Divesting from Darfur

VII. Targeted divestment and implementation of the North-South Comprehensive Peace Agreement (CPA)

The CPA, signed in January of 2005, ostensibly brought Sudan's 20+ year civil war between the Islamic North and the Christian/animist South to an end. Critics of divestment may argue that removing investments from Sudan, especially the oil industry, threatens the process of rebuilding a South utterly decimated by the civil war. It should first be noted that the Darfur region was completely left out of the Comprehensive Peace Agreement, meaning that implementation of the CPA will provide no economic benefit to Darfur's devastated population or infrastructure. Secondly, as Eric Reeves notes, implementation of the CPA has not been carried out in good faith by Khartoum. Despite wealth sharing provisions in the CPA, oil revenue is not distributed equitably. Khartoum provides minimal transparency in the distribution of oil revenue, and is assisted by China, Malaysia, and others in creating opacity around oil production, locations, and revenue.

After signing of the CPA in January 2005, "Khartoum [has] adamantly refused to grant either the Finance Ministry or the Ministry of Mining and Energy to the SPLM (South Sudan) in the new Government of National Unity. Without control of the bureaucracies and records in these two key economic ministries, there is no way for the SPLM to untangle the snarl of concession contracts, royalty contracts, construction and maintenance expenses, and other essential elements of the larger oil revenue picture. Southern Sudan will receive only what [Khartoum] chooses to share."

Furthermore, Khartoum refuses to create the boundary commission (once again, despite CPA provisions) that will allow for a reasonable division between North and South in the oil-rich Upper Nile Province. The government has also refused to accept the Abyei Border Commission Report, required by the CPA and prepared by a panel of experts that included representatives from Khartoum and South Sudan, which concluded that the oil-rich Abyei province be seen as part of South Sudan. Khartoum is claiming as "northern" oil production that historically has been clearly "southern". China and Malaysia are again instrumental in making the North/South distinction unclear. Reeves concludes that available research demonstrates revenue from the oil and energy sector is not visibly benefiting development of the South.

Reeves' conclusions are supported by numerous other sources, including top U.N. envoy to Sudan, Jan Pronk, the Minister of Cultural and Social Affairs in the Blue Nile State, Abbas Hamad, members of the South Sudan government, a July 2005 report by the International Crisis Group, a March 2006 Human Rights Watch report, a March 2006 report by Southern Sudanese author Riang Yer Zuor, and a June 2006 report by the European Coalition on Oil in Sudan.

The United States government also appears to hold the belief that the problems associated with oil in Sudan presently outweigh any benefits of the industry that might accrue to South Sudan. For example, in its most recent extension of sanctions on Sudan, the US government relaxed most investment restrictions related to South Sudan but retained a country-wide ban on oil investment.60 Keeping in line with this most recent iteration of US federal policy towards Sudan, the Task Force's model of divestment maintains relatively strict engagement/divestment criteria on oil companies operating in Sudan but provides wide leeway for most other types of investments in South Sudan.61

*All information provided by the Sudan Divestment Taskforce, www.sudandivestment.org

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