South Sudan oil business and leadership inept
By James Okuk
January 22, 2012 — The hottest news about Sudan these days, especially at international arenas is the case of conflict of interests on oil business between the Republic of the Sudan and its separated former territory that has declared its independence on 9th July 2011. But although some South Sudanese government leaders feel irritated to see some of us who are civil servants stating our opinions publicly, still we remain unintimidated to revere the rule of the highest law in the country that allows the practice of the bill of rights by each and every citizen regardless of who employs him or her. Not only this, but also article 139 (l) of the current transitional constitution permits all the civil servants of the new Republic to publicize their opinions whether it is in support or critique of the government policies and actions.
The case at focus here is the decision of the council of ministers of the government of the Republic of South Sudan to shut down oil operations and productions in its territory because of dishonesty and unfair deduction carried on by the government of the Sudan under pretext of transit fees charges. This irritating practice has been going on for some times and the GoSS got provoked at last as the flow of South Sudan oil reaches the international markets in a less quantity than expected. But are the governments of the two neighboring countries justified to have acted the way they did?
As far the spirit and desire for good neighborhood policy is connected, the two governments are not justified to have acted so because of the damage they could incur on each other’s peoples though with different degrees of gravity. Thirty six (36) US dollar is highest a charge that a good neighboring Sudan can levy on each barrel of crude oil transiting its territory. But also not wanting to reach a quick agreement on a consensual amount that could be paid as a transit fee for South Sudan crude oil is also a bad faith from a nascent GoSS. As it is not good to charge a neighbor very highly, it is also not good to use the land of a neighbor free-of-charge for longer time without a consent. What should have been the good thing to do then?
The GoSS should have never abandoned negotiations for reaching a fair deal on transit fee. This should not necessarily have been conditioned to what is happening between other countries regarding oil transit fees. It could have been a little higher as the situation, the terrain and the distance of transit is different from the ones found in countries like Chad and Cameroon.
On the other hand the GoS should have calmed down and looked at South Sudan without envy of the plenty of dollars that its oil generates in the markets compared to the little that have remained for the Sudan. It could have charged reasonable fees that would have motivated South Sudan not to think of shopping for a better customer for transiting its oil to international markets.
Nonetheless, the bad decisions have been taken by both the GoS and the GoSS, and we are left with nothing but to analyze and deal with the man-made crisis in order to find exit window if possible. The analysis may be generated by the following questions of critical thinking:
1) Which is a lesser evil; a thief that steal crude oil or a thief that steal petrodollar of the people of South Sudan?
2) Can Kenya, Uganda and Ethiopia be guaranteed and trusted to be honest and secure in transiting South Sudan oil to international markets?
3) Is it wise to do a transit of oil through two countries rather than one country; and what could happen if the middle country on the transit to the sea or ocean gets into troubles with any of the two countries involved in the deal?
4) Are Total and Toyota companies who proposed to build oil pipelines for South Sudan via Uganda to Kenya doing this out of love for South Sudanese or out of lust for profits that could be exploited out of a weak and desperate country?
5) Why should the oil of South Sudan be sent back to rest undisturbed under the ground after it has already been discovered and the sweetness of its revenues enjoyed for some good years?
6) Is GoSS sure the oil value will remain intact in near future as it rests in peace untouched underground; what if another source of energy appears and make oil a history like the case of coal?
7) Has the GoSS a good faith in offering an assistance of 2.6 million dollars to the Sudan or there are some other ulterior motives behind?
8) If The GoSS is genuine in its talks of wanting to assist the GoS so that it could avoid economic collapse and if the GoS is charging high transit fees so that it could fill the economic gaps that have been created by the situation of separation of South Sudan; why the quarrels from GoSS who want to help the GoS then? Does this not seems to suggest that both means used from the GoSS or GoSS side justify the end (economic rescue)?
It is said that the devil you know well is far more guaranteed than the ones you don’t know best. South Sudanese have been in the Sudan and with the Sudanese in both thick and thin. They know the Jellaba and the Jellaba know them.
Shutting down the oil operations and production in South Sudan because of quarrels with the Sudan over transit fees is not prudent at the moment. After all the alternative is not yet in existence and talks on this is still at the level of fantasy and utopia. Also the nature of the countries that are involved in the talks about the alternative is questionable as far as security or fair deal is concerned. Uganda and Ethiopia are already landlocked countries like South Sudan. They will also be charging transit fees before either Kenya or Djbouti charges South Sudan for transit and access to their ocean and see ports respectively. Why pay unnecessary transit fees to these landlocked middle countries when we can negotiate and reach a fair deal with one country that we are accustomed with, the Sudan?
Also keeping oil under the ground when it is the core fuel of government and even private sector business in South Sudan is not a good decision too. I am not sure whether the GoSS has control on how nature works. The very oil it thinks of keeping under the ground for safety may disappear or dry up or lose its value in future; who knows?
I think it not bad and dull to live and enjoy the blessings of one’s time and place. Let South Sudanese not be denied enjoyment of their current blessings even if little because of sharing it with a greedy neighbor.
Oil revenues should not get stopped now for the mere sake of future use. The future may come with its own blessings or curses that could be different from our present today realities.
South Sudan National Legislative Assembly are you there? The Sudan National Legislative Assembly was there when the decision was taken to deduct crude from South Sudan oil as a charge in kind for transit fees. Wake up in Juba before Juba wakes you up on this risky situation to South Sudan economy?
Dr. James Okuk is a lecturer in the Department of Political Science of the University of Juba. He could be reached at [email protected]