It will be actualized in the post-referendum period. What we should commit ourselves to are the principles on which to share the burden. The South should never take responsibility for any debt incurred during the war as there was not development undertaken in the South.

Anyway, the projects on which the borrowed funds were spent on are visible. Those in whose territory the projects are located should pay for them. For funds without tangible projects spent on, those who borrowed the funds should account and pay for them.

A common currency or separate currencies:

Either country will issue its own currency. Since the Sudanese pound was issued in 1957, Khartoum has been the beneficiary of the seigniorage (market value of currency minus cost of printing it). As experienced during the CPA, it is impossible to trust Khartoum on any agreement to share anything. So we should not make the mistake of a common currency and then sharing the seigniorage.

Between 1958 and 1999, that is before Sudan became an oil-producing country, the Sudan Government financed a substantial part of its current operations and all of its development budget with foreign aid and seigniorage. The Bank of Sudan extended finance to its irrigation and mechanized corporations and other public enterprises through printing the Sudanese currency.

Through judicious use of its seigniorage, Southern Sudan will benefit from having its own currency before it is able to diversify its tax base. Of course, the Bank of Southern Sudan should not over-print the currency because of the inflationary consequences of an overprint. The President of Southern Sudan and his/her Minister of Finance should not over-rule the technical advice of the Bank of Southern Sudan, however much the country is hard pressed with financial difficulties.

Two main areas the South should allocate its seigniorage to would be cash purchases of crops from the peasant farmers as the crop production will liquidate the inflationary consequences of the newly printed money. The second area would be the meeting of shortages in wage payment. But this second item should be very limited and resorted to in extreme situations. Seigniorage channeled to rural development will generate production and will have minimum inflationary consequences.

A common currency also means a common market. In a united Sudan it is and has been the Northern industry that has benefited from the common market as Southern Sudan has no industrial products to export to the North. It is always very difficult for a new industry to compete with established ones unless there is a deliberate policy to alter the historical relationship. In the case of a united Sudan it will be an uphill for Southern Sudan to overcome Northern Sudan’s early-start advantages due to the backwash-effects (negative) of the established Northern industry. The same backwash-effects will operate if we continue to have a common currency. A common currency is only useful in a relationship in which the partners do care for each other’s welfare and therefore institute measures that can bring about justice and equality.

Citizenship and immigration

In a peaceful divorce, it should be the decision of each individual to choose which citizenship and residence they prefer. The two countries could also agree on their people having dual citizenship. As much as the political elites have major differences, there are individuals from either side who have no problems with the other side. However, if people are denied residence or citizenship in the country of their birth or migration, then they should be allowed to move peacefully to their country of origin. The issues that bring about unity or separation are not caused by the ordinary person but by the political elites. This should be how Northern and Southern migrants in each other’s territory should be viewed.

The same view should be extended to seasonal migrants, especially to the pastoral migrants on the North-South border. The arid lands on the North-South border are not going to turn green with separation. The pastoralists from the arid lands will continue to migrate southwards for pasture and water during the dry season. Nobody should be denied this life-and death annual movement. The only condition is that they should not be used to kill their hosts as had been the practices in the past.

The various governments in Khartoum have armed the Baggara to kill and abduct their neighbors such as the Dinka, Nuba, and Nuer. This practice should end whether Sudan is divided or remain one. The Bagarra should strive for better relationships with their neighbors. Their neighbors are more valuable to them than the Khartoum elites. Even if the Nuba choose to remain part of Northern Sudan, in case the South separates, continuing to oppress them may have consequences from the Southern neighbors as they will not believe that attitudes have really changed.

The Baggara and other nomadic pastoralists from the North-South borderland should be in the forefront of championing peaceful divorce and coexistence. It will be impossible to access pasture and water it a perpetually militarized war zone. Moreover, it is easier starting a war than ending it. Hence, all efforts should be exerted into preventing a violent divorce. A Sudanese “Khasmir” will be deadly particularly for the pastoral communities along the North-South border.

Joint Integrated Units (JIUS)

In the case of separation, it will not be difficult for the Joint Integrated Units (JIUs) of the

two armies to rejoin their mother-armies since they have neither been integrated nor even be re-trained with a common doctrine. However, in the case of an accidental continued one country, the three armies will have to continue in existence as during the Interim Period, until a common doctrine is developed, and all militaries will have undergone training in the common doctrine, then will they be merged into a national army. 

*Dr. Yongo-Bure is associate professor of Social Science at Kettering University, USA. He can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it. . He will appear on The Seventh Front panel Saturday to talk about post-referendum issues.


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