State Department Briefing on International Engagement Conference on South Sudan

Washington, DC–(ENEWSPF)–December 13, 2011. 

MODERATOR: MS. NULAND: Good afternoon, everybody. We are delighted today to have a special briefing for you from USAID Administrator Rajiv Shah and our U.S. Special Envoy for Sudan Princeton Lyman to talk about the International Engagement Conference on South Sudan, which starts tomorrow and which the Secretary will also address.

Without further ado, Administrator Shah.

ADMINISTRATOR SHAH: Thank you, and good afternoon. I’d like to share a few points about the International Engagement Conference on behalf of the Republic of South Sudan that the United States will be hosting with a number of other critical partners over the next few days.

First, this conference is an opportunity for the Government of Southern Sudan to lay out its vision for economic development and humanitarian assistance to the international community; to seek and receive coordinated and effective partnership from a number of broad partners from around the international community; and to have a direct dialogue and engagement with the private sector here in the United States and around the world to help private companies and investors see the Republic of Southern Sudan as a place where they want to increase their investments, thereby enabling significant economic development and economic growth.

Second, we, as the United States, working in partnership with so many important partners like the UK and Norway in the international community, have a track record of early success in South Sudan. We’ve helped to establish that country and its peaceful transition through the Comprehensive Peace Agreement. We’ve provided more than a million people with access to clean and safe drinking water, helped to increase school enrollment from 20 percent to 68 percent, and helped to establish a number of efforts in the area of agriculture and agricultural development that are so crucial to their economic future, because more than 80 percent of the people of Southern Sudan depend on agriculture for food and for income and live in rural communities.

Third, we’re hoping to build on that track record of partnership and success through the course of this conference this week. This is really an opportunity to ensure that the international engagement with Southern Sudan is coordinated and World Bank, the UK, Norway, EU, the African Union, and many of the regional partners will all be present to ensure that there’s effective coordination in our efforts in South Sudan.

We hope that the private sector will be a major feature of the Southern Sudanese presentation and of our partnership with them, in addition to launching some new efforts such as a $7 million agricultural lending facility with Equity Bank and Kenya Commercial Bank to help Southern Sudanese farmers gain access to resources. We’ll be working with American corporations that are increasingly interested in investing in Southern Sudan for their own future economic support and profitability.

And we hope that there will be a major theme of mutual accountability as part of this conference. The Southern Sudanese Government and President Kiir have made commitments to implement a public financial management law, to bring transparency to the private investment sector through their investment act, and to take critical decisions to ensure that oil revenue and revenue that’s generated from the oil sector is transparent and is reinvested against the core human needs that are still quite stark in Southern Sudan, a country where the maternal mortality, child mortality, and illiteracy rates are some of the highest in the world but could come down rapidly if the right decisions are taken.

Finally, all of these efforts are being undertaken to help the people of Southern Sudan achieve their own aspirations. It has been our premise from the beginning that it’s the Republic of Southern Sudan and its partners that have to make their own plan for their economic development, and that we follow along as partners supportive of a peaceful and prosperous outcome in that part of the world.

So with that, I’ll turn this over to Princeton Lyman to describe some of the overall political issues that shape the context in which we’re having this important meeting. Thank you.

AMBASSADOR LYMAN: Thanks, Raj. This conference is really shaping up to be quite a conference, and I congratulate Raj and all his colleagues at USAID who’ve been working for months now to put this conference together, because we’re getting people from all over the world really coming and participating and a very strong private sector participation. So I think it’s really an extraordinary event, and we’re looking forward to it very much.

As was mentioned, the Secretary will open the conference tomorrow. President Kiir, of course, will be speaking and have a large delegation.

It’s important because, with all the emphasis on the peace process and the independence and the continuing problems in negotiating with the North and problems on the border that I’m sure you’re very familiar with, it’s important to focus a spotlight on the real big challenges that South Sudan faces internally – a country of extraordinary poverty, terribly disrupted by decades of war, very limited infrastructure, and people who, after all those decades of war, are now looking for not only peace but the benefits of peace. And I think this conference will really throw a spotlight on both the needs but also the great potential that exists there.

We are continuing, of course, to be very concerned about the security situation, which has been exacerbated by the fighting going on in the southern states of Sudan, of Southern Kordofan and Blue Nile. We continue to press very hard for a return to negotiations and for full humanitarian access to those areas.

And we’ve cautioned both sides about the dangers of escalating border conflicts that have taken place – the bombing of a refugee camp at Yida, some fighting around another border area. And it emphasizes, just to finish on that point, the importance of the two countries moving together on a mechanism that they’ve agreed on, the Joint Political and Security Mechanism, which is to establish a demilitarized border zone with joint monitoring and UN participation. And we’re hoping that that mechanism, JPSM, will meet soon, and that they will start to move on instituting that system, because the border area – because there are disputed areas along the border and because it impacts on the fighting in Southern Kordofan and Blue Nile – is a flashpoint. Not that we think the two are going to go to war in that sense, but the conflict on the border, the clashes that take place, raise a lot of tension. And they impact on the ability of the two to negotiate other issues in oil, Abyei, et cetera. So those continue to be a major focus of ours, but this conference allows everyone to look at South Sudan and the needs it has, the prospects it has, the leadership it has, and to focus on the development of that country, which is going to be vital.

So again, I congratulate Raj and all his colleagues for the tremendous work they put into making this happen.

MS. NULAND: Questions? Michele.

QUESTION: Yeah, hi. Sudan has accused the South of fomenting a lot of this violence, of shipping up arms. Have you seen evidence of that? And will that be part of any – will there be conditions placed on any kind of aid packages that you guys might be announcing?

AMBASSADOR LYMAN: We’re not putting conditions on the aid packages. We have taken a position – we’ve communicated it very clearly to the Government of South Sudan – that we do not think that any military support should be given across the border to what’s happening in Southern Kordofan and Blue Nile. You know there’s a historical connection between the people who are fighting there and the SPLA in the South, and we understand that. But we think military support across the border is a dangerous and provocative situation. The government denies that they’re doing it. But we have made that point very strongly.

But it is – the government in Khartoum is wrong to say that the problem of Southern Kordofan and Blue Nile arises because of possible support from the South. That’s not the source of the problem. The source is that political issues in those two states, which were to be resolved through processes of popular consultations and negotiations, have not been resolved. And the government of Khartoum and the people from those states have to get back to a political process, and it’s not any support from the South that is at the heart of the problem.

MS. NULAND: Other questions? Please, Dave.

QUESTION: Where does the roadmap toward better relations with the Khartoum government stand? Has this violence been a setback to that?

AMBASSADOR LYMAN: No question it’s been a setback. We have told the government that it’s impossible to move forward on some of the key elements of the roadmap when they are bombing civilians and denying humanitarian access to Blue Nile and Southern Kordofan. It just can’t. So we have made that point clear, and it’s a fact.

MS. NULAND: Please.

QUESTION: What about the roadmap from the Khartoum government to remove them from the list of State Sponsor of Terrorism and sending a U.S. Ambassador?

AMBASSADOR LYMAN: Well, we’ve – as I said, we made it clear that we can’t move forward, let’s say, on the State Sponsors of Terrorism while this conflict is going on in Southern Kordofan and Blue Nile. There are three aspects of it. There is the bombing, which it hit civilian areas almost indiscriminately. There’s the denial of humanitarian access by international agencies – World Food Program, UNICEF, et cetera. And there’s the need to get back to negotiations. All three of those are critical for us to be able to move forward and take up the issue of State Sponsor of Terrorism or other things on the roadmap. We’ve made that point quite, quite clear to the government of Khartoum.

QUESTION: Is the North blocking the export of oil from the South?

AMBASSADOR LYMAN: No, not really. There’s been talk of that, but it looks like the oil is still going through. There are talks starting tomorrow – no, on the 17th in Addis – further talks between the two on the oil sector.

QUESTION: Thank you.

MS. NULAND: (Inaudible.)

QUESTION: Fine. What kind of resolution you are looking for from this conference?

ADMINISTRATOR SHAH: Well, I think there will be a number of announcements, and almost every major partner or participant will be mentioning what their commitment to Southern Sudan will look like. For many partners – like the United States, the UK, and Norway – we’ve had a longstanding program in the South, working with partners there, and we’ll be continuing that and building upon that progress in a manner that is consistent with what the Republic of South Sudan is asking for, which is support in main productive sectors, help to get private investment in, and support for critical areas like health and education.

I guess I’d make two quick points. One is that across our partnership, we’ve sort of made a decision that different countries will take the lead in different areas of work so that we’re more effectively coordinated. So the UK leads in health and in anticorruption efforts; the Norwegians lead in helping to support the Republic of South Sudan in managing their oil revenues in a transparent and visible way; and the United States has taken a leadership on agricultural development and private investment. And that sort of division of labor will likely be reinforced in the meeting that takes place.

QUESTION: Thank you.

QUESTION: I just had one quick follow-up. Just given all the violence, I mean, what is your message to private companies thinking about going into this place? And also just talk about the lack of infrastructure. I mean, how do you go about opening up business contacts in a place like that?

ADMINISTRATOR SHAH: Well, there are really two things that have to happen. The Government of South Sudan has to make some decisions about their commitments to extractive industries, transparency, for example, or the basic protection of investments that are made from the outside to build up investor confidence. President Kiir at the UN General Assembly made very strong, positive commitments on both of those issues, and we expect he’ll have more to say on that in this meeting.

The other piece is there are a long line of potential investors that see opportunity in the South, Nairobi-based agricultural investors that recognize that you could get 2-, 300 percent yield improvements on agriculture in the South because it’s very fertile, very rich soils, a lot of opportunity, and there hasn’t been the kind of basic investment in the agriculture sector that you would expect, given that opportunity.

There are increasing opportunities for U.S. firms to engage in the oil sector, for example. So we’re seeing strong interest. The Corporate Council on Africa is a co-sponsor, and they represent a series of companies that are interested in making investments in South Sudan, and part of this meeting is to bring those companies into close contact with leadership.

QUESTION: And U.S. sanctions don’t affect – I mean, the lingering sanctions on the North don’t affect what’s happened?

ADMINISTRATOR SHAH: Well, not for, say, agricultural investments in the South. And there’s been also some adjustments made to allow for U.S. firms to make investments in the oil sector in particular.

MS. NULAND: Anybody else? Nicole?

QUESTION: I just wanted to ask the Ambassador if there are concerns about the State of Sudan of the North, because they have lost an immense amount of revenue and territory. And I’m just wondering how concerned you are about the country’s ability to stay together, not to collapse or dissolve.

AMBASSADOR LYMAN: Well, I – it’s a very important consideration, because in our view, the government faces a very serious economic problem. They’ve lost 70 percent of their oil, and that means a huge fiscal gap of over $7 billion over the next few years and a big foreign exchange loss. And so you can see prices are going up. There’s pressure on the Sudanese pound. They’re facing serious budget problems.

And what we’re saying is this is no time to go to war in three or four of the states of your country, Southern Kordofan, Blue Nile, Darfur, et cetera. And it is important to get a negotiated solution to the oil sector with the South. So I – it’s a very dangerous situation, it seems to me, for the stability and economic needs of Sudan in this situation. And it’s another reason why pursuing those military options in the Southern area is, in our view, very counterproductive to the needs of the country.

QUESTION: Thank you.

MS. NULAND: Thank you, everybody. And thank you to our guests.

QUESTION: Thank you.

MS. NULAND: I’ll just walk them out, and then be back for the daily.