Sudan’s peace deal brings economic opportunities

By Lin Zhishen

NAIROBI, Jan 14, 2005 (Xinhua) — After the signing of the final peace agreement over the last weekend between the Sudanese government and the rebel Sudan People’s Liberation Movement/Army ( SPLM/A), African nations are on the wings to capture various economic cooperation opportunities in the once war-torn country.

A southern Sudanese woman welcomes president Umar al-Bashir to Khartoum, Sudan, Wednesday, Jan 12, 2005. During his speech in Khartoum, Umar al-Bashir pledged to bring peace to the war-torn Darfur region. Speaking during a reception hosted in his honour by the ruling National Congress Party in Khartoum to mark the end of his tour of southern Sudan, President Umar al-Bashir promised that peace will be realized in Darfur as it was realized in the south. (AP).

On Wednesday, the Kenyan government announced plans to establish two trading centers in Sudan to tap into the emerging market. The centers will be in southern Sudan and in Khartoum, Kenya’s Trade and Industry Minister Mukhisa Kituyi said, adding the peace deal had increased prospects for enhanced trade between the two countries.

Southern Sudan covers an area of approximately 850,000 sq. km. and is expected to offer new opportunities for entrepreneurs in neighboring countries.

The active involvement in Sudan by the donor community and the rapid start of the reconstruction activities are crucial ingredients for stability in the delicate phase following the signing of the peace pact, officials said.

“It is expected that the international community will be able to join with the southern Sudan in the essential task of realizing the long awaited reconstruction of the country’s infrastructure,” Peter Nyongo, Kenya’s minister of planning and national development told Xinhua in an interview.

Kenya is pursuing a joint rail connectivity program with the southern Sudan, which is expected to radically transform the region’s infrastructure connectivity as the rail project also covers the neighboring Uganda and Rwanda.

The plans for the reconstruction of the 2,500 km Uganda-Kenya- southern Sudan railway, a project that has attracted some of the biggest train manufacturing firms in Europe, is expected to cost an estimated five billion US dollars.

Castello Garang, the SPLM/A commissioner for foreign relations, says his Movement has secured a credit line from the German government to finance the project.

Garang told Xinhua recently that the SPLM/A negotiated with the German Treasury for the loan on account of its massive control of the vast oil resources in the south after the implementation of the peace accords.

South African companies, many with experience working in countries emerging from conflicts, such as Mozambique, Angola and Congo, are aggressively moving into Sudan.

One of the South African firms, the Global Railway Engineering Consortium SA, has reportedly clinched a rail rehabilitation contract with the Sudanese Railway Corporation.

The two companies have signed an agreement worth 21 million US dollars in which the SA consortium undertakes to rehabilitate Sudan’s ailing rail system, sources said.

For the South African government, peace in Sudan represents an awakening call for the maximization of economic cooperation which, according to President Thabo Mbeki, will promote the New Partnership for Africa’s Development.

South African firms, taking note of the massive economic potentials in the oil-rich southern Sudan region, have clinched two notable deals with the Sudanese government for exclusive rights to explore oil wells in the country.

Recently, South Africa’s National Oil Company, Petro SA, reportedly signed an agreement with Sudan’s State Oil Company, Sudapet, for exclusive rights for Oil Block 14 in Sudan, where exploration will shortly begin.

In a recent press conference, SPLM/A leader John Garang said the signing of the comprehensive peace accord “would unlock the massive natural resources in southern Sudan, which had previously not been exploited because of the war.”

“The southern Sudan is ready for a paradigm shift in the political and economic sectors of the country. Peace is what it means to the people of southern Sudan. We will work energetically with all the parties in Sudan to ensure peace,” Garang told reporters on the eve of the signing of the final agreement.

The United States has enforced sanctions against Sudan for being a state sponsor of terrorism, but US Secretary of State Collin Powell promised that an end of fighting in Sudan would speed up the normalization of relations.

Powell said during a meeting with Garang and the Sudanese First Vice President Ali Osman Taha that the United States was ready to help Sudan get all the international help it needs to rebuild the collapsed infrastructure.

The US government has also made it easier for major companies to get exemptions from the sanctions. US oil companies have recently begun to show interest in Sudan’s undeveloped oil fields.

The success of the Sudanese peace deal has benefits for all involved, said Herman Hanekom, an analyst at the Africa Institute of South Africa.

“From my side, I’m thinking positively in that the south of Sudan is really offering, not only for the country itself but also for foreign investors, a fantastic opportunity to bring development through investment to the area,” he said.

Hanekom said for trade opportunities to be realized, the Sudanese government must prove itself to the people of southern Sudan.

“The government of Khartoum is going to be placed before one fantastic test. And that is they must, according to the peace agreement, allow a referendum or plebiscite in six years time for the South to decide whether they want to retain the unity of Sudan or whether they opt for secession,” Hanekom said.

The peace agreement has to bring an “immediate and clear” benefit to the people of southern Sudan, said David Mozersky, an analyst for the International Crisis Group, a global think tank based in Nairobi.

“The international community has a lot to contribute in terms of development aid and humanitarian support to help support the reconstruction process in Sudan.” he told Xinhua.

“Sudan is going to be number one in Africa and the world for investment, because it’s a large country and the infrastructure is zero. People need buildings, power, highways, hospitals. They need everything,” Tajeldin Awad, director of Spanish firm Emigres’ Sudan operation said.

However, while Africa’s largest country offers many opportunities, skeptics and those with experience working in southern Sudan say there are many uncertainties and difficulties ahead.

Southern Sudan has seen virtually no development since the 1950 ‘s and more than four million southern Sudanese fled their homes during the war and whether the donor community will come to Sudan’ s aid remains to be seen.

The Sudanese government and southern rebels sign the final comprehensive peace accord in Nairobi on January 9, marking the culmination of two years of peace process to end the 21-year-old civil war in southern Sudan, the longest-running in Africa.

The peace pact covers all the eight peace deals signed previously, including earlier agreed protocols on how to share power and natural wealth, what to do with armed forces during a six-year transition period, how to administer the three disputed areas, and the latest on permanent ceasefire and modalities of implementing peace deals.