Sunday, May 31, 2009

Wealth Sharing Beyond 2011: Economic Issues in Sudan’s North-South Peace Process by Achim Wennmann

This paper by Achim Wennmann is the product of the Centre of Conflict, Development and Peacebuilding (CCDP), a Swiss think-tank, as they attempt to learn some lessons about conflict resolution.

An important point in the brief review of the process leading up to the CPA is that peace talks had been going on and off for 20 years, almost as soon at the second rebellion against the north started in 1983. So the parties were very familiar with each other, their strengths and their personalities, and what they stood for. The observation does not, however, lead to a generalizable conclusion; i.e., familiarity meant no quick resolution, if one thinks that 20 years is a very long time for a peace process to be resolved.

The author has an extremely good summary of the various factors that made a peace agreement possible in 2003-05. These factors included the likelihood that oil revenues would strengthen the northern army, so SPLA would never win the war, the changed international environment of 9/11, which meant that the U.S. might be prepared to inflict serious harm on a victorious but un-democratic north; considerable regional hostility to the north; internal divisions between northern regime members and smaller-level threats in east and Darfur; the growing realization in the north that a persisting low-level war could be very harmful to continued flows of international capital.

The author justly emphasizes the importance of separating ownership from management of the oil resources; the CPA explicitly did not resolve the ownership question. it would be interesting if political scientists could figure out whether mediation attempts in other civil conflicts where natural resources play a significant role could be similarly structured. On the other hand, delinking has been a strategy of many international agreements; one thinks of the Chad pipeline agreement where the Chadian government formally ceded part of its sovereignty over oil. Presumably this has also been a big recurrent issue in the Cyprus negotiations.

Wennmann reminds us of some interesting points in the wealth-sharing negotiations and agreement. the North was given 100% of oil located in the north. Chain apparently agreed to pay for oil in cash rather than through barter of consumer goods. Much oil revenues were already locked in through future sales- Wennmann does not give a number, which would have been interesting. My recollection of the CPA is that these sales agreed to in the past were not the subject of explicit discussion- were the proceeds split 50:50? Finally, apparently the issue of sharing of the $20+ billion debt-burden came up in the talks, but again my recollection of the CPA is that it is silent on this qyuestion in the event of secession.

One of the conclusions is something I strongly disagree with, and want to subject to critical commentary:
The declining deposits of high quality oil wells in the south pose a challenge to the future viability of an independent state of Southern Sudan. Efforts should therefore be placed on developing Southern Sudan’s non-oil economy and redefining Sudan’s centre-periphery relations. Postponing the referendum may be a pragmatic strategy to strengthening wealth sharing agreements and the multiple ongoing peace processes in Sudan beyond 2011.
I just don't understand people when they talk about "viability" of South Sudan. The Sudan (the larger state) has been in civil war pretty much its entire post-independence history, including two of the largest most awful humanitarian catastrophes of recent history, involving hundreds of thousands of deaths and millions of persons displaced, and somehow that is supposed to be "more viable" than South Sudan? So please stop with the "viability" rhetoric. Any entity of the world is "viable" as a state. Any entity in the world can be a "successful" state. A political scientist who claims to know something more than common-sense about "viability" (a state composed of fragments one-square-kilometer blocks spread randomly around the globe will have a tough time) and "success" (a state created by international fiat and encompassing both parties to a very bloody conflict may not thrive) is not worth listening to. Otherwise, anything a political scientist can say is based on regression analysis with state outcomes as dependent variables and stata characteristics as explanatory variables, and more than likely all the state characteristics are endogenous, rendering the estimated coefficients pretty much meaningless. Correlations, not caustion. And correlation means that South Sudan becoming a state cannot be the object of meaningful inference.

One last thing. Wennmann has a throwaway line that, "It would be highly unlikely that Southern Sudan would get a better deal with the north on southern oil deposits if it was an independent state." I am not sure why that would be the case. Seems like they could easily get a better deal.

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