Sudan, South to finalise talks ‘by end-Sept’ and Khartoum drops high transit fee demand
Khaleej Times Online > INTERNATIONAL
(AFP)
30 July 2011: JUBA – South Sudan said on Saturday it has agreed with the north to finalise talks on the key issues of oil, currency and borders by the end of September, after the first round of negotiations since independence.
“We have agreed that by September 30 we will reach a final agreement that will be the basis of the (economic) relationship between the two states,” the south’s chief negotiator Pagan Amum told reporters in Juba.
The agreement would cover the oil sector and the currency issue, Amum said after returning from Addis Ababa, where the African Union-mediated talks resumed this week following their suspension prior to southern independence on July 9.
The two issues had prompted Amum, who is the south’s minister of peace and secretary general of its ruling party, the SPLM, to warn Monday of an “economic war” with the north, which he accused of imposing oil transit fees that amounted to “daylight robbery.”
Around 75 percent of Sudan’s total crude production of 470,000 barrels per day is pumped from the south.
Khartoum’s cash-strapped government is desperate to offset the loss of southern oil revenues, which represented some 36 percent of its income prior to partition.
The north approved a law last week imposing fees on the landlocked south’s use of northern oil infrastructure.
But on Saturday, Amum said Khartoum had agreed to charge pipeline transit fees “according to international standards.”
The negotiating teams in the Ethiopian capital also discussed how the south and the international community would help Khartoum to recover its losses, which Amum said were about $340 million per month depending on oil prices.
The two sides launched new currencies in the past two weeks, and there have been widespread fears in Juba that Khartoum will refuse to buy back the estimated two billion old Sudanese pounds in circulation in the south and even flood the country with the old currency before it is withdrawn.
But Amum said on Saturday that the central banks from north and south had agreed to form a joint committee to replace the old Sudanese pound “in a transparent manner,” to build confidence in the new currencies.
Sudan sees progress with north in oil, currency row
By Jeremy Clarke
JUBA Jul 30 (Reuters) – South Sudan sees progress in resolving disputes with Khartoum over the sharing of oil revenues and launch of new currencies, it said on Saturday, striking a conciliatory note after earlier accusing its former civil war foe of starting an economic war.
South Sudan will a pay a pipeline transit fee for its oil in line with international standards after the North dropped its demand for a “discriminatory” $22.8 a barrel, said Pagan Amum, secretary general of the southern ruling Sudan People’s Liberation Movement (SPLM).
South Sudan became independent from Sudan on July 9, taking with it 75 percent of the African country’s 500,000 barrels a day of oil production — the economic lifeline for north and south.
South Sudan will have to pay Khartoum a fee to carry its oil through a pipeline to the countries’ only Red Sea port but the two have yet to agree on how to divide oil revenues that have so far been split equally.
Amum said Khartoum had withdrawn an earlier request for a pipeline fee of $22.8 per barrel — about 20 percent of the oil’s export value based on June prices — after fresh bilateral talks in the Ethiopian capital Addis Ababa.
The two sides wanted to solve all disputes by September 30, Amum told reporters in the southern capital Juba after his return. Western diplomats had hoped they would reach an agreement before southern independence.
“We will be paying pipeline fees … and also we will be paying transit fees that are within the international practices and standards,” he said, without saying how much the South was willing to pay.
“This discussion brought to an end the attempt to impose discriminatory surcharges by the government in Khartoum, who announced they would impose $22.8 per barrel … They have withdrawn officially this position,” he said.
There was no immediate reaction by the northern government, which had not confirmed the $22.8 a barrel demand the South announced on Monday, calling it “broad daylight robbery.”
The dispute over sharing oil revenues could threaten to disrupt the flow of crude from the country, a significant exporter to China and Japan.
The South won its independence in a referendum in January agreed under a 2005 peace deal that ended decades of civil war with the North.
Analysts say there has been little transparency for years on how oil revenues are booked in Sudan, hit by years of conflict, inflation, corruption and U.S. trade sanctions.
CURRENCY TURMOIL
The countries are also discussing ways to build confidence in their new currencies, he said.
North and south each started circulating new money in July, without coordination, a move that poses risks for both sides. The north has said old Sudanese pounds held in the south will be worthless, which would hit the new nation hard.
But any efforts by the South to export the old notes north could add to strong inflationary pressures there.
“We have agreed to form a joint committee from the two central banks so that the replacement and exchange of the (old) Sudanese pounds with the (new) South Sudan pound, as well as the change of Sudanese pounds in Khartoum, will be done in a transparent manner,” Amum said.
“The old pound will be kept within a very clear framework of management so that there will be no dumping of the Sudanese pound,” he said, without being more specific.
The northern central bank has said it is open to more talks, but that if they came to nothing it would speed up replacing the old currency which would become worthless in the South.
Apart from economic issues, the dividing countries have to fix their long border, end violence in some border areas, and find a solution for the contested Abyei region which straddles north and south.
(Additional reporting by Hereward Holland in Juba and Aaron Masho in Addis Ababa; Writing by Ulf Laessing; Editing by Catherine Evans)
S.Sudan says Khartoum drops high transit fee demand
JUBA, (Reuters) – South Sudan has agreed with Khartoum that it will a pay a pipeline transit fee for its oil in line with international standards after the north dropped its demand for a “discriminatory” $22.8 a barrel, a senior southern official said on Saturday.
The comments could ease tensions between the two countries after the South, the newest African nation, accused Khartoum on Monday of “broad daylight robbery” and starting an economic war.
South Sudan became independent from Sudan on July 9, taking with it 75 percent of the African country’s 500,000 barrels a day of oil production — the lifeline for north and south.
South Sudan will have to pay Khartoum a fee to carry its oil through a pipeline to the countries’ only Red Sea port but the two have yet to agree on how to divide oil revenues that have so far been split equally.
Khartoum has withdrawn an earlier request for a pipeline fee of $22.8 per barrel — about 20 percent of the oil’s export value — said Pagan Amum, secretary general of the ruling southern Sudan People’s Liberation Movement (SPLM).
Both sides agreed at talks in Ethiopia that the South would pay a fee in line with international norms, Amum said after his return from Addis Ababa, without being specific.
“We will be paying pipeline fees … and also we will be paying transit fees that are within the international practices and standards,” he told reporters.
“This discussion brought to an end the attempt to impose discriminatory surcharges by the government in Khartoum, who announced they would impose $22.8 per barrel … They have withdrawn officially this position,” he said.
There was no immediate reaction by the northern government, which had not confirmed the $22.8 a barrel demand announced by the South on Monday.
The dispute over sharing oil revenues could threaten to disrupt the flow of crude from the country, a significant exporter to China and Japan.
The South won its independence in a referendum in January agreed under a 2005 peace deal that ended decades of civil war with the North.
Analysts say there has been little transparency for years on how oil revenues are booked in Sudan, hit by years of conflict, inflation, corruption and U.S. trade sanctions.
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