Oil and Sudan
so now i finally get to sleep. after 2 calls at 2am, getting back at 4am, and writing the report i've had all summer to write.
i have to be at work in less than 4 hours.
Oil and Infrastructure in Sudan
Oil may very well
be the lifeline of the Sudanese government. Since the start of the Sudanese oil
industry in 1998, GDP has been growing at a steady and impressive rate, while
more and more foreign capital flows into the country each year. Tragically,
this new industry has had the opposite effect on the Sudanese people. In this
same time period, Khartoum has waged war and
genocide in the south and Darfur, killing well
over 2 million people and displacing approximately 6 million. Through military
raids and funding of militia groups, Khartoum is
undeniably committing acts of genocide in Darfur.
Economic statistics and informal reports indicate that the massive revenues
generated by the oil industry largely enable this genocide, while providing no
benefit to the populace at large, and possibly motivating further repressive
policies and attacks. Additionally, much of the infrastructure being built in
the country serves only to aid this oil industry or the military directly.
Investments in natural resource extraction and infrastructure, as well as
military industry, directly support the Khartoum
regime’s ability to carry out genocide and reinforce the lack of significant
economic consequence for doing so.
Despite
U.S. sanctions and the
destructive effects of civil uprisings and genocide, Sudan has managed to experience
strong economic growth. A general overview of the Sudanese economy sheds light
on how the deaths and displacement of millions can have no negative effect on
GDP. Approximately 80% of the population is engaged in subsistence farming,
experiencing the high mortality and low life expectancy of third-world
existence. Oil has been identified as the driving force in this growth in GDP
of approximately 6% annually and rapid decrease in inflation rates. Living
standards have remained deplorable and Sudan’s debt has remained at an
unserviceable $24 billion dollars and yet, even before the recent spike in
crude oil prices, the government managed to spend more than revenue. Oil
production, even without the discovery of additional fields, is on the path to
become Khartoum’s
largest single source of revenue. Oil revenues for 2005 are projected to be 60%
of total revenues. Expanding production capacity, new discoveries in Darfur and increasing crude prices will only make this
importance more dramatic. Reported figures meanwhile fail to disclose funds
from royalty payments and bribes to enable drilling operations in this
endemically corrupt nation. If Sudan’s
oil revenues are not uplifting the people or improving the broader health of
the economy, one must wonder where the money goes. In the past 4 years,
government expenditure as percent of GDP has more than doubled and a recent IMF
report specifically mentions military spending as being in need of reduction.
Military expenditures have dramatically increased in past years, matching or
even surpassing the annual growth in oil revenue.
Oil
does not merely enable military operations. It also provides incentives for
abuses of human rights. The central role of oil in Sudan’s north-south conflict is
evidenced by the terms of a recent peace agreement, which mandates that oil
revenues must be shared. Reports from southern Sudanese oil fields during this
conflict mentioned military soldiers violently defending oil rigs and violating
settlers’ property rights in areas of potential drilling. In some cases, oil
corporations hired their own mercenaries to accomplish this. The discovery of
oil in southern Darfur has brought on fears that Khartoum’s harsh tactics will become even
more severe in an attempt to secure these fields. In addition to oil, Sudan
has large quantities of gold, and mining efforts are developing in this
industry as well, raising similar concerns.
Investments
in Sudan’s
oil industry support the corporations that explore and drill for oil. These
corporations harm the environment, trample citizen’s rights, bribe a corrupt
government and generate billions of dollars of revenue for the economy. These
lucrative operations directly enable the genocidal acts by the Sudanese
military and its proxy militias, while the people of Sudan continue to suffer and live
in poverty. The security blanket of oil revenue has dissuaded Khartoum from pursuing peace agreements and
shielded the regime from external political and financial pressure. Nearly all
foreign direct investment to Sudan
is in the oil industry, as it is considered the only stable industry in the
nation. Divestment becomes a powerful tool when one considers that any
instability in oil production has a cyclical effect on further investment and
further production and exploration ability. Any decrease in oil production
would result in a decrease of military capacity, and Khartoum would be forced to more seriously
approach peace talks.
i have to be at work in less than 4 hours.
Oil and Infrastructure in Sudan
Oil may very well
be the lifeline of the Sudanese government. Since the start of the Sudanese oil
industry in 1998, GDP has been growing at a steady and impressive rate, while
more and more foreign capital flows into the country each year. Tragically,
this new industry has had the opposite effect on the Sudanese people. In this
same time period, Khartoum has waged war and
genocide in the south and Darfur, killing well
over 2 million people and displacing approximately 6 million. Through military
raids and funding of militia groups, Khartoum is
undeniably committing acts of genocide in Darfur.
Economic statistics and informal reports indicate that the massive revenues
generated by the oil industry largely enable this genocide, while providing no
benefit to the populace at large, and possibly motivating further repressive
policies and attacks. Additionally, much of the infrastructure being built in
the country serves only to aid this oil industry or the military directly.
Investments in natural resource extraction and infrastructure, as well as
military industry, directly support the Khartoum
regime’s ability to carry out genocide and reinforce the lack of significant
economic consequence for doing so.
Despite
U.S. sanctions and the
destructive effects of civil uprisings and genocide, Sudan has managed to experience
strong economic growth. A general overview of the Sudanese economy sheds light
on how the deaths and displacement of millions can have no negative effect on
GDP. Approximately 80% of the population is engaged in subsistence farming,
experiencing the high mortality and low life expectancy of third-world
existence. Oil has been identified as the driving force in this growth in GDP
of approximately 6% annually and rapid decrease in inflation rates. Living
standards have remained deplorable and Sudan’s debt has remained at an
unserviceable $24 billion dollars and yet, even before the recent spike in
crude oil prices, the government managed to spend more than revenue. Oil
production, even without the discovery of additional fields, is on the path to
become Khartoum’s
largest single source of revenue. Oil revenues for 2005 are projected to be 60%
of total revenues. Expanding production capacity, new discoveries in Darfur and increasing crude prices will only make this
importance more dramatic. Reported figures meanwhile fail to disclose funds
from royalty payments and bribes to enable drilling operations in this
endemically corrupt nation. If Sudan’s
oil revenues are not uplifting the people or improving the broader health of
the economy, one must wonder where the money goes. In the past 4 years,
government expenditure as percent of GDP has more than doubled and a recent IMF
report specifically mentions military spending as being in need of reduction.
Military expenditures have dramatically increased in past years, matching or
even surpassing the annual growth in oil revenue.
Oil
does not merely enable military operations. It also provides incentives for
abuses of human rights. The central role of oil in Sudan’s north-south conflict is
evidenced by the terms of a recent peace agreement, which mandates that oil
revenues must be shared. Reports from southern Sudanese oil fields during this
conflict mentioned military soldiers violently defending oil rigs and violating
settlers’ property rights in areas of potential drilling. In some cases, oil
corporations hired their own mercenaries to accomplish this. The discovery of
oil in southern Darfur has brought on fears that Khartoum’s harsh tactics will become even
more severe in an attempt to secure these fields. In addition to oil, Sudan
has large quantities of gold, and mining efforts are developing in this
industry as well, raising similar concerns.
Investments
in Sudan’s
oil industry support the corporations that explore and drill for oil. These
corporations harm the environment, trample citizen’s rights, bribe a corrupt
government and generate billions of dollars of revenue for the economy. These
lucrative operations directly enable the genocidal acts by the Sudanese
military and its proxy militias, while the people of Sudan continue to suffer and live
in poverty. The security blanket of oil revenue has dissuaded Khartoum from pursuing peace agreements and
shielded the regime from external political and financial pressure. Nearly all
foreign direct investment to Sudan
is in the oil industry, as it is considered the only stable industry in the
nation. Divestment becomes a powerful tool when one considers that any
instability in oil production has a cyclical effect on further investment and
further production and exploration ability. Any decrease in oil production
would result in a decrease of military capacity, and Khartoum would be forced to more seriously
approach peace talks.