Sudan says northern economy will not be harmed by deal with rebels
KHARTOUM, Jan 11 (AFP) — Sudan’s northern economy will not suffer from the wealth-sharing deal between the government and the southern rebel movement amid efforts to end a 20-year civil war, government officials said Sunday.
Under the deal signed last week in Kenya with the Sudan People’s Liberation Army (SPLA), Khartoum must now share oil and other wealth and adopt a dual banking system, an Islamic one in the north and conventional one in the south.
The wealth-sharing agreement “will necessitate” revision of the budget for fiscal year 2004 that adopted recently by the National Assembly, Finance Minister Al-Zubair Ahmed al-Hassan told a press conference.
However, he said Sudan’s northern states “will not be harmed by the agreement” as Khartoum “will continue observing its obligations towards those states” for paying government salaries and supporting development projects.
Presumably the government would be able to maintain spending for non-defense programs because the expected shortfall in oil revenue would be compensated by cuts in military spending, although Hassan did not say this.
The accord provides for an approximate 50-50 split of revenue from the country’s 300,000 daily barrels of oil and other income between the government and an envisaged autonomous administration in the south run by the SPLA’s political wing.
The deal is due to come into effect once a comprehensive peace accord is signed and to remain in force during an envisaged six-year interim period when southern Sudan will enjoy autonomy from the national government before holding a referendum on its future.
It also stipulates a two-tiered banking system, an Islamic one (where charging interest is forbidden) in the north and a conventional one in the south, where a special branch of the central bank will be established
It requires the central bank is to issue a new currency with a design reflecting Sudan’s cultural diversity, and calls for funds to be set up to finance the development of the south and other war affected areas.
Bank of Sudan Governor Sabir Mohamed al-Hassan told the press conference meanwhile that a new currency will also be issued after a “final peace agreement to replace the present dinar for circulation in the north and south.”
Hassan said he believed the two-tiered banking system will not impair the country’s national economy.
“The Islamic banking system will not be adversely affected by the presence of a conventional one because the Islamic banking system is one of the most stable systems in the world,” said Hassan.
He added that the current Bank of Sudan act that was passed last year would be revised to “cope with the requirements of the coming stage of peace.”