Divesting from DarfurII. The link between foreign direct investment and genocide Despite an ongoing genocide in Darfur, the government of Sudan's revenue has actually increased each of the past several years. This growth has been largely sustained by heavy foreign direct investment (FDI), especially in the oil, energy, and construction sectors. According to the International Monetary Fund, Sudan's economy grew by 12 percent in 2006 and the government received over $2.3 billion in direct foreign investment, up nearly 50 percent from 2004, despite the fact that the nation's per capita income was only $640 in 2005, at market exchange rates, according to the World Bank.3 4 For the 2003 - 2005 period (which covers the start and apex of the Darfur genocide), Sudan ranked 16th among 141 countries in its capacity to attract foreign direct investment, according to the United Nations Conference on Trade and Development (UNCTAD). Where has this increased revenue gone? According to a former Sudanese finance minister, over 70% of the government's share of oil profits is spent on its military.6 There have been numerous reports further documenting the connection between government revenue, especially from oil proceeds, and the Sudanese government's ability to carry out military-backed atrocities. Among those reports are the following: Christian Aid Society (2001): The Scorched Earth: Oil and War in Sudan. Coalition for International Justice (2006): Soil and Oil: Dirty Business in Sudan. Human Rights Watch (2003): Sudan, Oil, and Human Rights. The Human Rights Watch Report cited above notes on p. 59 that since the first barrel of oil was pumped in Sudan in 1999, oil revenue has made "the all important difference in projected military spending…. The president of Sudan announced in 2000 that Sudan was using… [newly garnered] oil revenue to build a domestic arms industry. The military spending of 90.2 billion dinars (U.S. $ 349 million) for 2001 was to soak up more than 60 percent of the 2001 oil revenue of 149.7 billion dinars (U.S. $ 580.2 million). Cash military expenditures, which did not include domestic security expenditures, officially rose 45 percent from 1999 to 2001. This was reflected in the increasing government use of helicopter gunships and aerial bombardment in [the North-South civil war]." Sudan's booming economy is proof that Khartoum has not faced any serious economic punishment for its perpetration of genocide and will continue to thumb its nose at the world unless substantial pressure is brought to bear. Worse still has been the funneling of ever-increasing government revenues into military expenditures. Because the heavily debt-ridden Sudanese government (Sudan's debt was 107% of its GDP in 20057) relies on FDI to fund its genocide apparatus, institutions have increasingly considered the targeting of FDI through divestment as a means for influencing outcomes in Sudan. *All information provided by the Sudan Divestment Taskforce, www.sudandivestment.org |