Bashir took power militarily in 1989, since then his regime has accumulated 23 billion dollars in debt
In October, I reported from Istanbul that the Sudanese government had sent a delegation to the annual International Monetary Fund/World Bank meetings to seek a debt-relief package from the international community. With an economy hemorrhaging from the global financial crisis, the delegation sought relief from an estimated 36 billion dollars in foreign debt.
The Save Darfur Coalition has called for the international community to condition any debt-relief package on concrete and lasting progress toward peace in Sudan. To provide more information on this new mechanism for the international community to place pressure on Omar al-Bashir’s regime and to offer earned incentives for peace, we have just published a new paper entitled, “A Leverage Point for Peace: how the United States should deal with Sudan’s troubling debt.”
Here is the executive summary:
The current global economic crisis has significantly affected Sudan’s fragile economy. The country’s large existing public debt burden—which ballooned under the National Islamic Front/National Congress Party reign from 1989 until today—frustrates its attempt to access needed foreign capital during the financial downturn. Like other struggling countries, Sudan has sought a debt-relief package from its creditors to overcome its current challenges.
This debt, however, has been incurred by an unrepentant, unreformed regime, and has effectively subsidized war and genocide waged by the Sudanese government against its own people. The Sudanese people have been burdened with more than $23 billion in “odious debt” from the Omar Al-Bashir regime’s campaign of negligence and destruction over the last 20 years. During the past six years, moreover, robust economic gains have underpinned the government’s hubris and intransigence in confronting the international community on Darfur. Now in dire straits, the Sudanese government has redoubled its push to secure a debt-relief package and economic foreign assistance agreement as part of its bilateral talks with the United States, with American allies, and with multilateral creditor institutions in which the United States plays a key role.
With Sudan at a dangerous crossroads, President Obama must present those in power in Khartoum with a choice between earned incentives or serious consequences. His administration should lead an international coalition of Sudan’s creditors to condition any consideration of debt-relief or debt-servicing adjustments on concrete and lasting progress toward peace in Darfur, the full implementation of the Comprehensive Peace Agreement (CPA), and significant structural political and judicial reforms that fundamentally change the repressive systems in Sudan. For a more prosperous future in Sudan, the international community must rid the Sudanese people of this burdensome and “odious” debt created by the regime in Khartoum – but Sudan’s leaders should know they first must finally commit to extinguishing the flames and embers of decades of war in Sudan.
This aggressive lobbying by the Sudanese government continues and the economic conditions that precipitated the urgent requests have not disappeared. Instead, Sudan’s Central Bank Governor Mohamed al-Hassan Sabr last week confirmed that Sudan’s banks still have not recovered from the global crisis. Foreign reserves remain low due to a decline in oil revenues, as well a significant drop in foreign investment and financing (link in Arabic). As inflation has increased and the Sudanese pound has become less valuable compared to other currencies, the average Sudanese person has seen the cost of food, consumer goods, and imports become much more expensive over the last year. With elections looming, Bashir certainly wants to reassure those committed to his National Congress Party (NCP) – and more broadly the Sudanese people – that his economic policies are working. This fact is yet another reason why debt-relief has become such an important issue for the Sudanese government.
Overall, the global economic crisis and Sudan’s ballooning foreign debt has created a unique set of circumstances that economically compel the NCP regime to seek debt-relief from the United States and other countries and multilateral lenders. We must therefore call on President Barack Obama to take advantage of the reality of the NCP’s economic woes and the existence of a broad array of states who share the distinction of being Sudan’s creditors. As part of his administration’s engagement plan with Khartoum, Obama should make clear to the Sudanese government that debt-relief can only be an earned incentive conditioned on concrete and lasting progress toward peace in Darfur, the full implementation of the CPA, and significant structural political and judicial reforms that fundamentally change the repressive systems in Sudan.
The opinions expressed here are those of the author(s) and do not necessarily reflect the position of the Save Darfur Coalition.
Tags: Darfur, debt relief, Omar al-Bashir, President Obama, Sudan
