Thursday, May 17, 2012

South Sudan: Breaking the Standoff on Post-Independence Issues with Sudan

By John A. Akec
The Time for Joshua to Lead from the front has come!
 Dr. John Garang de Mabior code-named the current President of South Sudan, Salva Kiir Mayardit, "tiger". South Sudanese affectionately call him "Joshua" for taking over successfully from where Dr. Garang de Mabior or "Moses" had left off, then crossing the Jordan and leading his people to promised-land. New African Magazine listed Mayardit as one of top 100 contemporary African personalities in 2011, citing:"using his dogged pragmatism, [President Kiir] led his people through tough and tortuous negotiations to independence in 2011." Searching for more Biblical analogies about the character of our President, we could also add that President Kiir has the patience of Job. In the New Testament, he is John, the disciple that Jesus favoured; or Simon Peter, the rock on which the Church is built, and entrusted to look after the sheep. Mayardit was the chief SPLM negotiator at Machakos talks in Kenya in 2002 the outcome of which marked a turning point in the long North-South conflict that paved the way for conclusion of 2005 Sudan's Comprehensive Peace Agreement. Praiseworthiness comes loaded with weighty obligations and high expectations.

 Now, times are a testing, and South Sudan, as eloquently described recently by Dr. Majak D' Agoot, the Deputy Minister for Defense and Veterans Affairs, "is facing existential threats." More than any other time, the exercise of greater wisdom is critical for the survival of South Sudan at the cross-roads. President Kiir Mayardit is being called upon again to lead from the front as he did at Machakos in 2002. Current South-North Standoff Resembles Cuban Missile Crisis of October 1962 with one Difference: "The Gravest Thing did occur!" At the height of cold war between United States and Russia, American intelligence reconnaissance photographs over Cuba between September and October 1962 proved beyond reasonable doubt that Russians were installing intermediate surface to air missiles (SAMs) that were capable of carrying nuclear warheads. Lacking long range missile technology, installation of such missiles in Cuba, just 90 miles off the coast of Florida, would had equalized the balance of arm race between the two super powers, and for first time brought United States within Soviets nuclear missile hit. Earlier, President John F. Kennedy had threatened: "If Russia ever deploys offensive [meaning nuclear missiles] weapons in Cuba, the gravest thing would occur!" Fortunately after 13 days of standoff, the US and Russian leaders agreed a secret deal that saw Russia withdrawing its nuclear weapons from Cuba, and US withdrew its nuclear missile installations from Turkey, and promising not to invade Cuba. The gravest thing was thus averted and the World was rescued from the perils of an all out nuclear war.

 In South Sudan, President Salva Kiir once warned the Sudan not to take unilateral decision to confiscate South Sudan's oil because "South Sudan managed to live for 22 years without oil, if such a thing should ever occur, South Sudan will close down oil production and wait for another 4 years to build an alternative pipeline…" As far as South Sudan was concerned, that was the gravest mistake North Sudan could commit to bring the already tense relationships down to an all-time low. Unlike Cuban missile crisis, Sudan went on to confiscate South Sudan's oil and South Sudan responded by shutting down oil production. The gravest thing did indeed occur and there is more in store, unless wisdom prevails (from both sides) to save the two countries from a mutually destructive economic war.

Frenetic Race to the Bottom of Inferno
 Already, a World Bank brief about the state of South Sudan's economy (a copy of which was obtained by the author) has painted a bleak picture about the negative social impacts of oil shutdown. It predicts a jump in the number of people living under poverty line (or those spending less than USD 1.2 per day) from 51% in 2012 to 83% in 2012; infant mortality rates for under 5s will double from 10% in 2012 to 20% in 2013; school enrollment will drop from 50% in 2012 to 20% in 2013 (which is what it was in 2004).

In Sudan, inflation is running amok and Sudanese pounds has lost half of its value and still falling. It is a race to the bottom of inferno from which none of the two countries will rise unscathed. The inevitable question is: is it worth it for the two countries to put themselves to such a grueling test? Can governments of the two countries concerned exercise greater flexibility in order to strike a deal about oil that will ensure that the economic, social, and political gains brought about by Sudan Comprehensive Peace Agreement (CPA) are not lost in smoke?

Public Support to Oil Shutdown 
By all means, shutting down of oil production in South Sudan was not a light decision to make. It was no lesser serious than a declaration of war, albeit an economic one. It was risking everything in order to assert our ownership of our decision as sovereign nation. It was saying we own our destiny and can do whatever it takes to assert that very principle, whatever consequences those decisions may entail. Sudan had to be made aware that threats and warnings by South Sudan are implementable and must be heeded and given the attention they deserve. That South Sudanese people have shown an overwhelming support for their government's decision by staging demonstrations in their thousands across their various sectors (civil society, students, women and youth groups) had expressed in no uncertain terms their readiness to pay sacrifices in form of economic hardships and will go a long way to strengthen the government's position at future negotiations on oil issues with Sudan. That this support must be reciprocated by the government of South Sudan through ensuring citizen's interests and livelihoods are protected and sustained with great care and great responsibility is a debt our government still owes the people of South Sudan. In other words, we (the government and the people) are each the other brother-keeper.

Striking a Deal with Sudan on Oil is Inevitable
The Sudan pricing of oil transit and processing fees at USD 32 is anything but realistic. This is greed at its worst. It meant no good for the people of South Sudan. Yet, we must realise that achieving our economic independence will take time and effort to materialize, while in the mean time, wisdom will dictate us to put up with some unfair exploitation until our house is in order. That as a landlocked nation, countless odds will be stuck against us by friends and foes alike who would strive to capitalize on our vulnerability; and that we must be smart enough not to fall victims to such malicious schemes designed to push us to mass economic suicide such as losing 98% of our income at a stroke of a pen! It means, doing whatever it takes to avoid being boxed into a corner from which we cannot emerge unhurt. It also means paying something that will be enough to tempt our erstwhile exploiters to reconsider their entrenched positions. After all, politics is about the art of the possible. It is very much results-driven. And we must excel that art in order to thrive in the face of great animosity.

While South Sudan has been extremely generous by offering 69 cents per barrel in addition to USD 2.5 billion of cash transfer too Sudan in the next 5 years, and if Sudan has foolishly and obstinately rejected such an offer, I would like to suggest that we go back to the table and increase our offer to somewhere between USD 3 and USD 5 per barrel (that is an astonishing increase of 724% over our initial offering). That is an incredible USD 1.7 million per day or USD 633 million per year. Suppose a barrel sells at USD 80 per barrel in the crude market, South Sudan will retain USD 75 for each barrel. If prices drop to USD 35 per barrel, we still keep USD 30 for each barrel. It is not bad deal at all for South Sudan as a temporary measure. If the government of Sudan should venture to reject such an offer, it will come under enormous pressure from its own citizens who need the money to relieve them from inflationary prices brought about by falling supply of dollar. We will also win over the mediators and a final agreement could be within reach. Game theorists refer to this as the search for equilibrium or saddle point. A deal that satisfies your contender without leaving you worst off.

Attention must then urgently turn to finding alternative means of transporting our oil that should not only be confined to building a pipeline to East African coast but also to consider other alternative, and possibly more advantageous modes of transportation such as building railway to Kenya which can help South Sudan break its landlocked status with a positive impact on our economy. The debate on alternative mode of transportation should start earnestly.

The Rationale behind All of It
Peace and good neighborliness with Sudan is a strategic goal on which much of our livelihoods hinge for foreseeable future. Economic viability of two Sudan's and exchange of mutual benefits is the only means to smooth the way towards resolving other outstanding issues. Peace will come if Sudan reaches a political settlement in Blue Nile, South Kordofan, and Darfur using CPA as a model of resolving political differences. What’s more, Sudan must be made to understand that it is in its best interest to recognize the authenticity of political grievances raised by the citizens of these conflict areas, and that it demands the same courage the parties demonstrated in ending the long North-South conflict through negotiated settlement as opposed to gun barrels. That referendum on self-determination for Abyei should take place as soon as possible within time to be agreed between the governments of South Sudan and Sudan.

Wrapping it Up 
The author believes striking a deal on oil transit fees will create conducive atmosphere that will enable progress to be made towards a political settlement in Blue Nile, South Kordofan, and Darfur. This should be followed by roadmap on Abyei's self-determination referendum. Next is to sign agreement on 4-freedoms between Sudan and South Sudan. Border demarcation should follow last. The order is important for the success of negotiations. It is worth considering that President Salva Kiir Mayardit and President Bashir should lead these crucial negotiations, assisted by their technical teams.

Finally, it is worth reminding ourselves that what should be permanent are not friends or foes we may have, but vital national interests we must pursue. It is not about doing things right but about doing the right thing.


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